Episode 19 – How to Pick Stocks During the Stock Market Dip

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Episode 19 – How to Pick Stocks During the Stock Market Dip

Podcast Transcript Below

Hello everybody. Welcome to the Unicorn Millionaire Podcast. I’m your host, Charly Stoever. I’m a non-binary Latinx money coach, helping my first gen clients become millionaires. I’m a formerly undocumented Mexican American and currently digital nomad traveling all over the world. Super excited to have you here along with me on my journey.

I talk about personal finance, money, mindset, twerking, unicorns, rainbows, you name it. We’re here, we’re queer, and we are going to build wealth for ourselves and our communities.

I’m gonna talk about what to investing so. Oh, I’m just laughing cuz I can’t believe my life. A week ago I was shaking my ass at a pool in Palm Springs for like four days surrounded by my amazing friends and new friends and all these hotties and I’m just still riding the high from that experience.

I’m calling it the Dinah Shore effect. Cause like me and my friends noticed how productive we were and focused in our work afterward and I was definitely creating and drawing. I might have drawn a hottie or two. My writing coach even told me to as an assignment for my graphic novel to draw. Uh, cause I wanna draw my characters in my, uh, biography Graphic novel as if they’re magic mushrooms.

Cause I believe everybody is magical. Some people are just more hurt than others. Some people are more willing than others to do the work to embody their full selves and be in alignments. And I recently discovered that there’s bioluminescent mushrooms and she was like, draw these hotties, like they’re bioluminescent.

Cuz I went through a lot of difficulty as a kid of immigrants, formerly undocumented. Uh, and I wanna just, Have the highlights of my life and Dinah Shore is definitely one of them. Uh, as like a bioluminescent mushroom and being surrounded by other bioluminescent, hotties. So yesterday, even though it was a Sunday and I was supposed to rest, I was drawing like crazy all day long and I was also on duolingo learning some Mandarin because I’m going to Taiwan in a week now.

This is wild. And yeah, just doing duo lingo reminds me of how much I love languages. I’m a language nerd. I’m a lifelong learner. And the bonus with Chinese is that it has thousands of cool drawings. So I was like, oh, this makes sense that I would enjoy learning this language because all the languages I’ve learned have been the easier ones, in my opinion.

The romance languages, since I grew up speaking Spanish is hella, easy for me to learn Italian and French, but Chinese is super different, even though my language learning brain is still trying to be like, what sound, what word? Sounds like the words in English or Spanish. Um, so that’s super cool. And, uh, I’ve just been scheduling emails and getting some things done creatively, prioritizing, drawing and dancing and being creative earlier in the morning instead of later in the day.

Um, and what else? I’m gonna go on a coach’s retreat on Thursday. I’m renting a car to drive to Palm Springs, I’m gonna stay for a few nights, but before that I’m gonna drive to Joshua Tree National Park, which I freaking love. Joshua Tree. That ish looks like Mars. It looks like a different planet. I worked as a cross country tour guide driving, uh, a van, a Ford Transit and towing a trailer and camping from New York to LA with passengers mostly from Europe and Australia.

Basically mostly white people that could afford to travel in the US cuz it’s super expensive to travel here, but one of my favorite places to go was Joshua Tree National Park. I don’t think I would have ever ventured to go all the way out to the California desert if it weren’t for that job.

But, um, even though that job did not pay well at all, I saw it as an investment because it helped me see parts of the US that I would’ve never gone to, like also Florida, which apparently I love Miami . But yeah, I’m gonna go to Joshua Tree and I’m excited because apparently you can drive in even after it closes at 5:00 PM you can drive in at night and star gaze.

You’ll get fined if you sleep in your car, obviously, which who wants to do that in the desert when it’s freaking hot. Um, but I’m excited to just go later in the day when it’s not as hot and to see the stars because being in cities mostly because they’re more LGBT friendly, I do miss the combo.

I miss the stars, I miss fresh air and putting my feet. In the ground and feeling grounded. That’s something that’s super important to me. Now, even just like being in the valley right now in la, I’ll literally walk and put my feet in the grass and like hug the trees cuz I don’t care. There’s some cool banana trees outside where I’m at right now.

Um, so yeah, I’m super excited to take a California road trip to Joshua Tree. Listen to some 1970s classic rock. The Eagles. Basically white people music that I grew up with, cuz I grew up in Eastern Washington state and I feel the nostalgia for that side of me. But I’m also gonna be listening to like cumbia and Megan Thee stallion and have all these, all this, this music to myself and enjoy, uh, the night in Joshua Tree before coming back to Palm Springs for a weekend retreat in person with other coaches.

Which I’m super excited about. I love in person shit. Especially as a digital nomad, it can be really isolating to just be traveling with all your stuff from place to place and constantly meeting people and introducing yourself. And I love my online business because I’ve gotten to meet a bunch of you in person after we start working together, but it just does hit different, uh, meeting coaches in person.

Which reminds me that I think my life mission is to eventually have an in-person retreat center. Buying property right now doesn’t make sense for me just to have a house. To have a house. But if I am to invest in property and real estate, it will be to have a retreat center where LGBT, BIPOC, first gen folks can just come and relax and unwind.

Because I feel like the whole retreat space has been a mostly white, hetero dominated. Area, but I feel like we are the ones that deserve retreat centers the most, not like rich white people. So yeah, a lot of, a lot of things are, are brewing and I’m excited to go to Taiwan and take the month off. I’ll still be sharing and sharing my drawings because I feel like I’m gonna have a creative explosion when I’m there of just drawing everything.

And really learning Chinese, I’m just so excited to be dropped into what feels like it’s gonna be on a different planet, and I’m super excited to be outside of my comfort zone, uh, and to learn and share with other people. And I am nervous because I only know like two people in Taiwan, things are, are starting to reopen barely as of last month starting to reopen to extranjeros.

So there’s not gonna be a lot of extranjeros, which is why I wanted to go there, which is why I’m going there first and not Thailand because I don’t feel like it’s as overrun by tourists, uh, and like the Australians as Thailand and Vietnam and all those places. But I think it’s gonna be a good gateway to the rest of Southeast Asia, and I’m excited for pride at the end of October in Taipei because Taiwan is the only country that has legalized same sex marriage.

I’ve been studying some Mandarin, but I’ve also on my Kindle paper White that I just got, cuz I realize I freaking love reading. I’ve been reading about the history of Taiwan. It’s very interesting the kind of limbo that it’s been in. Like some presidents have been like, yeah, it is part of China. But then the current president who is descendant from aboriginal people from Taiwan, she’s like, no, we are not part of China.

And there’s just like this tension. And also just the fact that she’s like a boss. She’s like a, a woman president and they actually were taking care of their people during Covid and they have universal healthcare. And all of these interesting things are what are drawing me to this place.

And I’ve had some friends who are like, yeah, it’s an awesome place to be. It’s safe. People are welcoming. Um, I’m surprised there’s not more people visiting, so I’m excited to go for that. So that is my life update. Things are unfolding. I feel like quickly since I’ve developed a better relationship with time, and I’ve realized that I am the creator of time, instead of letting like time dictate me, I am better able to feel like I’m in flow with time and be more creative.

Especially since money is not something that I’m worrying about, and this is something that I talk about with my clients, the more money you make, the less you worry about money, but you start worrying about other things. But you have the opportunity to live your life’s purpose and feel in an alignment and trust that you can still make a living from things that make you happy.

And that money is going to be an after effect because we were raised to prioritize working for the money as the goal. But then once we’re leveling up and we have the money, we realize that that doesn’t create happiness. It does create stability and safety, but there’s always something more hopefully, that we should be striving for.

And our life’s purpose changes all the time. A year ago, I had no idea I was going to be hiring a writing coach to help me with a graphic novel and that I’d be drawing like bioluminescent magic mushrooms and be planning a trip to Taiwan. So that’s, that’s where I’m at right now. But I also wanted to talk about what to invest in because, uh, I’ve been checking my investment accounts every time I look at my investment accounts, that shit’s been red.

The stock market has been down all freaking year. And it’s the time to buy or hold. My strategy right now is to hold because I’m still just working on paying myself consistently through my business and building up my emergency fund. But once you have that emergency fund build and you have that leftover cash, that’s when it’s time to start.

Thinking about if you haven’t done so, opening a Roth IRA and I have master classes at my website, uh, on my blog. Unicorn Millionaire just launched that. I have master classes on credit cards, Roth IRAs, brokerage accounts, but then I wanted to also host a masterclass before I go on vacation for my clients and anybody else who’s interested in learning this masterclass is open to anybody who wants to learn about ok, now that we have our investment accounts open, what the heck do we invest in?

And I don’t like to just give people blind recommendations because that’s unethical. I can’t tell you how many people would call me when I worked as a stockbroker and just ask me straight up what to invest in. It’s like, bro, you don’t even know me.

I don’t even know you. I don’t know your situation . I’m not just going to be some random person on the internet telling you to buy stocks. That’s, that’s unethical to me. And I actually don’t recommend stocks specifically to my clients because I want them to understand how to shop for stocks on their own, so they understand how to pick the different options.

So, and another thing I wanted to mention, um, is that you’re on the right track. Especially clients that have worked with me for the entire six months, sometimes they’ll come back to me, uh, for coaching calls because they’ve referred me to a friend and I’ve had some clients say, I feel like I need to learn more about investing.

And then I say, why? And they say, because there’s so much more out there and I see the ticks and whatever in the news. And I’m like, you don’t need to research more. I always give my example of a single company stock. That I’m down almost $4,000 because I thought that I could like beat the market and that I was lucky and untouchable.

So let me go and choose this one stock that was super volatile. The price of a share at its highest was like $19, and then right now it’s like a dollar 60, which doesn’t sound like a lot, but when you have 500 shares, that’s why I’m down like $4,000. But I use that as a non-example to show how dangerous it can be for people to just recommend stocks because they’re not, they don’t have your long term interest in mind and they’re just throwing around recommendations.

I love TikTok, but I also want people to be informed about how to choose among the different options and really understand what they’re investing in already. If you already have a 401k, do you understand what you’re investing in within the 401k? Are you maxing out the contribution of $20,500? Are you doing pre-tax contributions or Roth 401k?

These are all things that I’ve helped a client with. Katie who had extra cash, wanted to get better at investing, and before we were even talking about investing, we took a look at her retirement account and she decided to contribute about, she went from contributing something small, maybe about 8% from her paycheck to her retirement account, to something like 37%.

And that’s a really quick, easy way because you’re already investing. A lot of you are already investing and you’re not even thinking about it. So that’s a reminder that you’re already doing more than you think. But then we also looked at her investments for her to understand what she was investing in.

I see a lot of the times people have target date funds, and these are funds that if we go into the 401k and has a date like 2055, 2045, 2030. 2020. These are all funds that you’re paying a team of mostly rich white men to manage for you. So now it’s really aggressive investing in stocks and stuff, but then by the time you quote unquote retire at your 2055, it’s basically converting all to cash.

But those are usually more expensive than the funds that that I buy into. One of my clients, Diane, we were looking at her 401k and she had just started a job. Wasn’t contributing too much yet cuz she just started, but I’m glad she was taking advantage of the stock market dip to contribute. And I was like, okay, do you understand what you’re investing in?

She’s like, I have no idea. Okay. So we looked and she was investing in a 2055 target date fund, and then we looked at. The chart, the information, when you click on the fund itself, don’t let it overwhelm you. What I look for when I wanna find out about a fund, even if I’ve never heard about it, I just want to know how has it done over the long term?

By long term, I don’t mean three months. I mean five years. When I’m investing in something as an investor, I want to know how it’s done as far back as possible. We’re talking five or 10 years if possible. And it better be doing better than it was five or 10 years ago, despite stock market, uh, dips and crashes. So there’s like percentages and charts and all this information.

I’m like, we don’t need to worry about that. I just want to see the chart and see how it’s done over time. The stock that I’m telling y’all that I’m, I’m down like $4,000. That ish. I invested in knowing that it was gonna be risky and I took the risk anyway.

Again, I use that as a non-example. We all make mistakes and, and the purpose of that mistake was for, for y’all to learn from it as well. And when I look at the chart of that stock, it is so volatile. Like I said, $19 to like a dollar now, and it’s just been going down for months. But other index funds, other funds that track the stock market and are more diversified, meaning you put more eggs in the one basket instead of just depending on one company that can go bankrupt, that should be tracking and increasing slowly over time.

Um, regardless of, of stock market, so this is what I show clients. Let’s look at the chart and see how it’s done over time. Don’t worry about the ticks or the fomo. Let’s look at the chart. The other thing is the fancy white man word called expense ratio. That’s basically the cost. That’s nothing like I’m a money translator.

I’m like, this is the, the white man word. So we wanna look at the chart. How has the investment done over the long term, several years, and how much are you paying this team of like white people to manage this fund for you? The expense ratio is a percentage that’s embedded within the fund itself. So for I think, Diane, we looked at your 2055 fund and the expense ratio I believe was 0.65.

So that means that $6 and 50 cents of every thousand dollars you’re paying to this team to manage the fund for you, which doesn’t sound like a lot, but when you have tens of thousands of dollars building over decades, that’s going to be more money in their pockets. But you also won’t have to worry about selling your investments the closer you get to retirement.

But selling is not as complicated as it. You just have to learn what your risk tolerance truly is cuz everybody likes saying they’re aggressive when the stock markets popping,

I love to say that. And then when the stock market dips, you find out your risk tolerance real fast.

And, uh, Diane saying me immediately calling Fidelity to get that shit changed after our call. Heck yeah, that’s what, that’s what we talked about during our call. That’s what they’re paid to do as a stockbroker, I was paid to answer people’s calls and they could call us as many times as they wanted to get information for free.

But like I said, it’s mostly like rich white men that know what questions to ask when they call these brokerage firms and they advocate for themselves and they get their answers and yeah. So we need to feel that. Even if we feel like a fourth of that level of entitlement, we can get so much shit done , but that’s what these 1-800-NUMBERS are for, is to call them and ask questions for free.

You can’t be calling them to be like, what should I invest in? Cuz that’s unethical. They shouldn’t even be telling you this anyway. If they do, they don’t know what they’re doing. They should be walking through the portfolio builder tools for you to pick the investments and also ask. Okay. As I’m like, explain this to me like I’m a five year old.

If they can’t explain it to you like you’re a five year old, then they don’t really understand it, which is why it’s really important for me to just explain this ish as simply as possible because all these expense ratio and 52 year high and low, all these fancy words are just meant to exclude people, especially when the stock market crashes.

It’s meant to exclude people and create fear. That’s why when stocks are down, that shit’s in red. Even though the stock market is made up from people’s minds, it’s not actually red. It just turns red. And then people who don’t understand it freak out and they’re like, oh, red is bad. Sell, sell, sell. But I actually see those colors opposite.

I see the red as green. Green means either hold or buy cuz it’s low. When the shit’s green, people get the fomo and they’re like, oh, stock market’s so great right now, but I missed out how, but should I buy? I’m like, sell, sell, sell. So I see the colors in different ways, like the opposite ways, and I hope that helps you conceptualize why they even give the stock market colors in the first place.

In my opinion, it should be gray, but they have colors for a reason so that people can get all emotional and feel like investing as a casino in short term. But it’s not like we’re in this stuff for the long term.

For example, when I show my clients my accounts, because a lot of us are visual learners and it’s important for us to see how I organize my investments, cuz that’s what I was exposed to as a stock broker. I saw thousands of people’s accounts and it made me feel like it was possible for me to invest in multiple accounts and organize them in a more strategic way for me.

But I show my clients. Like 2021. I was selling my stocks. Shit was popping. My stocks were growing, growing, and I was selling thousands of dollars to pay my bills to pay for my business coach. Pay $3,000 for this. Sold Tesla. But since 2022 started, my stocks have gone down. So at as high my stocks, even after selling them thousands of dollars, the highest is like a hundred thousand dollars, but now the stock market’s slightly higher today, but now the stocks are valued at around $90,000.

That’s almost a $20,000 dip in just a few months. But I’m not sweating it because my net worth doesn’t define me. I’m not a better or worse person depending on how my stocks are doing. And I’m taking this opportunity to show people to stop being scared and invest, even if it’s literally a dollar.

Because I just checked the rate of inflation today, I believe it’s at about 8.3 or 8.5%, which is lower than it was like a month ago. It was like 9%, and that’s basically the rate at which your cash is losing value every year. I’d rather invest a dollar and have that shit triple to $4 in 10 years. Then to have it lose value to like 60 cents in 10 years.

I recently made a post about how if you have $10,000 sitting there in inflation, that shit’s gonna drop to like $4,000 or something. But if you invest it over 10 years, based off how the stock market’s done in the past, DA shit can quadruple in value. But you have to be willing to ride out the storm and ignore the noise when everybody’s losing their shit, when the stock market crashes, cuz it’s going to keep crashing cuz capitalism be capitalism.

And to just hold on or keep buying more depending on your debt payoff plan, how much you have in your emergency fund as well too. So, so that’s, that’s how we should be viewing investing when we compare in different investments. Instead of just like getting your cousins rando recommendation and regretting it three months later, check the charts and check the expense ratio.

How much are you paying this team of white people to manage this fund for you? If you’re not okay with that, then we can show you more low cost funds to investing. So I invite you to join my master class on Wednesday at 10:00 PM No . I don’t do PM classes. What is that? 10:00 AM Pacific, 1:00 PM Eastern. So they have two more days to sign up for.

I’ll put the link in the show notes where I will literally walk you through how to build your investment portfolio, whether you want to do it, self-managed, which means you transfer a hundred dollars, a thousand, 10,000, 50,000 in, and you pick the investments and you buy them yourself. And it’s up to you to sell them when you’re ready and you can do that.

Cause I have a client that’s done, the self-managed, uh, they’ve put in about, I think it was like. 6,000 or 10,000, I think 10,000 in the self-managed. And then we’ve also opened up a robo advisor because they also wanted to just let Schwab do their thing. So I’ll show you how to do the self-managed and the robo advisor, where you tell it your risk tolerance and when you wanna retire, what your goals are for invest.

And I’ll walk you through the questionnaire so that you can understand why they’re asking you these questions. Cuz at the end of the day, these questionnaires are just there for you to understand your risk tolerance. If they get a sense that you’re afraid of stock market dips and dunno what the fuck you’re doing, they’re going to have your stocks be more conservative.

So your stocks won’t fluctuate as much, but you also will lose out on potential growth for decades over time. So I’ll walk you through self-managed new Robo advisor. You can do both. I actually started out with Robo Advisor when I didn’t know what I was doing, and then once I worked in finance, I closed out of the robo advisor and I’m just doing self-managed.

Once I developed more confidence in investing myself, that’s an option and I’ll walk you through how to, uh, place a trade that means, again, fancy Whiteman word for how to buy a stock. Putting cash is step one. But I can’t tell you how many people called me when I was working as a stock broker that were like, Hey, I’ve had $20,000 in my Roth IRA for 15 years.

Why hasn’t it done anything? And I had to break it to ’em and be like, you’re not investing in anything. It’s sitting there in cash. We’re not gonna invest it for you. And it made me so sad and angry, but also motivated me to start my money coaching business so that there’s less people like that so that everybody feels like they know to.

Not only transfer money into these investment accounts, but also do the work Once you understand how it works, to just invest it. Cuz if you don’t invest it, it’s worse. Having cash in an investment account is worse than having it sit in the savings account. His interest rates and investment accounts are trash.

The savings account, you’re still losing value to inflation. Where you’re still paying for the price of keeping your money safer so you can pay your bills and for fifth nine emergency comes, you’re not depending on the stock market for everything. So it’s all about that balance, but it comes with understanding how it works, and that’s why I’m hosting my class.

So I can walk you through on Zoom. Some of my clients are going to be attending and I can’t wait to meet you and have you join my class. So that’s on Wednesday. Sign up at the link in the show notes, and I hope this was useful for you to start normalized talking about investing and having your money at work for you.

All right, I will see y’all later.

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