A hearty welcome to “Grandma’s Wealth Wisdom” with your neighborly hosts, Brandon and Amanda Neely. This is the only podcast that helps you take charge of your cash flow and leverage your assets, simply and sustainably, the way Grandma used to.
Amanda: Hi, it’s Amanda Neely, and welcome to Grandma's Wealth Wisdom, where we help you break through to a smart, stable financial feature, using the tried and true wisdom Grandma used.
Today, we've got a very special episode for you. It's episode no. 63 with Judy Li. How's that for rhyming? We didn't even intend to do that when we set out. I’ve titled this episode “Do What You Like.” We've got a really great conversation ahead and this idea of doing what you like, as you listen, look for times when Judy is choosing to do what she likes and making sure she can continue to do what she likes going forward. Hope you enjoy, and I’ll catch you at the end for a little bit of a wrap up. [01:08.9]
Welcome, Judy, to the Grandma's Wealth Wisdom podcast. It’s great to have you here.
Judy: It is great to be here.
Amanda: Give us a little sneak peek into who is Judy? And why are we talking today?
Judy: So, Judy. I am a woman who lives in Chicago. I’ve been here for about five years and have been exploring kind of a career and impact, and I’ve been interested in environmental sustainability, so that's been a key driver for a lot of my interests and career path, and a lot of activities that I like to get involved in.
On the side, when I’m not working or doing other stuff I have to do, I like to have a little houseplant garden situation, so I like to work on them. [02:03.8]
I like to go out and be active outdoors, COVID-allowing, and kind of think through, think through how I can have a good impact on the world, whether that's through volunteering or through whatever I’m doing at work.
Amanda: Yeah, I think that's how we met. It was through one of those impact organizations that was hosting a networking thing, and we met that way and connected because we had similar passions regarding making a positive difference in the world and environmental sustainability.
Take us a little back. What brought you to seeing that as the main thing you wanted to do with your life?
Judy: I was fortunate that I grew up in Southern California really close to the Pacific Ocean, and so, like many kiddos growing up., I wanted to be a marine biologist or an oceanographer, or something outdoors and on the water, and that kind of stemmed into just an interest in general. [03:05.4]
It's nature and outdoors, and then interest in conservation turned into interest in climate change and environmental justice, and all kinds of other issues related to that. So, it really started from just really enjoying being outside as a kid and I still enjoy that, so it's still here.
Amanda: Good. Awesome. When you enjoy nature, you want to take care of it, so that you can keep enjoying it. It makes a lot of sense to me.
We knew each other for a long time before I transitioned into what I do now, and I remember I had told you about the concept that I work with now and how it impacted me and way before this was ever my profession, and I introduced you to a financial professional that you could work with. Tell us that story and what it was like to meet him and start talking with him, and why it ultimately didn't work with him. [04:03.2]
Judy: Yeah. I think I always knew that I wanted to be more actively managing my money. It's not like I make a ton of money at work, but I come from a family that really likes to save, and so that's kind of been ingrained with me for a long time, and so the value of saving money, really important.
Then, growing up, my parents did look into stocks and mutual funds, and these other ways of investing, and so it's always been something that I’ve wanted to learn more about and practice with the limited amount of money that I had to work with. I’d heard for a long time that you need to start early, and so I’ve been thinking about this since I moved to Chicago that I should eventually start to think about my money in a smart way and do something with it other than keep it in a bank account. [05:08.1]
So, Amanda, you introduced me to a friend of yours who is also a financial advisor and we were exploring some different things that we could do together. Ultimately, I think that it was, you were looking at things that were not traditional and I’m open to that, so nontraditional ways of growing your money, of keeping your money more secure, so it's ready for you when you want to use it in the future.
It was hard for me to move forward with that with somebody who I didn't know as well, and even though I really liked this individual, there was nothing that he did or said that made me uncomfortable per se, but it was just the fact that this is a kind of difficult topic. It's a sensitive topic. You work hard for your money and you don't want to do anything that you aren't super sure about. [06:08.9]
So, I think I couldn't move forward on some of those strategies that he had outlined, just because I wasn't ready to move forward with someone I didn't know as well with things that I was less familiar with.
Amanda: Yeah, that makes a lot of sense. Then, of course, I got into this role and I’m just speaking freely, it was a little awkward for me to be like, Hey, Judy, we're friends. Do you want to talk about money with me? And I get that. There are lots of people that I would consider my friends that are like, No, I just don't talk about money with friends, somebody I know. For you, from your perspective, what was it about me bringing that subject up that you were like, Yah, I could totally talk to you, Amanda, about that?
Judy: Is the question about what it is about you and our relationship?
Amanda: Or just in general, why do you feel more comfortable or what is it about talking with friends about money that is more comfortable than talking with a stranger? [07:04.4]
Judy: I would be one of those friends who would be happy to talk with my friends about money obviously, and I think that it's because there's a certain level of trust with friends and it's that, if you respect our friendship or suggest things that are in my best interest, it's kind of my philosophy around that.
Because I already had a friendship with you and a few years of just knowing what you were up to and everything, I did trust your judgment with the suggestions that you were providing because they were also things that you've contemplated yourself doing, and so if you decided to do it and I think you're pretty smart, then I’m going to pay attention to it. [07:56.0]
You've not only considered doing it. You've done these things and they've proven to be effective and work as intended for you, and so I trust that for something that is a little less familiar and less people do or just a more creative way of thinking about your finances. It is helpful to be working with somebody who has gone through the motions themselves, too, and done something similar.
Amanda: That makes a lot of sense and I agree. That's probably why I started working with a financial professional when I did just a few years before, because I had built that trust and I felt I could trust him, and on a different level before I said, Okay, now I’m ready to talk about money.
We started working together. What has that process been like? What have been some of the things you've enjoyed? What are some of the things that have been more difficult?
Judy: There's nothing that you've done that made it more difficult. If anything, I’ve made it more for myself. I think through things a lot sometimes, and so I think this stuff is naturally difficult because you have to make decisions and then you have to do it, and then you have to… [09:08.8]
It's real. It's your money that you're either investing or putting somewhere, whatever, and I think that feeling, almost feeling your risk tolerance on how much you want to do, when, how far you want to go in there versus diversify, whatever it is, that can be hard to think through because it really is dependent on individually my own comfort level. So, that can be challenging because it just takes time and it takes time to think about, be real with yourself.
But the thing that I really enjoyed working with you is you're super on top of it all the time, so I feel if something's not happening, it's not because of you. It's because I’m just taking a long time, figuring my stuff out. [09:56.7]
Also, it's great to talk with you. I feel even if we didn't know each other as well, just your personality and your presence, and how you ask questions in order to make sure it's something that I understand and also want to do, is really great.
Amanda: Thanks. You're really easy to talk to as well. I’m remembering some of the conversations we had when COVID hit and the stock market was going kind of crazy. Do you want to talk about those at all?
Amanda: Because you have this really interesting thought process that I thought was really awesome that you shared with me then in terms of what you think the future of the stock market could look like, and particularly knowing that you do have a cool perspective on it. Maybe some of that philosophy, that kind of thing, do you mind sharing that with our listeners?
Judy: Sure. I mean, for what it's worth, I’m not an expert. Okay, my thought was I had some money that I’ve wanted to invest with and I had a feeling when COVID was first kind of becoming a big concern in the United States. [11:12.5]
I had a feeling and also the stock market tanked in late-February 2020, and I had a feeling that it would actually, it could be volatile for a while. Amanda, you and I talked about this, too, thinking about what the possibilities might be, but, yeah, the stock market could be volatile. It could keep going down. It could come up and then down, whatever. We don't really know. I had a feeling that the severity of the crash and the jobs that were going to get lost and the businesses that we're going to close and everything ahead of that, it could lead to a recession or something like it.
So, my view was I wanted to deploy some capital into the market, but I didn't know when would be the right time to buy stocks and things to kind of capture the lower price in hopes of future growth. [12:13.0]
I also wanted to be strategic with the vehicles that I had. There was a Roth IRA that I could fill up. There was just investing in the stock market, and in investing in the stock market, I also wanted to keep my investments more long-term, so buy something that would keep it for at least a year.
So, with that in mind, my strategy was let's try to be paced about how much capital, how much money I put into the stock market and my Roth IRA, max that out, put money into the stock market and try to do it. I think I decided to do it to put in money once a quarter for six quarters. No, four quarters. A little over a year, I think, was my plan from when I would start. [13:10.5]
That way, who knows what direction the stock market would take, but I was spreading out the risk instead of putting all of the money in at any particular point. Something we had talked about was also, it might take time for the stock market to reach its actual low just because and we've seen it thus far.
There's been a lot of people going into the stock market and stock prices have continued to increase in a lot of things, which is kind of surprising given the economic situation and the rate of unemployment. So, the big question still is, is the stock market going to readjust to actually reflect more of what's going on in society and the economy, who knows? But that's kind of why my strategy is to put in a bit every quarter kind of regardless because we can't really tell the future. [14:06.2]
Amanda: I think that's the bottom line now. You don't know what the future holds, so you transfer the risk as much as you can or mitigate it. Kudos to you for coming up with that strategy to spread out your investing rather than do it all in one big chunk. That sounds really good.
Judy: I was really uncomfortable with doing it all in one chunk at any time, now, later. I don't know if I could have gotten comfortable with any other structure.
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Amanda: Tax-wise, holding it for a year, that sounds like you're thinking about taxes and how you can get capital gains if you wait and things like that.
Judy: Yes, that's right. The capital gains tax is the consideration for that, and then in the Roth IRA, I’ve been having a little more fun in there because you can buy and sell without tax implications. I don't spend a ton of time doing stocks because I just don't have…either I don't prioritize it enough where I don't have the time, but when I do, it's kind of fun to just play around in the Roth IRA because of that no tax on capital gains situation for that account.
Amanda: Yeah. We're pretty upfront that we're not telling you what stocks to buy, or any index funds or mutual funds. How does the work that we do together help you do what you want to do in the stock market, better or worse, I don't know? [16:02.1]
Judy: Something that we're trying out is the concept of having, using whole life insurance and investing in the stock market. The reason I like this is because the benefit of whole life insurance is that you can keep the money in there and then it will grow as part of that policy, that whole life insurance policy.
The value of the money will continue to grow maybe at a lower rate than some really high fast gains in the stock market, but it's there. Then you can borrow off your policy and put that money into the stock market, so that the stocks kind of grow in there. So, you kind of have money growing in two places as a result, and this might be getting into the weeds, but part of the whole setup is that by taking a loan on your policy and whole life insurance, you do have some interest that comes in as part of that. [17:02.9]
But then, if you're expecting your money in the stock market to grow more than that interest, it's kind of worth it, and you can't ignore the fact that your money in the whole life insurance policy is also still growing, so you still have all of your money growing. Even though you have a little bit of interest, it's still worth it, and that was my calculation.
I think that's one of the cool things. We can also talk about how whole life insurance kind of policy in your financials can help with other kinds of large purchases. Kind of using it for the stock market play is one way.
Another thing that I’ve been thinking a lot about is, maybe this isn't the case during COVID, but when it comes to renting places for living, renting apartments versus buying a unit, a lot of the times, it's just do you have the money upfront to buy, to get a loan to buy the unit versus constantly renting. So, when you look at the math, renting a unit is more expensive than the mortgage payment you would have to pay if you buy kind of a similar unit. [18:11.8]
Maybe that's not the case everywhere, but it's similar enough where if I could use my whole life insurance policy to help provide capital to buy a unit that I want to live in instead of renting it, that could also be pretty valuable because then I would be saving over time on not having to pay the higher rent. I’d be paying the mortgage, but then that loan on my policy still leaves that amount in my whole life insurance policy to continue to grow.
That might be way too in the weeds, but there are just other large purchases that might or might not happen in the future that I kind of just have the ability to loan out of the whole life insurance in order to cover it.
Amanda: Yeah, and you never know what those future large purchases could be. They could be a home. They could be something else. [19:02.9]
As you think about your future, what are some of the things you're hopeful for that you're looking forward to? Maybe that relates to your finances or maybe not?
Judy: I’m looking forward to seeing how this stock market play plays out. I mean, who knows how the stock market is going, but we'll stick with it, stick with the plan. I have my eyes on the horizon on a wedding in the future. I’m engaged.
Judy: Thank you. Somehow we're going to have a wedding of some sort, and so the costs who knows what that's going to be? But that's something big.
At one point, a couple of years ago, I was thinking to go to apply for an MBA or to not. For the moment, I’m not because it looks like there's a lot of opportunity with my current job, but if that were different, that would be a really big commitment financially and also time-wise in your life to go to school for a couple of years. That for now is not happening, but it was something I was considering before. [20:19.0]
Then who knows with life. I already mentioned about moving places and [inaudible] that you live in. If it's going to be a place that I want to live in for a longer period of time, that would ideally be the situation where I try to own a place instead of continuing to rent. So, that's kind of exciting and something I’m hoping that I can position my financials in order to make that possible.
Amanda: Sounds good. I know you've studied entrepreneurship a lot and a lot of our listeners are entrepreneurs or maybe intrepreneurs in their jobs. What would be your advice for someone thinking about entrepreneurship or maybe already starting that? In terms of what you've learned, what should they always remember? [21:10.2]
Amanda: I put you on the spot with that question.
Judy: Wow. I’ve found that I have pursued different kinds of projects, whether they could turn into a business or they were never meant to turn into a business, whatever it is. Then my experience with entrepreneurship is also that I work for a venture capital fund, and so I am working with some pretty successful entrepreneurs, some pretty inspiring entrepreneurs as well through my job.
I guess from my personal experience, having never actually turned an idea that I had into an actual company that my learning from that is that it also depends on why I’m trying to do it. [22:00.0]
I am driven by a larger desire to make a positive impact in whatever it is, but a lot of times I turned to that when something wasn't quite satisfactory with my current job. Whatever it was that I was currently spending a lot of time doing or thinking about, if I was feeling a little unsatisfied about it and feeling like there was less room to grow there or whatever it was, then my brain would start thinking about other things that I might rather do.
That was my learning, and ultimately those things were things that I thought were kind of interesting, but they weren't as well thought out that then became businesses, and I never really took the leap on them because it just never became something that I was either driven enough on in order for it to be a whole new thing by itself.
I think it was partially because of the reasons why it came about. If it came about because I was dissatisfied with something, that's not a good enough reason to actually start a company. It has to be a really well thought out, both on what the company is going to do and also on your passion for it. [23:15.1]
I feel my passion for it was not necessarily there as much. It was more so I would rather do this than this other thing, but that's not a good reason. That was one thing kind of really understanding what it was that was pushing you to do this. Is it because you're actually in love with the thing that you're pushing forward or is it just because it's a cool idea that you were driven towards because you didn't like something else? I don't know if that's it okay answer.
Amanda: No, that's a great answer because I feel like I know people that were starting side hustles because they were just dissatisfied with their full-time hustle or they're two different part-time hustles, or whatever they were doing and that side hustle became… I think when you do that, it becomes something that is also dissatisfying and it can't last very long because you are getting into it for the wrong reason. I’ve seen that happen. I think that's a really good piece of advice to be thinking through. Cool. [24:14.7]
Any other parting words of wisdom from you for our listeners?
Judy: Parting words of wisdom. I mean, I do want to say Amanda is awesome. But, okay, words of wisdom. I don't know, just do what you like. I feel like so many times we get stuck in doing things because they feel like things that we should like or are easier. They seem safe and there are times where that's really valuable, but if there's something that you would rather do, lean into that and really feel it out like how we were talking about before, hear out why you want to do it. But if it's for the right reasons and it's something that you can do, just explore it, kind of take care of yourself, so you can have that space that clarity to hear yourself and what you want. [25:06.2]
I’ve been working on that for a long time, all the time. I feel like I’m not quite there yet, but I’m working on it, but it's something that I think, if more of us were able to take care of ourselves so that we can have that space to hear ourselves and what we want and really pursue those things, we'd be in a different place.
Amanda: Thank you for sharing that. I love that we've kind of come full circle in a different way than people might expect, because we started out with impact and now we're talking about doing what you like and self-care, but those are totally intertwined and that's a big part of my story as well.
Amanda: Thank you for joining us and I’ll talk to you again soon.
Judy: Talk to you soon. Thank you, Amanda.
Amanda: Thank you.
Judy: It was great to be on this.
Amanda: Did you catch all those things that Judy likes to do and how she's aligned her money with those? She started with talking about how her family is a family of savers and they have always been savers and also wanting their money to grow, so that's become something that she likes to do as well. [26:08.6]
Then, she likes kind of having both and a financial strategy where she can have safe, secure, accessible or liquid money that she's able to use, and she can put some money at risk and play around with it in the stock market, which is exactly what you're doing when you're in the stock market. You're playing. You're gambling and she has that both, and to be able to do that because she likes to.
She also likes to make some big purchases, like purchasing a home rather than renting, getting married, maybe getting an MBA. Keeping her options open sounds like something she likes to do as well. I love that she brought it to the close there with finding something you like to do and pursuing it, whether that be entrepreneurship or outside of entrepreneurship, what you do in your work, how you manage your money, what you want your money to do for you. [27:08.2]
Getting clear on what it is that you like and doing that, and making sure that's why you're doing something, not just because you're dissatisfied with something else. I love the word she used “explore” that that really is an exploration type of process.
Often something that doesn't happen like that, if you could hear my finger snap, that's not how we explore and find what we like. It isn't like a snap. It's more of a longer process and we can't rush through that. That's something that I’m talking a lot about more over on our other podcast that was released this month called the FIFE Movement Podcast or the FIFE Podcast.
As of this recording, it hasn't officially been released, but it's out there now. Be sure to check out the link in this episode, if you want to check out the podcast where we're doing a little bit more exploration of what does financial independence mean from a feminine and entrepreneurial perspective? [28:16.5]
They’re a very different style from the Grandma's Wealth Wisdom podcast, but I think if you like this one, you'll like that one, so check it out again. Again, FIFE, F-I-F-E, just Google or just put into your podcast searcher and you should find it.
Okay, I’ll see you over there or I’ll see you next time for Grandma's Wealth Wisdom. We are done with interviews. We're bringing back awesome content about different financial things. We're going to start digging into some history and telling some stories about money that you might not have heard before, but are absolutely true, at least as best as we can find. Hit that subscribe button.
Until next time, keep building your wealth simply and sustainably, so you can break through to a smart, stable financial future. [29:04.6]
The topics presented in this podcast are for general information only and not for the purposes of providing legal, accounting or investment advice. On such matters, please consult a professional who knows your specific situation.
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