Throughout the government’s handling of the coronavirus crisis, we’ve seen an unprecedented and severe encroachment on our civil liberties, more so than ever before. Slowly, our freedoms and our ability to live our lives unmonitored and unfettered is being chipped away. 

This isn’t to say there shouldn’t be legitimate government intervention in times of panic. However, we should be worried that what starts out as a seemingly harmless emergency protocol gets manipulated into outright oppression.

This doesn’t just affect our day-to-day lives, it affects our money too. When the government has more control than ever, that can reach right into our wallets and threaten our financial freedom. 

 This is why the times we’re living in are so dangerous, and why we should be protecting  freedom, liberty and equality.

How is the government slowly gaining more control over us, and why should this be a concern? In this episode, I talk about these unprecedented times and what they can tell us about the power structures in America. 

3 Things We Learned From This Episode

Why money is a vehicle for freedomMoney is the provider for you to live the life you want in a free society. The minute the government taxes you, they restrict that ability. If the extent of the taxation is too big, it takes away your ability to live the life you want. 

What makes tax law so important to meTax law is where government control and your money and freedom collide. If we’re not aware of what’s happening, the government’s power will slowly reach into your wallet and compromise your liberty in the process. 

How to defend our freedoms as the government tries to take them awayWe need to make our nation better by taking a stand against oppression, unreasonable control and anything that tries to suppress our lives, livelihoods and liberties.

Changing business models and the emergence of entirely new business models has caused the growth of the independent contractor employment class. There’s always been a lot of back and forth about what to do with this class tax-wise, and in California AB5 was the state government’s answer. 

The problem is this law doesn’t actually bode well for many businesses whose business model relies partly or entirely on independent contractors. 

The law of unintended consequences definitely applies here. 

Businesses won’t be able to hire an independent contractor who will take on the responsibility of paying taxes on their own. There are many problems this will cause to the business, putting its very existence at risk. 

Here’s the truth, an AB5 style bill could be coming to your state next. What does AB5 mean for businesses and what issues will it cause? In this episode, I talk about why AB5 should concern all of us.

3 Things We Learned From This Episode

Why California wanted AB5California is the biggest tax state in the union, so they are concerned with maximizing tax income. Putting AB5 in place will actually allow the state to earn more potential tax revenue.  

How AB5 Will Impact Businesses That Rely on Independent Contractors If someone is classified as an independent contractor, the business has no responsibility to make sure payroll taxes are withheld. If they are classified as employees, this means the business takes on that responsibility which may cause irreparable harm to the business.

The unintended victims of AB5AB5 was created with businesses like Lyft and Uber in mind, but the unintended consequence is that it will affect other small businesses that are actually reliant on independent contractors for their very survival.

1981 was the pivotal point in American history where we shifted from pensions to the 401k as the primary source of retirement funding. Since then we have seen the perils and downsides of a system with a flawed design and execution.  

Before the 401k, we had a plan which gave people a better shot of maintaining a substantial percentage of their pre-retirement income. 4 decades later, what is the result of the 401k and its impact on the livelihoods of Americans? Sadly, not good. 

What was the 401k actually designed for? How is it creating problems for employees and threatening their retirement income? 

In this episode, I talk about the huge problems with the 401k design and how it will impact your financial future. 

3 Things We Learned From This Episode

How the 401k became a vehicle for Wall Street to take advantage ofThe rise of the 401k goes hand-in-hand with the increased power of Wall St. It paved the way for the increased investment in the stock market, and for Wall Street to entice us with lies about what we can do with a 401k, including deferring tax. 

Why the 401k puts you at more risk financially The 401k is a market-based vehicle with no guarantees and the risk of market volatility. All of the risk has been transferred from the employer onto the employee’s shoulders.  

What the 401k was originally designed forThe 401k was originally a plan designed to be professionally managed for highly-compensated executives. It was ultimately adopted because it was a way for companies to avoid the more costly Defined Benefits Plan. 

As we discussed in last week’s episodes, 2020 has produced significant market highs, only to be followed by some of the deepest one-day drops the market has ever seen. 

If we look further into history, we realize that this isn’t just about the coronavirus; this is actually a new pattern of how the market performs. The new normal is insane market highs and vicious lows. 

We need to accept this to be the new reality of investing in the stock market, and take action to fortify our investments and financial security. 

What are the past market conditions that have given strong indications toward our current situation? How can we put the right plan in place in response to the new normal? 

In this episode I talk about what we can expect from the stock market going forward, and how to plan accordingly for it. 

3 Things We Learned From This Episode

What the market looks like in the new normalFrom the low of the great recession to February 2020, we saw the longest period of economic expansion, but then this was followed by the fast and furious coronavirus crash - 24% in 40 days.

Why we need a plan that goes beyond staying in the stock market and riding out the volatilityThe last two corrections each took 5 years to recover from, so if you’re someone who is retiring in 10 years, you cannot afford to have your money in the stock market with all the volatility. 

What you need to know about your brokerYour best interests are not always aligned with your broker’s best interest and what makes them money. In a good market, it’s less about the broker’s ability and more about the good results of the market. 

Ever since coronavirus was declared an epidemic, the world’s been going through a serious rough patch. The financial implications of the entire world shutting down are significant, and if you have money to invest it’s hard to know where to turn.

If you received a stimulus check, you’re going to need somewhere safe and accessible to put it, but is anything actually secure when the world shuts down? We want to give our money a fighting chance, and not focus on outperforming the market, but rather delivering a plan that helps you build long-term financial stability. 

Fortunately, there are places we can put our money right now. There’s been a lot of financial innovation and investing ingenuity that can benefit us. How can we invest without exposing ourselves to the risk of a volatile market? In this episode, I talk about how we can put our stimulus check to use wisely.

3 Things You’ll Learn In This Episode

Why even the most stable asset classes are going to be affected the coronavirus 

With almost every business forced to shut down or work from home, everything is impacted, even the most stable investments are going to perform differently in this environment. 

Real estate is typically the best hedge against a volatile market, but we need to put a pin in it right now

With people being furloughed and losing their jobs, their ability to pay rent and mortgages is going to be impacted. Real estate is typically the safest way to invest but for now, it’s temporarily best to wait. 

A simple innovative tool to help you buy into the index and protect your downside

The goal is to find an investment that allows you to avoid riding the lows of market volatility while getting the benefits of the highs. This is where options-based index investing comes in.

In the last 4 months, we’ve experienced a fast and furious decline in the market. No one could have foreseen a global epidemic, but we did know that we were long overdue for a market correction. 

History can give us greater perspective on how the future is going to take shape. 

On February 19 we hit a historical market high, but within 30 days we saw some of the largest single day losses the market has ever encountered. Even then, many investors refused to heed the signs and chose to keep themselves in this highly volatile market.

This reminds me of the fable of the Dog and His Reflection, a story that’s more true now than ever before. What risks do we take when we chase potential market gains despite the clear warning signs? In this episode, I talk about how to avoid financial FOMO and make wise investing decisions when the market is good.

3 Things You’ll Learn In This Episode

The importance of reading the signs

Before the coronavirus correction, we had seen an unusually long bull market, and that should have been the warning sign that something was going to change around March/April 2020. 

Why the fear of missing out on a market high can lead to our lowest lows

Don’t just think about missing out on the top end of the market. By taking your gains off the table in time, you also won’t have to experience the bottom. 

Why we need to stop and smell the roses

We don’t need to keep chasing the market to the top, we can take the wins we have and get to enjoy them. 

Welcome to Crashes & Taxes! I am super excited to launch my brand new podcast on Thursday, May 14th.  Please enjoy this short preview of my first two episodes. Subscribe to the podcast and join us on launch day as we dive into the latest breaking news and topics. We have an exciting line-up of guests to come, ready to help you tackle the status quo of market crashes, rising taxes and politicians that keep you from growing your wealth. Thank you for joining me and I'll speak to you soon - Rebecca Walser