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FINANCE FRIDAY LIVE REPLAY 11/4

money management personal finance podcasts Nov 11, 2022

Every Friday at 12 PM EST, Tiffany goes live on Facebook, Instagram, YouTube, and Twitter to review the latest financial news so you can stay in the know!

In this episode, she goes over what the Federal Reserve is and their recent Federal Funds Rate increase, the potential of more increases, and IRS letters that just went out to 9 million people!

Tune in for all these details and more!

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Transcription:

Finance Friday Live 11/4

[00:00:00] Intro/Outro: You know what it is? That's right. It's time to talk money. With your money nerd and financial coach. Now tighten those purse strings and open those ears. It's the Money. Talk with Tiff podcast.

[00:00:13] Tiffany Grant: What help if I had my mic? Hey. Hey everyone. Welcome, welcome, welcome.

Just a moment to get my life together. Make sure everyone is live and direct.

And then Instagram. Where you at? Boo Boot.

All right, we good to go? All right, so hey everyone. Thank you for joining me on this. Lovely Friday. I'm gonna be real. I have been doing way too much this morning already. It's only half the day. I still have not eaten yet, , so I'm definitely about to get on that right after this. But I wanted to make sure I hop on to give you all, Hey, Evie to give you all.

What's going on in the world of finance for this week? And just explain some things so that way we can all stay in touch and aligned with what our finances are doing in the macro environment. So first and foremost, let's get to the most juicy of information so far this week, and that is that the Federal Reserve.

Has increased interest rates yet again this year at 75 basis points, which is just a fancy term, fancy way of saying 0.75%. Okay, So they went up another 0.75%, which has been what they have. Been doing every time they meet for the past, I wanna say three or four times now. And the reason they're doing that is to try to curb inflation.

So apparently they see that inflation is still too high for us and our economy is too hot. And so they're still trying to cool it down. Now I came across, So first let me just explain a little bit about the Federal Reserve system. The Federal Reserve. When I say that, I'm talking about pretty much a network of banks, and over these banks there are like directors, like people that's over it, right?

So there's 12 different. Federal Reserve Banks across the nation. There's Boston, New York, Philadelphia, Cleveland, Richmond, Atlanta, Chicago, St. Louis, Minneapolis, Kansas City, Dallas, and San Francisco. Now, all of these places are also where they print money, right? So if you look at. A dollar if you have a dollar or some type of bill in your hand or can you get your hands on one, you'll see that it'll have Federal Reserve Bank of XYZ wherever it was printed.

So anyway, I say that to say I came across a article where the Boston Fed President, so this is the president of the Boston. Federal Reserve Bank. He said that the next phase of tightening, they're thinking about keeping 75 basis points. So 0.75% on the table. Once again, now on Twitter. Earlier this week after this announcement came out, I was like, Okay.

Point seven five. I figured that would be the case this time, but I was not expecting them to think that that would be feasible for next time. So that's why I wanted to go over this because. Here's the issue. If they continue to keep raising rates, and let's say it gets past the point of a cool down like to the point where the whole economy kind of stops , it could spell disaster.

So that's what the Federal Reserve. Has to balance on a pretty much quarterly or so basis is okay if we raise interest rates, will that cool the economy down too much? And therefore, increased layoffs, affect employment numbers, affect new construction, affect all types of things.

Or do we keep raising it because we think it's too hot and people are still spending too much money? So I was expecting the 0.75% for this time. But to see that the Boston Fed President is talking about 0.75%, again that makes me a little concerned just because I feel like and I mean we, we would just have to see, but I just feel and this is just my personal opinion, so don't take this as law by any means, but I just feel like another increase might send us over the edge.

So we'll see what happens. But that is what's on the table so far. And this article just came out this morning, so that's that. And financial you're cool with the Fed raise. Me too. Cuz I feel like it's needed, but I don't know if they do it again. Another 0.75. I knew that they were gonna raise it again, like after this.

But I wasn't expecting them to keep 0.75% on the table. I thought it was gonna be a raise of a 0.25 or maybe even a 0.5. But not a 0.75. Not that much . So I don't know. We'll see what happens. We have to see what this raise does. They just announced it on Wednesday. If you have savings accounts, particularly with Ally, you got an email saying that your your savings rate has increased.

Cuz I got one of those. And so I'm happy about that. So let's just talk about what all of these raises mean. Okay. when you're looking at Oh, hold on. The financial, you said it will be fine. You think we need another 0.75. That's fair. We'll see what happens. I'm curious to see what happens after this raise.

 It's still fresh. They just made this announcement Wednesday, so play by ear, see what happens. I do feel like things are starting to cool down a little bit especially in the housing market, which is needed. And I was just reading another article, which I didn't have on my sleep to cover today, but it was saying how housing inventory has been going up now that less buyers are out on the market.

So that's good news. So at Lisa's working in that regard, . So anyway, we'll see what happens. Now, granted, and also looking at this chart that I'm looking at right now, if you look at it, we're still low in relation to where we were. Like even in, what year was this? 2007. Our interest rates were at 5.25%.

Right now we're at 4%. So you know, We're still at our, we're still pretty low in the grand scheme of things. 2001, it was at 6.5%. And I wish I could show y'all this 89, it was at 9.81%. So we've been higher but. Yes. Okay. So finance revenue, we made a good point. He said we are at 3.75 to 4%.

Rates haven't been this high since oh eight, which is what I was just talking about. And we did get spoiled. We absolutely did get spoiled. I completely agree with you. And that was one thing that Janet yell when she was head of the reserve, she was saying we're at zero pr, practically 0%.

If things hit the fan, we have nowhere to go. . There's nothing that we can do. And so I get them trying to get that, bump up now at least. So that way. If things get worse or things happen, we have somewhere to go. But for a long time, like I'm looking at this chart from 2008 to 2015, we were at 0.25.

that's literally nowhere to go. , nowhere to go if things hit the fan. So anyway, I didn't wanna get into the weeds on that, but I just wanted to let people know that this is what they're expecting for the next raise as well. , which in the grand scheme of things, looking at this chart, it wouldn't be bad if they did it again.

But at the same time, I just feel like it shouldn't be too fast. Because people are already struggling and stuff and and also, For me, I feel like that's part of what happens when we just get free money , like we just get money just handed to us. It helped in the interim, but at the same time this is the type of stuff that happens.

People spend more and so it's sparks inflation and then here we are. So anyway, that's that. I have articles on my website about how the federal. Reserve works. I have articles about interest rate increases, the fed funds rate and all that stuff. So that explains it a little more in detail. So I'm not gonna do all of that here.

But if you're interested in learning about those macro econ types of things, definitely check out the website and just search for it. There's stuff there. So let's go to the irs. So last time we talked last week, , I let you all know that the IRS will be sending letters out to over 9 million people that could be potentially eligible.

Four stimulus payments, earn income tax credit, child tax credit, and other benefits that have not cleaned it yet. And so they did start sending those letters out. So if you get a letter from the irs, Open it . Don't just throw it to the side. Don't just, put it in the garbage or what have you. Open it and see if that's what it's about.

Nine times I'm gonna say eight times outta 10. That's probably what it's gonna be about because the IRS. Usually when they send you communications, in my experience, it hasn't been bad. Usually it is them just making an announcement or something or another, and so if you get a letter from the irs, it's very important that you open it, especially in this case, because the deadline is November 17th, so they're trying to let people know.

As much as possible Hey, y'all go ahead and fill this out because we could owe you money, and the deadline is coming up soon, and so this is important information for you all to. Definitely make sure that you read. If you get it, make sure you read it in full. I'm sure it tells you how to do your free file or whatever and make sure you get it done, y'all.

Cause this is just money just sitting out there. Speaking of free money, this is the type of stuff I was talking about, , right? And so there's money just sitting out there that they want to make sure that they cover everybody. Free file is staying open until November 17th. And if you're not familiar, free file is when you can file your tax return through the government website irs.gov/free file, and it takes you to one of their providers and usually you have to meet here's the eligibility requirements here.

Free file enables people whose incomes are $73,000 or less to file a return online for free using brand name software. Personally, I have used it before. To file under TurboTax. So TurboTax is one of their partners, but there's a bunch of different companies. If you don't wanna use TurboTax, there's other ones, but you have to go through irs.gov/free file to do that.

So they're leaving free file open until November 17th to help with people claiming these benefits without charge. So That's pretty much it with that important to note. because some people have a misconception that, Oh if I file my text or if I let the government know how much I'm making, then I'll miss out on my benefits. Now, of course, , I'm not gonna get into that, not today, but it says here, help as a helpful reminder, claiming these credits has no effect on the ability of someone to be eligible for federal benefits like ssi.

So supplemental security income. Snaps. So Supplemental Nutrition Assistance Program, aka Food Stamps Temporary Assistance for Needy Family or 10 f and the special supplemental Nutrition program for Women, infants and children, which is called wic. So it does not affect. Any of that, because typically when you go to apply for that stuff, they, you, they want your up to date stuff anyway.

So they're not looking at your tax returns, typically. They're looking at your W two s, your income, profit and loss statements, whatever. So keep that in mind. Don't let that deter you from filing your taxes. Taxes are very important. Oh, and also fun fact, just because we talk about wic. So did y'all know that WIC was started by the Black Panthers?

It was actually a program that they started and then the government started to subsidize and take over, but it was started by the Black Panthers, which I think is just a little known history fact. With that being said, that's all I have for y'all today. I want to keep it short, sweet, to the point.

And if you have any questions and let me just make sure I don't have any outstanding questions here about any of this boo. . But even if you're watching the replay or if you're listening on the podcast, cuz I do put these replays on the podcast, feel free to shoot your questions over. I'll be more than happy to answer 'em either in the comments or I'll even answer them in the next live.

So I don't see any questions here, so I'm a sign off. I think I gave you all enough to think about and talk about and learn about . So thank you so much for joining me for Finance Friday Live. I do this every Friday at 12:00 PM where I just go on some, go over some pertinent news that could affect you and your money for that week.

All right. Bye y'all. .

[00:14:02] Intro/Outro: Thank you for listening, joining and being a part of the Money Talk with T Podcast this week. You can check Tip Out every Thursday for a New Money Talk podcast, but if you just can't wait until next week, you can listen to previous podcast episodes at Money Talk with t.com or follow tiff on all social media platforms.

Add money, Talk with the team. Until next time. Spend wise by spending less than you make a word to the money-wise is always sufficient.

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