Podcast Episode - What A Difference A Year Makes

Health Insurance, Investing, Scam, Scam Alert, Stock Market

February 21, 2021

Listen to Podcast Episode:

On this podcast, Suze talks about why it might be a good idea to file your taxes now, then takes us to Suze School on how some of the events over the past 12 months affected our finances.

Podcast Transcript:

February 21st, 2021. Do you know what today is? Just think about it. February 21st, 2021. Well, I'll tell you, it was essentially one year ago today that really the pandemic became a reality, that it started to hit that, oh my God, something's going on the United States, the world is going to change and the stock market is going to get hit. We were all thinking that. And so, in a little bit I want to talk about that and what that means to us in terms of investing today, February 21st, 2021, one year later, one year later from when this all started. But I just briefly, before I begin that, I want to talk about scams because recently, you know, many things have been happening. And all of you, in my opinion, are becoming more vulnerable to scams, to people ripping you off for money that you think is absolutely legit. Because most of you are such great people that you believe anybody that says anything to you and you just go ahead and do it. I first want to start with myself. Recently really, for the past year or so, there's a picture of me in a yellow top and don't know whatever, whatever it's about, because they use it for different things. That says, Suze Orman says you should invest in this, and many of you have. And I've warned you whether it's on my women and money app, my Twitter feed, Facebook, Instagram I've warned you. Scam, scam, do not do it. Well, what's so great is that finally, I had to take legal action. This costs me money. And if you think I'm going to let it go, it just that it costs me money and not go after these people, oh you are wrong. But it happens to be a major firm that was behind this, that they say they didn't even know they were behind this. They've agreed to take it all down and there will be, I hope, some financial renumeration. But if ever you see a picture of me, just a picture of me and it says Suze says you should do this or an interview with me. That doesn't mean I really gave the interview and that I really said it. If you want to make sure, either I tell you what I want you to do on this podcast such as Alliant or whatever it may be, dental savings plan. Those things I tell you about, I talk about it. It's on my Women and Money app. I like those things. You can see if it's a video of me talking about it that may even be a little bit different as well. But if it's just a picture saying Suze Orman likes this, do not do it, do not do it. Do not do it, okay, because it will be a scam and you will lose money. Next some good news is that the Affordable Care Act has been extended now until when May 15th, where you can, no matter who you are, no matter what circumstance you're under, apply for health insurance. But again, you have to be careful. The only place that you should apply is at healthcare.gov. If you get an email if you get a phone call, if you get something that says they're from healthcare.gov. They want you to do this. Do not do it. It is a scam off somebody else, wanting you to do insurance, but not insurance that is The Affordable Care Act. So, if you need health insurance and you're going for health insurance, meaning you're looking for it and you don't have a lot of money go to healthcare.gov and apply there again. It's open enrollment until May 15. They just opened it. Usually it is not open, except for special circumstances right now. So, take advantage of that. One other thing not a scam, but just something for you to think about. I know that they're talking about Congress, and the Biden administration is talking about this $1400 stimulus. Check all of these things, and I think that it's really important that you understand they're not even going to really be able to vote on that until the middle of March or so, which isn't that far away. What does that mean? That means that if they vote on it, they pass it eventually, whatever the amount is to whatever income group is going to get this that the IRS in the middle of tax season is going to have to send you the debit cards or the checks or put it into your account. Therefore, just like last year where they postponed Tax Day because of this until July 15th, who knows? They may do the same this year. But if I were you, I would make sure that all of my information was on record with the IRS. Because the very first people, if you qualify for the stimulus check, the very first people that are going to get it will be the people that the IRS can do a direct deposit, directly into your account. So don't wait. And don't you know, say, Oh, it's all right, they'll send me a debit card. It could be months and months before they're able to send you the money that you deserve. If your information is not on file. So, here's something else I just want to say, if you made less in 2020 than you did in 2019, file your taxes now because that may allow you to qualify for the stimulus. The full amount of the stimulus, so don't wait. I know a lot of you wait to the very last minute to file your taxes for whatever reason, even if you're going to get a refund. But don't do that in this situation file now, if you made less in 2020 than you did 2019. The government is going to allow you, however, to qualify for the stimulus based on 2019 taxes. So, if you made less in 2019 than you did in 2020 and maybe what you made in 2020 disqualifies you from the stimulus don't file yet. Just wait. Just wait so that you can get the stimulus check based on 2019 taxes, right? Those were just a few things that I wanted to talk to you about, about things that I wanted you to do, things that I wanted you to watch out for and when to file your taxes. All right, let's kind of go to Suze School and let's go back to history of one year ago today. On February 21st, 2020 the Dow Jones Industrial average, and all of you should know what that is by now. It is an index that follows 30 stocks, and they compile the averages of those stock prices to give you their average price. And based on their average price, the index goes up, the index goes down. But you get an overall sense off what the market is doing. Another indicator would be the Standard and Poor's 500 Index, which does about 500 stocks. But let's just talk about the Dow Jones Industrial Index today. Okay, February 21st, 2020 The Dow Jones Industrial index was at 28,992. And then, as I said earlier in the podcast, the pandemic hit and all of you, I'm sure, started to freak out. And I start doing podcasts around then, especially around March 1st. But I kept coming on. I kept saying, No, no, just hold. Do not sell unless you need your money immediately. Do not sell. Just hold. But then we watched, and one month later, on March 23rd, which really was when everything really kind of crashed, the Dow Jones industrial was down 10,000 points approximately to 18,591. And I'm sure it was at that point that many of you freaked and said, I'm out, I can't take it. I don't want to lose any money and you sold. Did you get back in? Did you not, chances are you did not. And today, February 21st, 2021 the Dow Jones industrial average is at 31,494, almost 3000 points, or 10% above where it was one year ago today. So do you remember back in March of 2020 I told all of you to do one of the craziest things and I said it right on the podcast. You can hear it if you go back and find that one. That said, I'm going to tell you to do something or talk about something that everybody is telling me is the worst call I have ever made. And this was at a time when oil was crashing. Everybody was saying, Oil is going to disappear. Nobody's flying on airplanes anymore. Nobody's allowed to drive. Oil's going to go down, down, down, down and I got on this podcast and I said, Okay, I think this may be the time to buy a new exchange traded fun with a symbol with the letters XLE, which is the exchange traded fund for most oil stocks. Now, at the time when I was doing that, oil was down to negative $30 a barrel. What does that mean to you? What that meant at that time was that if you had oil, you had to pay somebody about $30 to take it off your hands. And everybody was saying oil is never going to come back. Stay away from oil stocks, sell all your oil stocks, get out of oil, get out of oil. And here I am telling you, you could just look into that, that was some money because who knew what it was going to happen or not, and to dollar cost average into it. And just to give you an example. On February 21st of last year, XLE was at $54.14 per share. On March 23rd, when everything had crashed, XLE was at $23.57 a share. Now we're dollar cost averaging into it. We're buying it. Everything's kind of good, I think. And today, February 21st, 2021 it's at $46.18 a share. Now I just want to talk about this for one second here. Where do I think XLE can go from here? I think truthfully at this point, and it's yielding you still about a 5% dividend yield? I think it could easily go into the sixties and so that that's just an interesting thing because I do think oil, and the demand for oil and what happened in Texas, everything could really keep pushing the price of oil up and therefore XLE will go up as well for a period of time. Just something to think about. Next, Bitcoin you know, back in February 21st, 2020 Bitcoin was it about $9700 a Bitcoin. Then, on March 23rd, 2020 it was down at $6400 a Bitcoin, and essentially on February 20th/21st it's around $57,000 a Bitcoin. Now why am I telling you this because over this last year, we've learned many lessons. We've learned how incredibly important it is to have a 12-month emergency fund, and I still think that is the foundation of any financial freedom recipe. Without an emergency fund, you are making one of the biggest mistakes out there. And I'm so excited that very shortly here, very shortly, I'm going to talk to all of you about a company that I co-founded that we were in seed funding for and we got our seed funding. That will absolutely help you if you work for an employer that goes along with what we have created to help you build an emergency fund. But we got used to watching things go down. Everything was so good in 2020 the markets were good, Oil was good. Bitcoin, we thought was good, everything was good and then we watched it go down very quickly. Within one month it went down significantly and then very shortly after that, everything returned and it started to go higher and higher and higher. And here we are today, one year later, with a higher Dow Jones Industrial Average higher on the XLE essentially, Bitcoin seriously higher. And what I'm afraid of at this point in time, is what you've gotten used to. You somehow got used to when something goes down, that's okay. It turns around and it comes right back up immediately. And that's how you now make money. And I'm not so sure that's going to continue to be true, you know, even for myself. And I just want to talk about this a week or two ago, I can't remember when I was telling you how on around my Birthday I bought a stock and I don't mind telling you the name of it now Micro Strategies. Symbol MSTR this was a company that was kind of a technology company. But for some reason, Michael Sailor, the CEO of it, decided to put all of his cash reserves for this company into Bitcoin. So, all of a sudden it turned from a technology company, into like an exchange traded fund for Bitcoin, and it literally went from about $125 a share last June, all the way up to 1000 something dollars a share recently. And on Friday, just a few days ago, I decided to sell it and I decided to sell it when Bitcoin was down at about $52,000 a share and I had noticed that Bitcoin was going up but that the price of MicroStrategy's was going down and I decided, that's it. I'm out and the reason that I got out and that's not to say If you want to buy, you shouldn't buy it up to you. I'm not telling you either way what you should do there. But the reason that I got out is because it's just not normal everybody. It's not normal to buy something at $125 a share and then have it go to almost $1000 a share within a very short period of time. And so I sold it and I was very happy with the game. And then my KT starts to see that Bitcoin is absolutely now going up, going up, and very probably MicroStrategy's will again continue to go up and up, and she says to me, are you sad that you sold it? And I said, no, why would I be sad? She said, because you could have made more money, and that's almost what I want to talk to all of you about. For some reason, over my entire career, it has always been that when I did have clients or when I would talk to people, they would be so happy to have made money. But then they would be so sad that they did not make as much money as they could have made if they just held on. In fact, they were more sad or upset when they sold a stock on investment too soon, and it continued to go up and then they would do these calculations in their head. Oh, my God, if I had just held on to it, I would have made this. I would have made that. You know how much money I would have had, Suze? They would be more upset at not making us much as they could have made than having actually lost money. And I'm afraid that that mentality has set in. I was trying to tell KT, KT, what difference does it make? So what? I made a lot of money. We made a lot of money, and if it continued to go up. Okay, so maybe we would have made some more money or whatever, but I was very happy with the amount of money I made. And I'm not upset that I sold it on any level. And I hope it continues to go back up, big time for everybody that held it. So, when I own a stock and I sell it, I do not look at what that stock does after I have sold it. I look at the stocks that I currently own and I make decisions on the stocks that I currently own, as to should I keep them or should I sell them or what should I do? I do not waste my time looking at would of, could of, should of and I don't want you to do that as well. I also don't want you to get greedy. I also don't want you to look at something and go, oh my God, it's going up. I have to get involved with this. I have to put a lot of money into it. And you just do it because it's going up. What scared me yesterday for the first time about Bitcoin was that I had somebody over who was a hairdresser? Fabulous hairdresser. And we were talking as she was doing my hair. It was interesting. She said So what do you think about Bitcoin? I'm thinking about investing in it. Now I know that this woman doesn't have very much money and I know also she doesn't have a 12-month emergency from and I also know that prior to yesterday, in all the years that I've known this woman, she has never once cared about investing. She didn't care about opening up a Roth IRA. She didn't care about things that I was telling her. Please, just dollar cost average into the Vanguard Total Stock Market Index fund. Please just do that. She didn't care about that. But now she cares about Bitcoin. Too many people are starting to talk about Bitcoin. And it reminds me of back in 2006, 2007 when my valet here it the condo that I live in in Florida told me that he was going to stop being a valet and he was going to become a real estate agent right when everything crashed. Now I am not telling you that Bitcoin is going to crash. Do I think that it could run up here possibly for a few more days and everything, I do. But I also think that could absolutely retreat. So, I am just repeating myself right now. If you're going to do Bitcoin, I do Bitcoin through PayPal. You may decide to do Bitcoin through coin base or the other entities that are out there or the wallets or whatever it may be. But dollar cost average into it, little by little, knowing that yeah, money can be made, but money could be lost. And I would only be doing it if I were you for the long run. Is it possible that Bitcoin could easily be 10 times higher 5 or 10 years from now? Oh, you bet it is. It could also disappear. So, if you're going to do it, don't do it to trade it. Do it little by little to hold it and hope that it goes down because you don't want it to go up. You want it to go down if it keeps going up, if you put in $100 or it's going to buy you so little, so maybe it could go down again. Which means you get to buy a little bit more of a Bitcoin, when you dollar cost average. The reason that again I'm talking about that is that I just want to bring up GameStop. Remember GameStop everybody? That was what everybody was talking to me about. Every email, everybody who saw me anywhere. Suze, should I get into GameStop. What do you think about GameStop and have you followed it? Do you know where it is now? Do you even know about some of the people that were involved in it? Many of them have been soon and class action suits, one in particular for $5 million. Have you even thought about what's happened to Robin Hood? Now, in almost 58% of the people who had accounts at Robin Hood are thinking about leaving or have left. It's so simple for all of us to hear about the news, get involved with something, do it without knowing what we're doing, and then we get in trouble. GameStop. Just so you know, back in February, 21st, 2020 was at $4 a share In March 23rd, it was a $3.81 cents a share, and today it's at $40.59 a share, up considerably, but it’s down from $483 just a little bit ago. I hope you have learned from GameStop and stop playing the game of what that represented. That is not how you are to make money. So, I just want to make you aware there's really nothing wrong when you have made a considerable sum of money and maybe you need money or you're happy with the amount of money that you made, taking into consideration the taxes or whatever it may be, there's nothing wrong with taking a serious, serious profit. You can always go back in if you're wrong, but there's nothing wrong with that. But if you don't know what to do, here is a test that I think you should take. Ask yourself the question. Let's say you own a stock. And rather than having $10,000 in that stock, let's say that you had $10,000 in cash. The question that you should ask yourself is this? Would I buy that stock or that investment right here? And right now, with that $10,000 if the answer to that is no, I would not. That is an indication that maybe you should sell. If the answer to that question is yes, I would. Then you should hold on to it. If the answer to that question is, I don't know, then sell half. There's nothing wrong was selling half. But really, you need to look at this point in time at every single investment that you have and ask yourself that question. I still think we have, a good month or so off where the markets are going to be good and go up and we're going to be okay. But I still think around April, you know, the first week of April, 2nd week of April, we could see a turn. One of the reasons that I think that is because so many people are counting on the stimulus checks coming out and all of you taking those stimulus checks and using it to buy things and stimulate the economy. I'm thinking that many of you are going to be taking those stimulus checks and putting it in your emergency fund putting it somewhere. Maybe even to pay off debt, saving it somehow because you don't know where this pandemic is going. You don't know if you're going to have unemployment or not. There is so many unknowns still. So, I'm not exactly sure that all of you are going to take all of this money and go out and buy things with it. Maybe Yes, maybe No. But we'll see. So, I'm just being really cautious here, and there's nothing wrong with being cautious. You've worked so hard for your money and everything should be okay with you in terms of the money that you invested, especially money that you don't need for 10, 20, 30, or 40 years. But then there are some of you that may really need this money. You don't have an emergency fund, you really don't have cash, and you may need it in the next year or you do need it in the next year. I want you to think very seriously about if you should be in these markets or not, because I personally would tell you if you need it sell. Especially the last week, maybe first week of April that's what I would tell you. I don't know if I'm right, I don't know if I'm wrong but what's really important is this is your money, and what happens to it directly affects the quality of your life. Not my life, not anybody else's life. So, you have got to trust your gut on this one, on what's good for you may not be good for your next door neighbor or your sister or your brother or me, but you have to do what's good for you. Remember, the goal of money is for you to be secure, and sometimes if you're in the market and you're afraid and whatever, it's not giving you security and security is worth more. Sleeping good at night is worth more feeling good. Every single day is worth more than a stock going up a few more points or down, or whatever it may do. So, you have to take the moves today that will make you feel secure. All right, I have no idea what I'm going to name this podcast, don't have a clue. But I do know this that when it comes to your money, there's only one thing that matters. And it is this people first, then money, then things. Now you stay safe.

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