← Suze Orman's Women & Money (And Everyone Smart Enough To Listen)
Suze Orman's Women & Money (And Everyone Smart Enough To Listen)
Suze School: Avoid the Biggest Downfall to Your Investing Habits
00:24:43
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- [00:00]
Suze Orman
Hi, everybody. Suzio here. Now, what is the goal of money? The goal of money is for you to be secure. And there is no better way for you to be secure than having an emergency savings account. It is essential for your financial foundation. So all of you should be participating in the Ultimate Opportunity savings account at Alliant Credit Union. Go to myalliant.com to find out more. And be secure.
- [00:32]
Podcast Host
Okay, Susie, are you ready for today's podcast?
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Suze Orman
Oh, you bet I am Cuz I'm unstoppable I put my armor on show.
- [00:40]
Unstoppable Theme Song
You how strong I am I put my armor on I'll show you that I yeah, yeah, yeah, yeah I'm unstoppable I'm a bu with no breaks I'm invincible yeah I win every single game I powerful I don't need batteries to play I'm so confident yeah, I'm unstoppable.
- [01:11]
Suze Orman
Today December 22, 2024. Welcome everybody to the Women in Money podcast as well as everybody smart enough to listen. All right, three days, three days before the holiday gift giving day and the question becomes, did you listen to last Sunday' podcast? Did you take it to your financial heart and really not go out and buy this and that out of guilt and whatever? I hope that you did. However, today is Susie school and I think that you should, number one, take out your Susie notebooks because I do think that there's a lot that we should learn from what happened last Wednesday. Last Wednesday in reality, was one of the greatest lessons that I hope all of you learned from. But I'll get there in one second. Besides the fact that the market really went down a lot on that day, the other thing that was causing a lot of uncertainty in our lives, was the government going to shut down or not? Were millions of government workers not going to get their paychecks? Or will they? I personally was not worried about it at all because I know that the last time we had a government shutdown in 2018, I think it was 30 some odd days it was shut down. That was one of the major reasons that there was a big political toll taken on that party. And it really didn't make any sense at all. And I think people learned a big lesson from it. So you can threaten, you're going to shut it down. You can talk big, you're going to shut it down. But I knew without a shadow of a doubt that there was no way they were going to let this government shut down, especially three days before the holidays. Are you crazy? So for me, that didn't come to play at all. What did come to play, however, was the speech that Jay Powell, the Fed chair, gave after he announced that he was going to lower the fed funds rate by a quarter percent. Now the lowering of that rate really didn't take much effect on anybody. They didn't know if he was going to or not. But okay. I think what really shook people was what he said after that. Because after they announced the lowering of the rate, he then goes into this room and he stands there at a podium and every financial reporter, economic reporter sits before him and they all get a chance to ask him a question and he answers. What really came out of his talk and his statements that he made was that rather than being on this rapid downturn of fed funds rate, which he said he was going to do a year or so ago, we were all for sure that in 2024 the fed funds rates were going to go down, down, down, down, down, which meant interest rates were going to go down. And all of us had planned on that. All our money moves were planned on that. But that's not what he did. But not only did he not do that, he actually said the following. He said there will probably only be two rate cuts in 25, maybe another two in 26 and maybe two in 2027. He also said that he didn't expect inflation to really go down. That inflation was a little bit harder to tame than he thought. But the economy is still doing well, don't worry about it. To me, that was the most confusing thing I had ever heard. And as he was talking, you could see and just watch these markets start to crash, go down and down and down and down. Stocks that I loved going down big time, big time. Now normally when you see stocks going down big time, your reaction usually is, I gotta sell. Oh my God, everything's gonna go to hell in a handbasket. Oh my God, I've gotta get out. So you join the crowd mentality. You're watching tv, it' going down. You're watching your stocks, you're watching these things you had gains in go all the way down. The announcers on CNBC and everything, they're not making it any better for you. They're at this high pitch like I am right now. They're all freaked out. You're watching everything be red on the big screen that says when something's going up or down. And red represents down. And you buy into it and you sell and you get depressed, but you feel a little better because maybe you sold. And after you sold, it continued Down a lot. Me, I was waiting for the very last minute before the markets were closing, when it was almost at its worst, where the momentum have picked up. And I went in and I bought like a mad woman. I bought Palantir, I bought ibit, I bought gev, this one stock that I really like. I bought them all. All the stocks that I talk about, I bought them all. And I was able to buy them all because I do dollar cost average. I keep a pile of cash for days like that. I don't put all my money to work. And then when something like that happens, I can't take advantage of it. I wait for days like that to happen. I loved that Palantir went all the way back down again. I loved that Nvidia went to like 128. I loved that. So for me, I was so happy that day. Kt, on the other hand, was a little bit more freaked than I think she sounded on the last podcast where she said, what are you doing? I said, I'm buying. She said, look at the market. I said, I know, that's why I'm buying. And I said, kt, you have to leave me alone because I really need to buy now. I want you to think about this, everybody. Not everything that you own when it goes down is going to come back. And the only reason that that may be true is that some of the things that you own, some of the stocks that you own really aren't worth owning. You've owned them for many reasons. Maybe years have gone by and whatever, and maybe they're not going to come back. But when you are invested in the stocks of the future, the stocks that hold the ability to really transform this world in their companies, and you have faith in their management, faith in what they are doing, then of course you want to buy more when they go down, because you didn't buy them for them to just go straight up. You bought them so that three years from now, five years from now, 10 years from now, you will have made a fortune. You have got to get it out of your head that when something goes from 10 to 20, you now doubled your money. Oh, you have to get out of the position because of course it's going to go back down. You have to get into this mindset of your buying things little by little, because you have the belief that over time, these stocks are going to be worth so much more. And that's where the big money is going to be made. Not at 10% here, 30% here, even 100%. You have to Be more futuristic about how you're thinking about the stocks that you are investing in now. A lot of you have diversified in exchange traded funds, whether they're the Spiders or the voos or the VTIs. And the good thing about those is their top holdings are invested in these futuristic stocks. So you're doing okay there, by all means. But it's also important that if you are buying individual stocks and that is how you want to go about investing, that you have some diversification. But it's okay to be heavily also invested in stocks that are diversified in a little bit what they're doing, but they're all tied, whether it's Iota or Nvidia, a little bit different, but they all help one another. So that's what I did Wednesday. What did you do? Did you do anything or did you just get upset? And as you know, I invest Kolo's money for him. And I watched Kolo's portfolio that day go down equally as everything else. And because I also kept money on the side for him, I only have 50% of his cash invested. I was able to go in and double down on certain things. And then Friday, when the market finally closed, I was up so much higher on Colo's portfolio than where I was on Tuesday's closing before the market went down on Wednesday because I was able to dollar cost average into it at its low. I tell you this because I don't want you to make one of the biggest downfalls to your investing habits. And one of the biggest downfalls is you watch what you have purchased every moment of the day or five times a day, or you're watching CNBC and you're watching are the markets going up or are the markets going down? If you are invested in something that you are certain about, that you have faith in, that you haven't heard anything bad about it and the markets happen to be tumbling or whatever, okay? But don't just look at something and go, oh my God, it's going up. Oh, today it's going down. Oh, what should I do? Oh my God, I don't know, I'm so nervous. And that's when you tend to make serious mistakes. So I personally think the best advice I could give all of you is stop looking at your portfolio. I'm not kidding, I'm really not kidding that if you know you're invested correctly, don't look at your portfolio every day. Obviously, if something starts to happen and the markets are going down, take advantage of it. All right? I was looking at the messages on the Women and Money community app. And somebody wrote me and said, susie, can you just tell me when to buy, when the markets are going down and when they're going up? Wrong question. Wrong. It's not about if the markets are going up or the markets are going down. Sometimes you have to average up. And that's just how it works is. So I want you not to worry again in 2025. We'll have to see what happens. But there are certain stocks that, whether it's 2025 or 2026 or whatever, I don't know what they're going to do. But over the long run, such as Apple, such as Tesla, such as Nvidia, such as. And I could go on and on. There are stocks that you just want to hold for the long run. Now, you might want to do an experiment. Go back to when Amazon first went public, go back to when Apple first went public and just pretend that you put $1,000 in each one of them and you forgot about it. You never looked at them again, and you even forgot that you invested in them. Why don't you look at how much money you would have today? I was there when Amazon went public, and I'll never forget saying to myself, who in the world wants to buy a stock that sells used books or anything? But I thought to myself, Amazon. Hmm. I'm an Amazon. That's a good reason to buy that stock. Apple. Well, that one was easy for me because it was Steve Wozniak and Steve Jobs that used to come into the Buttercup Bakery before they were Apple Computer, and they had no money, and I would serve them coffee and everything. And then Steve's sister, Leslie Wozniak, came in, because then here I am, a stockbroker at the time at Merrill lynch, and she was given quite a bit of Apple stock. And I thought, well, I should do that stock as well. Now, my biggest mistake with both of those is I thought when I was up 100% or 200%, that I did well and I did not hold on to them. Learn from my mistakes. And I can tell you that Tesla and other companies, even Apple, those will be companies that one day you'll go, why did I ever sell? All right, now let's talk about just a few more things. With inflation being where it is right now and it being very hard to tame. And it's hard to tame mainly because of insurance on homes that keep going up and up and up and other things, it is going to be more difficult for you if you already don't own a home to purchase a home. It just is. Because now that, as I've said to you many times, mortgages are attached to the 10 year treasury note and the 10 year treasury note may very well just be staying here or going up from here. So the chances of mortgage rates going down where we really believed that they were going to be going, I just don't think that's going to happen. You also have a 30 year treasury bond that I so loved and told all of you that I thought you should absolutely go into it because interest rates were going to go down. You would make money there and make the interest rate in the meantime. They're at 4.7% now. I don't know if they're going to go down, but I would not be buying them at this point in time. I still like the middle curve, the three year, five and seven years, because you never know what could happen. And as they mature, interest rates now could be a whole lot higher. In terms of the short term, where we were all telling you, you got to get out of money market funds, money market funds are going to go down and down and down. Hey, you want to leave your money now in a money market fund or a high yield savings account paying you a decent interest rate, I don't have a problem with that at all anymore. It's impossible to predict that this was going to happen. In fact, nobody thought that what was going to happen last week happened when it came to interest rates. So now we just have to see really what happens with inflation, where interest rates go, how everything is affected and make our moves from certainty versus being uncertain. Because you have to be uncertain now because there's certain people in power that seem to be uncertain as well. However, when you have diversification, which means you have some money in bonds, okay, but you have money in stocks, dividend paying stocks, whatever it may be that you are certain about, then no matter what, I really think you're going to come out ahead. So don't let your uncertainty about situations sabotage your financial wealth. That could probably come years from now. Before I end, I want to talk about Bitcoin. Now I get there's a lot of controversy about Bitcoin, about any crypto. A lot of people don't like it. A lot of people don't like that I talk about it. But remember everybody, what have I always said to you? You only invest with money that you can afford to lose. But the misunderstanding is that because bitcoin, let's say, is around 100,000 or wherever it goes to, right. That for you to buy Bitcoin you need $100,000 to buy a bitcoin. That is not true. You can buy $100 a Bitcoin, $200 a Bitcoin. The actual bitcoin, you could do it at PayPal at many different places. You can do that. So that's one thing misunderstanding there big time. I personally only buy bitcoin now through an exchange traded fund by the name of IBIT I B I T which I've told you all about. Now, while it's true when bitcoin soars, the ETF does not go up as much percentage wise as the actual coin did. But I just personally feel safe doing that. And even there you don't have to buy an entire share of something. If you have an account at Fidelity or Schwab or any of the firms Robinhood that let you buy slices, you can call up and say, hey, I want $20 of Ibit. Ibit. So you don't have to go in with a whole lot of money. Just so you know, for those of you who do not follow me on the Women in Money app, which you can download by the way at Google Play or Apple Apps, a lot of times I will go on and I will say certain things about what I think is going to happen. And I did that with bitcoin. I was concerned that if bitcoin did not hold over $100,000 of Bitcoin that most likely it was going to go back down down again. However, bitcoin went down and then it went all the way up to 108 and that didn't bother me. I was just patient. Then it went all the way back down to like 95 when I bought in again with Ibit. However, I also posted on the Women in Money app, hey, maybe now might be a time. Now it's very possible that bitcoin could go back down even further. I do believe that over the long run here I would not be surprised to see it at $125,000. Now I don't know if that's going to happen. That's not going to happen. I have no idea. But I don't think it hurts. With money that you can afford to lose and you want to try a little of it. $100, 200 doesn't matter. Okay, I don't have a problem with that. But it's not like I'm going hog wild and putting a whole lot of money in bitcoin. I am not. Just so you know, I wish all of you, seriously, a very, very Merry Christmas and a happy Hanukkah. I hope that it's a day, whether you're alone or with family or whoever, just your pets, that it's a day that the greatest gift you could give yourself is the gift of self love, the gift of truly valuing yourself, the gift of standing in your truth, and the gift of just being proud of who you are. I hope that's the gift that all of you unwrap for yourself on that day. All right, everybody, there's only one thing that I really want you to remember when it comes to your money, and it is this. People first, then money, then things. And if you do that, stay healthy and stay strong. I promise you, you will be unstoppable.
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Unstoppable Theme Song
I'm unstoppable I'm a push up with no brakes I'm invincible say I win every single day Mine's all powerful I don't need batteries to play I'm so confident yeah, I'm unstoppable today Unstoppable today Unstoppable today Unstoppable today I'm unstoppable today.
- [25:14]
Suze Orman
Hi everybody. Suzy O Here now. If you are looking for a way to start saving to get the most out of your money, I want you to go to myalliant.com, that's M Y A L L I A N T.com and look into opening an ultimate opportun savings account. Put in at least a hundred dollars a month every single month for 12 consecutive months. Earn 3.10% interest on your money right now and get $100 at the end. Are you kidding me? It's the best deal out there. Start saving right now.
- [25:52]
Podcast Host
Neither Susie Orman Media nor Susie Orman is acting as a certified Financial Planner Advisor, a certified financial analyst, an economist, cpa, accountant or lawyer. Neither Suze Orman Media nor Suze Orman make any recommendations as to any specific securities or investments. All content contained in this podcast is for informational and general purposes only and does not constitute financial, accounting or legal advice. You should consult your own tax, legal and financial advisors regarding your particular situation. Neither Susie Orman Media nor Suze Orman accepts any responsibility for any losses which may arise from accessing or reliance on information in this podcast and to the fullest extent permitted by law. We exclude all liability for loss damages, direct or indirect, arising from the use of this information. The must have documents discussed in this podcast are legal documents created by a lawyer and distributed by Hay House.