I was thrilled to have the opportunity earlier this week to have coffee with Suze Orman at the OWN offices here in Los Angeles. This was the second time I met Suze, the first one being the time I interviewed her at Smashbox Studios two years ago. When you are in Suze’s presence, one thing that you can be sure of is that she is intensely present with you. I love that. The eye contact, the intensity, the fact that she OWNS what she says. My kind of person. The meeting took place in a small conference room at OWN and was comprised of OWN execs and LA bloggers. I got a kick out of the $$$ cake pops and gold coins they had out for us. Good way to set the tone.
Suze Orman’s “America’s Money Class” on The Oprah Winfrey Network (OWN). The class is actually a series of 6 shows each with a topic, guests with money issues related to the topic and audience interactions. The classes are: Money Secrets Revealed, Family & Money, Financial Disasters, Hidden Money, Money Mistakes You Can’t Afford To Make and this Monday is the 6th and final class airing at 9p/8p central time. After the show, a contest begins where one viewer will win $50,000 and five viewers will win $5,000. The contest is in the form of a “final exam” of 12 questions based on what you have learned watching the shows. The contest will be live starting a 12p eastern/9p pacific and will be up for 24 hours. If you have not been watching the series, don’t despair, there are lots of videos of the shows as well as supporting info to be found on the show’s site on OWN.com. Additionally, the entire first episode is available on the site, Money Secrets Revealed. I’m disappointed the shows aren’t available and guess what? Suze is disappointed too! She even said it during the meeting that she thought they should be online and free—this caused the OWN execs in the room to smile uncomfortably. But that is how Suze is. She freely shares her tools to help Americans learn how to take care of themselves financially. Also on the site, Suze is giving away subscriptions and free downloads, make sure to head over there to grab the codes now!
Ok, so, you know about the show and the contest. Before I headed to the meeting, I posted on Facebook and Twitter asking my followers if they had any questions for Suze. I tried to cover as much as I could. Here is what I learned sitting with Suze and what I can share with you: Suze Orman’s overwhelming theme is take care of yourself because no one else is going to. When saving for your children’s college funds, do that after maximizing your retirement contributions, having your debt paid off and an eight month cushion of emergency funds. When you have achieved your goal for saving for something, especially education, don’t “push your luck”, move the money into “safe” positions. Don’t rely on your portfolio’s plan to manage risk for you because a massive hit in the stock market could devastate your investments. When people lose their jobs, they do not make a lifestyle change to match the situation. You must cut everything down to the bare minimum and hunker down because you don’t know how long you will be out of work. Getting exercise is absolutely key to raising your mood and motivation. Set a regular time each day to move around…Starting with walking is absolutely fine. Take care of “needs” before “wants” and put “people before money and things”. She believes we are quite far from a housing recovery and that we have not seen the bottom in some markets. I got a lot of questions about asking Suze what to do if you are underwater in your home, whether they should rent or buy. Since I didn’t get to address specific areas of the country, I can’t answer those questions for everyone. Suze did mention an area where she owns property, Del Rey Beach, Florida and that condos in her community have gone down over $200,000. Have term life insurance and only term life insurance to cover the term during which you will have people dependent on you, ie: 20, 30 year term plans. You will be amazed at how inexpensive the rates are especially if you are under 40.
Another interesting theme that came up was her insistence on the “we” and not the “I”. Such as “we have 2 kids” not, “I have 2 kids”. I thought she might have been a bit intense about this with the people in the room. However, I understand her message. Managing your financial lives, especially when married and with young children, is a team effort. That means sharing the information about what is happening with the money, budgeting and being responsible together for managing your finances. Money secrets and money infidelity is something Suze has covered in this series. Several years of bad money management can be overcome if you tackle it as a team. If everyone is not on board, it will not work. A really powerful tool for people who have no savings is to get them on an automatic savings plan. If it can be deducted from their pay, great. But if they need to send it in themselves, getting into the habit has an amazing way of sticking. The middle class is shrinking. The poor are getting poorer. There are over 50 million Americans in poverty right now.
For investments that Suze recommends right now in the time of non-existent interest rates, Suze listed off some specific choices: Muni bonds (individual not funds), MLPs (Master Limited Partnerships), Real Estate Investment Trusts (REITs), Gold which she is predicting will be at $2100/oz in November, Revenue Bonds and General Obligation Bonds. This is Elizabeth speaking here: I have a background in investments and strongly urge anyone not familiar with the investments listed above to educate themselves thoroughly before putting money that they cannot afford to lose into them.
In closing, personal finance and investing has always been of interest to me. Money is something all of us need and therefore it means different things to different people. We all have our individual experiences that come forward when dealing with money. Suze’s message and one that I would echo to you as well is to take care of yourself and your own finances. There are plenty of people out there who will gladly help you part with your hard earned cash. Your future depends on you taking care of you. Now, go forth and prosper!
My friend, LA’s The Place, shot this video during our meeting. I thank her so much for doing this and graciously allowing me to share.