In this episode, Emily interviews Cara Davidson, a graduate student at Western University. Cara has a “tumultuous” income from assistantships, scholarships, and freelance writing, and she built up a considerable nest egg thanks to diligently tracking her spending. She started investing in January 2021 in mutual funds and also meme stocks and crypto. Cara details her investing motivation, philosophy, and sources, shares how much mental bandwidth she devotes to her positions, and gives great advice for anyone already invested in or considering investing in meme stocks and crypto.

Links Mentioned in this Episode

• PF for PhDs S8E18: How Two PhDs Bought Their First Home in a HCOL Area in 2021 (Money Story with Dr. Emily Roberts)
• Kijiji 
• Tax-Free Savings Account (TFSA)
• Registered Retirement Savings Plan (RRSP)
• Wealthsimple
• Celsius
• PF for PhDs: Community
• Binance
• CoinMarketCap
• PF for PhDs: Podcast Hub
• PF for PhDs: Subscribe to Mailing List
• Cara’s Twitter (@CaraADavidson)
• Cara’s LinkedIn

Teaser

00:00 Cara: Do your research. Just because it’s a meme stock, that doesn’t mean that there shouldn’t be some kind of data behind it. Don’t just do it because the internet says to do it.

Introduction

00:15 Emily: Welcome to the Personal Finance for PhDs Podcast: A Higher Education in Personal Finance. I’m your host, Dr. Emily Roberts. This is Season 10, Episode 9, and today my guest is Cara Davidson, a graduate student at Western University. Cara has a “tumultuous” income from assistantships, scholarships, and freelance writing, and she built up a considerable nest egg thanks to diligently tracking her spending. She started investing in January 2021 in mutual funds and also meme stocks and crypto. Cara details her investing motivation, philosophy, and sources, shares how much mental bandwidth she devotes to her positions, and gives great advice for anyone already invested in or considering investing in meme stocks and crypto.

01:06 Emily: I’d like to share with you a personal update now. As I discussed in Season 8 Episode 18, my husband and I purchased our very first home last spring in north San Diego County. It was an area we’d never lived in or near before but we are location independent with respect to work and just got a really good feeling from the city. We’ve been living in our house for about five months now and are settled into a pretty pleasant routine. Our older daughter started kindergarten in August, and our younger daughter is in preschool. After a year and a half of either no childcare or grandparent childcare, it’s amazing to have our children back in a school setting. It’s great for them to be among peers, and it’s great for us to have quiet, uninterrupted work time. We also enrolled the kids in introductory sports classes, which is quite hilarious to watch.

01:58 Emily: We’ve made friends with a few of our neighbors, and I’ve organized a once-per-month social gathering in our neighborhood park. We have a goal to explore one new-to-us point of interest each weekend, so we’ve been to numerous beaches, parks, tourist attractions, etc. It definitely isn’t considered hip, but my husband and I both really wanted this quiet, suburban, family-oriented lifestyle, and I think we’ve made a good start at cultivating it after so many years of putting down only shallow roots. COVID has of course made its mark on this process and has dampened the in-personal socializing that I would otherwise have hoped for. I am really thankful to live in an area where it’s pleasant to be outdoors year-round. That was one of the main reasons we moved away from Seattle in summer 2020. We are here for the long-term, though, so I hope with time and vaccine availability for the younger children, we will eventually develop a robust network of local friends. So I just wanted to let you all know that things are going well following our move, and even though buying a house in a place we’ve never lived before was an odd thing to do, it seems to be working out. Without further ado, here’s my interview with Cara Davidson.

Will You Please Introduce Yourself Further?

03:12 Emily: I’m really excited to have joining me on the podcast today, Cara Davidson. She is just finishing up her master’s now, starting a PhD program in the fall. We are recording this by the way in June, 2021. Cara has been on an investing journey, specifically regarding meme stocks and crypto and other kinds of investing. And I’m so excited to have her because I haven’t had a conversation about this yet. Obviously it’s been in the news and on a lot of people’s minds, and I know there are so many people in my audience who are interested in this kind of investing because it’s garnered so much attention and it’s so exciting. And I’ve been getting questions in my seminars actually about how do I pay capital gains tax on this money that I made from, you know, this kind of investing? So super excited to have Cara on. Cara, would you please tell the audience a little bit more about yourself?

03:58 Cara: Yeah, absolutely. So, as you mentioned, I’m finishing up my master’s and then launching my PhD in the fall. I’m specializing in mixed methods research involving intimate partner violence and looking at how that can affect breast cancer. So I’m really excited for that, but I’ve yet to defend. So that’s kind of the bane of my existence right now. And yeah, in terms of investing, I got into that in January. It’s brand new to me still, I guess that was like the height of the meme stocks. And I got in just in time and I’ve been riding the wave ever since. It’s been a lot of fun for me. And then I’ve also been dabbling in cryptos, which I also find really interesting, especially just because of the volatility of the market, which I know is a huge disincentive for many people. But for me, it’s a lot of fun because you can make a lot of money really quick, but I guess you can also lose it all pretty fast too. So I’m looking forward to discussing all of that.

04:55 Emily: Yeah. We’ll get into that in a moment. And can you tell us what university you attend?

05:01 Cara: Yes. So I attend Western University in London, Ontario but I’m doing so remotely right now. So I’m at home in Ottawa at the moment.

Balance Sheet: Cashflow and Side Hustle Income

05:08 Emily: Okay, great. So first question is, let us know what your balance sheet looks like right now. And actually it’d be helpful to talk about cashflow too. Like what’s your stipend? What basically are, you know, you spending on living expenses, and how much are you able to save, and how much have you accumulated in what?

05:25 Cara: So, I’m a freelance writer, so I’m going to say that first because when I was doing my research on my own finances for this interview, I was a bit surprised at how much it really does fluctuate. So like I’ve made as little as $1,700 in a month and I’ve made as much as over $8,000 in a month. So, I really like month-to-month don’t know what’s going to come my way. It can be really lucrative and it can be tight. And in a year also, like, I wouldn’t say I even have an annual salary because I’m so dependent on grad funding, like scholarships that I’m applying to, GRA positions if I’m fortunate enough to get one, teaching assistantships. So even putting like a dollar amount on my annual income is difficult just because like, I really don’t know what I’m going to earn until it happens.

06:18 Emily: Okay. So you have the freelance writing side hustle, but I assume it brings in more than your main hustle, right? Being a graduate student, but it sounds like even that aspect of it is not, it’s not fixed or steady, right? Your income as a graduate student is fluctuating.

06:33 Cara: No, not at all. So like, as I mentioned before, like that about like one and a half to $8,000 range, that can come in freelance, I’ve made like 200 bucks in a month and I’ve also made $3,000 in a month and that’s just doing it like part-time, as I can, as a grad student. I was fortunate enough to get the Ontario Graduate Scholarship for last year, or I guess technically this year, which was $15,000. And then the Canada Graduate Scholarship for next year which is 17 and a half thousand dollars. But those kind of aren’t ideal because they go to tuition first. So like, you’re like, yay, $15K. And then immediately like $8,000 gets taken from you. So that’s not ideal. And then depending on whether or not I get the research assistantships and I get the TA ships, I’m making, the research assistantship’s like one to $2,000 a month. And then the teaching assistantship is about $5,000 a month, but I mean, it’s so variable. And then I got another scholarship for $1500. I don’t know if that’s coming again in the PhD, like they don’t tell you until it happens. And then one other source of income that I’ve recently gotten into is flipping things on Kijiji. So like buying like old wood furniture and sprucing it up. I really enjoy that. But then again, like that’s $0 some months and like $500 next, so.

07:53 Emily: Wow.

07:54 Cara: My finances are tumultuous, to say the least.

07:58 Emily: Yeah. That’s definitely, that’s a great word to describe it. Is at least the freelance writing, like anti-correlated with your graduate student income? Like, are you able to, if you know, you have slow months coming up for like scholarship-wise you can ramp it up, or is it also just not really under your control? Just like whatever work comes your way.

08:17 Cara: So right now I’m fortunate that I have clients that just show up in my inbox and they’re like, “Hey, I need something from you.” Just because I’ve been working with them for a long time. So that part, I don’t have much control over, but if I do have a slow month, I can go to my platforms and like apply to things and likely get jobs. So I have a lot of peace of mind from that, that like, no matter what happens, like let’s say I don’t get a scholarship next year or whatnot. Like I can still rely on that and I will be able to support myself.

Balance Sheet: Savings and Investments

08:48 Emily: Yeah. I feel like this could be a whole podcast interview in itself just on the freelance writing, which is really exciting. But also on dealing with the irregular income aspect of it. However, this is not the subject that we propose to talk about today. So I am curious though, I asked about your balance sheet. So like are you in debt for example, or how much of your assets are devoted to maybe cash savings to help you buffer these irregular months? And how much do you actually have working for you in terms of investments?

09:17 Cara: Yeah, so right now in my bank I have about $7,000 and I like to keep it normally around like three to 4,000. So I’m looking for something to do with that extra cash, just because I had a busy freelance month. In terms of debt, I am very lucky that I don’t have any. So in my undergrad, I was so lucky that my parents would pay my rent and all I had to do is worry about like tuition, books, and food. So that kept me out of debt for sure. And now getting the scholarships, like I’m able to pay off the tuition right away, because that would be my biggest expense. So, and then my partner and I just paid off his car that I now use. So I helped with like the remaining payments. That’s gone.

09:58 Cara: So I really don’t have any debt. In terms of credit cards, like I use one as a debit card. I heard that’s good for your credit score. So I do that. But I pay that off like every two weeks so that I don’t really consider that a debt. And then in terms of investments, I’m pretty busy in that front. So I have a TFSA that I’m able to use. I forget their official title, they’re a professional investment manager. And I maxed out my TFSA, which was good, which is about, I gave them like $34,000 at the beginning of the year and now it’s become $36,000. So that was exciting for me, that was like my first foray into investing and it worked out. But that’s a long-term hold. Like I’m not going to touch that money like in my mind ever. It’s just going to be there forever until I really need it.

10:46 Cara: I opened an RRSP which was fun. I’m doing that through Wealthsimple. That’s where I do my like traditional investing. And I’ve managed to make a couple hundred dollars on that as well. It’s sitting at about like $5,000, I think. And then I also have a personal account. So before I opened the RRSP, I was dabbling in Wealthsimple. And that’s just like, like I will get taxed on it, which is the sad part for me, but that’s okay. And that’s where I’m holding my meme stocks, which was not smart on my part. So like, let’s say those do really take off, then I’ll be paying the price for that, but that’s okay. I believe in taxes. It’s fine. And then I have a couple of different crypto wallets where I hold things.

11:31 Cara: So I’ve got like $4,000 in cryptos, I’d say. And so I really liked Celsius. So Celsius is a wallet where you can hold your cryptos, but you also earn interest on those cryptos. So like I’m buying tokens that I would hold anyways, but I’m earning like up to 14% interest on those year over year. So that’s been fun for me as well. And then just holding in various wallets, like my long-term things that like, I’m hoping in five years we’ll be up enough that I can cash out and make a profit.

12:02 Emily: Yeah. So, it definitely sounds like you’re not all in on any one thing, right? You have a variety of different strategies and places going on for our American listeners. I think the RRSP and TFSA equivalents would be like our IRAs or other tax-advantaged types of, you know, supposed to be for retirement type accounts. Versus just holding things in like a taxable brokerage account, which you also have. Yes. Wonderful. So yeah, you, you only started in January, but it sounds like you had a fast start because you had savings to devote to it already, right?

12:34 Cara: Yes. Absolutely. So like I worked through high school and I didn’t spend a dime and that’s why I was able to have that cushion. And it was just sitting in my cash account and I kept thinking like, I should do something, even if it’s only 5% interest like that matters for inflation and whatnot. So I was able to have a nice little nest egg to devote.

Strategies and Mindset for Building Savings

12:51 Emily: Yeah. So let’s talk for a moment. Were there any other strategies that you use to build up the savings that you were then able to invest and also your current level of savings? So you’ve already mentioned the freelance writing career, of course, finding funding as a graduate student. Anything else that you practice or related to your mindset that helped you build up the savings?

13:09 Cara: Absolutely. I track everything. I’ve been tracking everything since I was in high school. I have like my own Excel sheet where I put in all of my expenses every month. Like absolutely everything. And that’s helped keep me accountable a lot. So like I was exploring those food kits that will get delivered to your door, but they end up being so expensive. So I was looking at my grocery bill, and as soon as it hit over like $300 a month, I was like, nah, I can’t do that. Like I’d much rather put the money towards something else. So I’ve definitely dialed back on that. But if I wasn’t tracking like that, I wouldn’t see these things that crop up. And like, I find you forget in a month what you’ve actually spent things on. So like, I have a puppy and I would love to spend all my money on her. And like, I’ve noticed that, okay, you’ve already spent this much on her. Like maybe you can pass on that special thing for her this month and then get it the next month just to keep a more consistent level of expenses. So I’d say that’s been the biggest thing for me was keeping myself very much accountable in terms of what I am spending and relative to the income coming in that month.

14:18 Emily: Yeah. It sounds like, I mean, that tracking is not at all passive for you. You’re really looking at the data and then making different decisions based on what you’re seeing. So I absolutely love to hear that.

Progression to Crypto/Meme Stocks

14:29 Emily: Okay. So I think you mentioned earlier that you just started with investing in this past January, so like five months ago. And you started with a bang because you had the cash savings to put towards some different things. Of the different investments that you mentioned, was the more like classic type of investing the first thing that you did, or did you start out on these like crypto/meme stocks more? How did that progress?

14:54 Cara: So I started for sure with the TFSA. I had already put a little bit of money in there, like maybe under $10K, but I didn’t really know how to use it. That’s not very clear. So I wanted to max it out. I may as well while I can. And so that’s when I connected with the investment advisor and they were able to actually invest in different stock portfolios for me. And then I was just watching the number for like a few months and I was like, “Meh, like this isn’t doing what I would like. Like I’m young, I can take on some risks.” And I feel really comfortable with the amount that I have in that right now. So why not? Let’s do something more fun in the future and where there’s more risk, but the reward is higher and I can be more engaged with it. Because with the TFSA like, you don’t really touch it unless you need to move around your portfolio, which my advisor would do, and I wouldn’t. So I wanted something more hands-on because I do find it fun. So that’s where I got into the meme stocks and the cryptos

Getting into Meme Stocks

15:56 Emily: Let’s start with meme stocks because that’s been like the newer story. Crypto has been an exciting ride for a number of years now. So with meme stocks, you said you started in January. And when you volunteered to be on the podcast, that was in March, we’re now getting around to actually recording this interview in June. So I know there’s been some developments over that time as well. So, yeah, just tell me like what your experience was through those through these last few months.

16:19 Cara: It has been a wild ride. So I started in January. I got in on the floor of GME at like 40 bucks based on something I read on Reddit. I’ve been a part of that community ever since, but moving around there were problems in the WallStreetBets community, which I guess that happens when there’s money involved. So I’m in another one that’s like a little more secure and they call them like shills. So less people trying to sway your opinion and more of like, here’s the data look at the data, which is fun.

16:52 Emily: Is that also on Reddit?

16:53 Cara: Yeah. So a lot of how I’m involved in the meme stocks. So, I’m in on GME and AMC. Since January I’ve been holding, like they went like way up. I don’t know if you heard around like it was around my birthday and like the end of January, they just went way up and then Robinhood blocked buying. And that was like a massive thing. I was so upset because that just basically like, like cut off the feet of the short squeeze, and I’ve been holding ever since because I’m like, just because they turned off buying doesn’t mean that the short interest is any less. That doesn’t mean that they don’t have to cover. So I’ve been holding since, and then actually this week there has been like crazy developments once again. So AMC really shot up yesterday, like 99%.

17:40 Cara: They’re struggling today, but I have confidence. There’s big meetings coming up. But that actually reminds me, so like we call them meme stocks, and that’s what everybody knows them as, but AMC and GME, the reason why they’re actually successful is because there’s a lot of data behind what we’re doing. And I probably shouldn’t say we, because that sounds like a lawsuit waiting to happen, but based on the data that’s available in the short interest in knowing that anyone who shorted the stock does need to cover, but if we’re all buying and holding these stocks and so many people, so many retail investors do, there’s nothing to buy up. And so when you have that much demand and that little availability that creates a short squeeze and then boom, off we go to the moon. And then I cash out. But I’ve been waiting five, six months for that and it looks like it’s on the horizon again. So we’ll see. We’ll see, stay tuned.

18:35 Emily: Yeah. Well, I would like to hear about the future. So like for you personally, do you have a plan for when you’re going to exit this position or partially exit it?

18:44 Cara: Certainly. I don’t have a dollar amount, but I do want to see indicators. Like yes, we are indeed in the short squeeze. Like, a short squeeze does not happen in a day, and it doesn’t shoot up a stock by a hundred percent. Like, it’s pretty exponential in terms of how that works. In considering who’s involved in shorting the stock, and like basically when you short a stock, like you’re betting that the company is going to go under, go bankrupt, et cetera. I’m not a huge fan of Wall Street and how they’re playing this. Like, there are a lot of shady things going on. So like, even if it goes to like a thousand dollars a share, I’m not selling. Like that’s not worth it for me. I would really like to stick it to the people who are manipulating the economy and running these like innocent businesses under. So in that regard, I need to see that the short squeeze is happening. I need to see that Wall Street is scrambling to cover everything. And then I’ll probably hold on a little longer and then sell on the way down. Because I don’t want to miss the peak.

Commercial

19:52 Emily: Emily here for a brief interlude. If you are a fan of this podcast, I invite you to check out the Personal Finance for PhDs Community at PFforPhDs.community. The community is for PhDs and people pursuing PhDs who want to take charge of their personal finances by opening and funding an IRA, starting to budget, aggressively paying off debt, financially navigating a life or career transition, maximizing the income from a side hustle, preparing an accurate tax return, and much more. Inside the community, you’ll have access to a library of financial education products, including my recent set of Wealthy PhD Workshops. There is also a discussion forum, monthly live calls with me, and progress journaling for financial goals. Our next live discussion and Q&A call is on Wednesday, October 20th, 2021. Basically, the community exists to help you reach your financial goals, whatever they are. Go to pfforphds.community to find out more. I can’t wait to help propel you to financial success! Now back to the interview.

Initial Amount of Money Invested in Meme Stocks

21:04 Emily: So when we started talking about your portfolio overall, you mentioned, you know, certain dollar amounts, 30 some thousand that you put towards this and that or the other. You can share whatever you want of this, but I’m wondering how much money you initially invested in these two stocks? Because I want to get an idea of like how big this was. It’s probably big in your world now, but how big was it at the beginning?

21:28 Cara: I’ve been like gung-ho since the beginning, but I also did not trust like the information I was getting totally. Because like I found this on Reddit. Like let’s not go too far here. So let’s see. I think I wrote down what I put in. Did I, did I not? Okay. I think I put $750 in AMC and I’ve got like a $2,500 return now. It’s still not worth it for me. The squeeze hasn’t happened. And then I think GME, I did maybe about 1400, $1,500. So, like that is a lot of money, but for me, like relative to like the TFSA I have to fall back on, like it’s not a big deal for me. If I lose that, I can recoup it based on my freelance. And like the risk for me isn’t, I don’t find it that high. I do believe that like these companies will go up, so I’m not worried about that. And I got in while the floor was still low. Like if you’re buying in now and it’s like 250 bucks and you want to buy a lot of shares, it’s going to be a lot more money for you. So I would hesitate then, maybe. But yeah, I’d certainly put about like 2,500 in total, under $3,000. And just to see like where it took me.

22:46 Emily: I feel like that amount of money is a lot of money, like in a grad student world. We’re talking about, you know, one month stipend, maybe a little bit more, a bit less. That’s a lot of money. But for you, because you had these other sources of income, you had, you know, the good savings going on. As part of your overall portfolio, it wasn’t a big percentage. And that’s something that I, so I’m kind of a dyed in the wool, like passive investor. And so, the advice that I hear from other people who promote passive investing is like, okay, sure. Like if you want to, you know, get into these like exciting trends and be part of it. And like you were saying, maybe you want to make a statement with your money about the policies of Wall Street and so forth, do it, but do it with an amount of money that you can afford to lose that’s not going to hurt you, right? It’s not going to make you lose sleep at night or anything like that. So it sounds like that’s actually what you did. And so it’s been an exciting part of your portfolio, but it’s not anywhere near the majority of your portfolio.

23:43 Cara: No, no. And that would give me stress. To lose it all would hurt my pride and that’s fine, but like, I wouldn’t be putting myself in any danger whatsoever. Like I would be perfectly able to like continue living my life and to recoup that. And like, I would never bet my life savings. I know some people do. It’s all or nothing, but I’m too risk adverse for that. Like, I do have a tolerance, so yeah. I wouldn’t recommend that. This has worked out for me just fine so far. And I’m very comfortable with what I’ve invested and where I’m at.

Time and Energy Spent on Meme Stocks

24:19 Emily: So I think what you said was that you took this initial position in January, and you’ve been holding it since then. So I am wondering about the amount of like attention you’re giving to this, given that you haven’t actually changed anything about your position. At some point you will sell, we think but yeah, like how big is this in terms of your time and your energy?

24:41 Cara: I absolutely adore it. Like I’m checking on it every day. I will take a break if it’s like been a slow week or whatever. I’m like, man nothing’s changed. But like this past week now that things have been going up again and looking promising, like there’s a big shareholders meeting coming up, we’re going to hear Q1 earnings, all of that stuff. I’m like, oh, okay. Let me just keep up with this again. So I will say that I do spend a lot of time. I like reading the DD, the due diligence, on all the forums and just keeping up with what everyone else is talking about. And I’m not sure that I would be devoting the same attention or would be this invested if we weren’t in a pandemic where this is like one of my only hobbies that I can still access. So it’s been nice to belong to a community virtually and you kind of explore this together. So I would say I do devote a good chunk of time to it, but like I see it as just like a fun hobby that I’m doing. I don’t see it as an obligation because, “Oh my God, I’m a shareholder now. And I’m worried about my portfolio,” and all that. That’s not the case.

25:50 Emily: Yeah. It sounds like you’re going about this in a really healthy manner. So I’m really happy to hear that. Anything else you want to add about meme stocks before we talk about crypto?

26:02 Cara: I will say if you’re thinking about going into meme stocks, just be careful now on the forums. Now that we’ve had our moment of glory, there’s a lot of people out there with I would say like nefarious intentions. Like as soon as we had that day where GME hit $450 at the end of January, all of a sudden all of the ads, all of the new accounts that were made and they were all shilling silver, and everyone’s like, who’s investing in silver? Like there’s no, no one’s shorting silver. What’s going on? And a lot of people lost a lot of money on that because it was basically a pump and dump to distract attention from what was happening with GME. And that’s still happening now, especially right now as we’re chatting because we’ve had such a wild week. So do your research. Just because it’s a meme stock, that doesn’t mean that there shouldn’t be some kind of data behind it. Like for example, AMC and GME are based on potential for short squeeze and that’s a proven concept. It happened with Volkswagen way back. So still do your research. Don’t just do it because the internet says to do it.

27:10 Emily: Yeah, that’s great. Well, I think you’re speaking to a receptive audience in that respect of PhDs and PhDs to be.

Experience with Cryptos

27:16 Emily: Okay. Let’s turn the attention to crypto, then. You also started investing at that time. Tell us about your position and what your experience has been.

27:23 Cara: Yeah. So in cryptos, it’s also kind of like the meme stocks where I’m not putting a ton of money in it. I’ve got maybe like $4,000 in there. And I like to just like keep sifting through things and changing out my positions and whatnot. My long-term holds are Nano and anything that I have in Celsius, so that would be MATIC, Ripple, and the Celsius token. And that’s just because I believe that they will continue to go up over time. And I don’t feel the need to like work around the increases and decreases that happen and the fluctuations on like a daily, weekly basis. I’m not in Bitcoin or Ethereum. I’m not a fan of the gas fees. I think that’s ridiculous. That’s why I’m such a big fan of Nano because it’s instant, it’s feeless, it’s green. And so that’s why I think like that will certainly be a strong contender in the future of crypto.

28:19 Cara: I am invested into, I guess, meme cryptos. When I heard that Elon Musk was going on SNL, I got into Dogecoin because I’m like, definitely the exposure is going to drive it up. So I got in like maybe 27 cents or something, and I got to exit about 50 or 60 cents. So that was like a tidy little return and I cleansed my hands and that was good. And then I bought in again, actually once it went back down after just because I don’t know what’s going on with Elon Musk, but like he loves it and he won’t stop talking about it and he wants to integrate it into everything. So I’m like, okay, if you’re going to have anyone behind a crypto that’s going to be actually used daily and whatnot and at least grow as an investment, then I might as well just hold like a couple hundred Dogecoin and see what happens.

29:13 Cara: And then I also invested in, I guess, a Dogecoin copy cat called Shiba Inu. It’s like, you know, like the sheep dog meme. Yeah. So it’s that. Definitely my most irresponsible investment, but it’s like fractions and fractions and fractions of a cent. So I’m like, I just put like a hundred dollars and this thing goes to 1 cent. Like that’s a good return. And I’m happy to just, like, I would spend a hundred dollars on like, I don’t know, maybe like a nice weekend with friends doing something. So I’m like, I might as well just tuck that away. I have nothing else to do right now. We’re locked down. And let’s just check on it in like 10 years and let’s see what happens. I’m happy to wait. So that’s where I’m at.

29:56 Emily: I really like to hear these distinctions that you’re making between what you’re holding long-term, what you are buying because of instincts about where a particular different coin is heading, and then also that last point that you just made about, you’re really explicitly calling that entertainment at that point. Like I could spend 100 dollars on going out. Well, okay. That’s not available to me right now. Okay. A hundred dollars in this position. We’ll just like, it’s money spent. It’s gone. It’s not even like, you’re barely even thinking about it as an investment anymore at that point. Just like you sunk some money to something you’re having a good experience with it. And it doesn’t really matter what the outcome is, right? So I like to hear those distinctions. How are you, like, what are your sources when you’re doing research on these different cryptos?

30:43 Cara: I just think about what I would like as a consumer and someone who would like to use crypto in the future just to make transactions and make everything easier. So that’s, again, why Nano appealed to me. I wanted something that’s instant, like waiting 30 minutes for Bitcoin is ridiculous. And to think that you can pay like really ridiculous amounts of fees as well. Like sometimes I buy things on Binance, like coins and then I go to transfer them out to hold them in a secure wallet and it’s like paying 40 to $80 in fees. And I just don’t think that’s right. I don’t think that makes any sense at all. And then also seeing photos of these massive mining rigs that they have all over the world that are just chugging away, killing the planet. I’m like, as a currency of the future, that doesn’t make sense either. So I do believe the ones that have the most potential for adoption are ones that are green, that are as fast as a normal transaction, and that don’t carry those massive fees. Like nobody wants to pay more money just to use money. That doesn’t make any sense to me. So my long-term holds are ones that support that for the most part.

Resources to Learn About Cryptos

31:55 Emily: Yeah. I understand. I like your thought process on that. I’m actually wondering more, like, how do you find out about Nano, for example, like how did you think about yourself as a consumer and then match that with, oh, this point reflects what I would like?

32:09 Cara: Great. Like a couple of my friends are into it, so sometimes they’ll introduce coins to me and I’ll chat about that with them. I’m involved in a lot of crypto Reddit forums where I read up on new stuff coming out or updates and whatnot. I also, I just go on CoinMarketCap and I see like, who are the gainers? Who are the losers? Why’s that happening? Because they have like a really handy, like, you’ll see like the price action and all that. But if you scroll down, they’ll give you like a two-paragraph succinct explanation of what this coin is and what it’s hoping to achieve. And then normally like there’s blog posts about that coin that I’ll look at if I’m interested that list the pros and cons. And as soon as I see something like gas fees, I’m like, Hmm, Nope. Or long transaction times. Nope. I’m out. So that’s how I would say I find my responsible investments. My irresponsible investments are things that you hear other people talking about, like Dogecoin, where it’s just like a public movement where everyone’s like Dogecoin. That’s so funny. Let me buy some and then you go up and then you can sell. So I would hear about those ones from other people in like online, I guess, conversations. So it depends, I would say.

How Much Attention Are You Giving to Your Cryptos?

33:24 Emily: Yeah. So a similar question to when we were talking about the meme stocks, but like, how much attention are you giving to your crypto positions?

33:32 Cara: I check on Nano every day, because that’s my baby and I love Nano. So I will check on that constantly. I get really excited when there is price action and I obviously have the opposite reaction when it goes down. So I check on Nano every day. As for my other ones, like, I’ll take a look at them. I just like take a gander, like my Celsius wallet I’ll check on to make sure that I got my weekly interest as promised. And then I leave that alone. In terms of Dogecoin and Shiba. Like, I don’t want to hear about those for 10 years and then I will cash out. So, I would say really Nano is the only one that like I’m investing considerable time in. Like I’m in all the forums. I’m keeping up. Like we just had a new version update come out. Because there was like a massive spam attack that was clogging up the network. And obviously that needs to be solved to facilitate like massive adoption. So developers were great and they fixed it. And so like, I wanted to know everything that was going on with that, but I do not get that in depth with like any other crypto because I found my one and I’m sticking to it.

34:38 Emily: Okay. Got it. Yeah. We’ve gotten some, you know, great insights and great advice from this conversation so far. Is there anything else that you want to add about what you’ve learned about investing in meme stocks and or crypto? I’d love to especially hear a little bit more about the psychology of it. If you have any advice for someone who’s thinking about getting into this or who’s already in, but is wondering, what do I do now? I’m already in, now what?

To Do Cryptos, Or Not To Do Cryptos

35:01 Cara: If you’re a really impulsive person, I don’t think that you should do cryptos because you can go to bed at night and you’ll be up like 20% that day. And you’ll wake up in the morning and you’re down 25%. And there’s usually no clear reason as to why that happened. So if you’re the kind of person who’s going to panic and say, oh my God, I just lost a quarter of my investment. My life is over blah, blah, blah. Don’t do it to yourself. Like you will be so stressed. But if you’re a person who is more like me and like you’re happy to buy something and then leave it alone, like indefinitely until you want to use that money or just to see where you’re at out of interest, not out of like obligation and stress, then absolutely go for it.

35:42 Cara: That sounds fine for you. But I would worry if you’re an impulsive person that you’re going to buy high and sell low just constantly and just absolutely wreck your finances. And cause yourself a lot of stress that you don’t need. Like this is supposed to be fun. People aren’t taking most cryptos very seriously. You get kind of a mix with meme stocks, but even still, like I bought in at GME at $40, I held up to $450, and we went all the way back down to like 50, 60 bucks. And it’s been five months where I’ve been sitting here checking it every day to be like, what’s going on? What’s causing this price action? And if that doesn’t sound like fun to you, and I know it doesn’t to some people, just don’t do it. Like you don’t have to do it just because everyone else is, it doesn’t make any sense for you and you won’t enjoy it. And that’s the whole point I would say.

Best Financial Advice for Another Early-Career PhD

36:33 Emily: Great advice. Thank you. And I think I would add onto that, the reason YOU can have that attitude about this is because it’s not a significant part of your portfolio. You’re not drawing any income from this. You have other sources of income that are coming in. Your whole life is not riding on, you know, the performance of these particular investments, right? You have this in balance with a lot of other things. So like, you CAN sleep well at night because you’re not depending on this. So a very, very important point to add on there. Well Cara, thank you so much for this interview. I really enjoyed speaking with you and learning about your experience with meme stocks and crypto. As we sign off, I just want to ask you the same question I ask of all my guests, which is what is your best financial advice for another early-career PhD?

37:15 Cara: Advice in terms of meme stocks and crypto?

37:18 Emily: It could be related to that, or it could be completely something else.

37:22 Cara: I would say, just buy pretty much anything and just hold it. Just hold it and like, forget the password and have a reminder on your phone in five years with that password. Like do not touch your investments unless you know how to day trade. And I don’t think anyone really knows how to day trade consistently. Like it’s very, very hard to achieve. And it’s more dependent on the market than you and most times. So if you buy and you hold, you will be okay. But obviously to do that, make sure that you’re putting in money that you don’t need for five years and you won’t feel tempted to touch it all. So whether that’s like 20 bucks or a couple thousand, whatever that means for you do it and just forget about it. And then it’ll be there and ready for you hopefully in several multiples for you in a few years.

38:11 Emily: Sounds wonderful. Thank you so much, Cara. This was a great conversation. Thank you so much for volunteering.

38:16 Cara: No, thanks for having me. I had a lot of fun. It’s nice to discuss these things outside of my Reddit communities. I really appreciate it.

Outtro

38:30 Emily: Listeners, thank you for joining me for this episode! PFforPhDs.com/podcast/ is the hub for the Personal Finance for PhDs podcast. On that page are links to all the episodes’ show notes, which include full transcripts and videos of the interviews. There is also a form to volunteer to be interviewed on the podcast. I’d love for you to check it out and get more involved! If you’ve been enjoying the podcast, here are 4 ways you can help it grow: 1. Subscribe to the podcast and rate and review it on Apple Podcasts, Stitcher, or whatever platform you use. 2. Share an episode you found particularly valuable on social media, with a email list-serv, or as a link from your website. 3. Recommend me as a speaker to your university or association. My seminars cover the personal finance topics PhDs are most interested in, like investing, debt repayment, and effective budgeting. I also license pre-recorded workshops on taxes. 4. Subscribe to my mailing list at PFforPhDs.com/subscribe. Through that list, you’ll keep up with all the new content and special opportunities for Personal Finance for PhDs. See you in the next episode, and remember: You don’t have to have a PhD to succeed with personal finance… but it helps! The music is “Stages of Awakening” by Podington Bear from the Free Music Archive and is shared under CC by NC. Podcast editing by Lourdes Bobbio and show notes creation by Meryem Ok.