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Suze Orman Advises Against ER!
12-07-2012, 10:45 AM
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#1
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Full time employment: Posting here.
Join Date: Mar 2006
Posts: 757
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Suze Orman Advises Against ER!
Okay, I know that she is not the most astute/respected financial guru, but I was surprised about her advice in the January 2013 O Magazine. In an article entitled "All in Good Time," a "decade by decade plan for securing your financial future," she had two tidbits for people in their 50's. The first was that people in their fifties MUST buy long-term care insurance. No mention about people who may have enough assets not needing it or companies going out of business/not honoring the policies.
The second was "Under no circumstances should you assume you can afford to retire early. Stop working at 60 or so and your savings, social security, and pension may have to sustain you for 25 or 30 years."
Now I understand this was a short (two page) article that is addressed to the masses----but to say that no one should retire early? What about people whose pensions are COLA and who get 90% or more of their ending pay? What about people who have saved lots of money?
Don't know what she would say about those of us who have retired early---would she say that we were crazy and did a foolish thing?
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“It is not a sign of good health to be well adjusted to a sick society”.------Krishnamurti
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12-07-2012, 10:55 AM
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#2
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Moderator Emeritus
Join Date: Jan 2007
Location: New Orleans
Posts: 47,468
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I like Suze Orman for personal finance (pay-off-your-credit-cards) types of advice. However, I don't think she has much in depth understanding of the realities of middle class life or retirement. Her idea of living expenses is up there in the stratosphere from my point of view.
She always says people need a lot more money to retire than seems reasonable to me, and I say this from a very cautious viewpoint myself.
She has been saying people should work until they are nearly 70 or longer for quite a while. Sometimes I wonder if she tells people this because of her own insecurities about her own retirement.
I also do not agree with her investing advice. But I think she is terrific in getting people to realize what they can and cannot afford, and on paying down debt.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities. - - H. Melville, 1851.
Happily retired since 2009, at age 61. Best years of my life by far!
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12-07-2012, 10:56 AM
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#3
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Thinks s/he gets paid by the post
Join Date: Oct 2008
Posts: 1,608
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I don't plan to ask Suze if I should have retired. She would probably just say no.
Most of us on this forum have planned our retirements pretty well and also saved and lived well below our means. I think Suze deals with a lot of live for today people who haven't thought about tomorrow much less their future retirement.
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12-07-2012, 11:03 AM
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#4
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Thinks s/he gets paid by the post
Join Date: Jan 2010
Location: 5-sided building
Posts: 1,183
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Orman is a man-hater, especially if the caller is married to one. Her ego has gotten out of control, and she is out of touch with reality. I especially like the pre-paid cards she was pushing about a year or two ago. With enormous fees on them, I don't know how she could look anyone in the eye and say she was trying to help people.
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12-07-2012, 11:13 AM
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#5
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,150
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Quote:
Originally Posted by tangomonster
"Under no circumstances should you assume you can afford to retire early. Stop working at 60 or so and your savings, social security, and pension may have to sustain you for 25 or 30 years."
Now I understand this was a short (two page) article that is addressed to the masses----but to say that no one should retire early? What about people whose pensions are COLA and who get 90% or more of their ending pay? What about people who have saved lots of money?
Don't know what she would say about those of us who have retired early---would she say that we were crazy and did a foolish thing?
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I don't follow Suze at all, but I think her target audience is the masses as you noted. And her quote above doesn't seem to say no one should retire early, it says no one should assume they can afford to retire early. Not assuming is probably sound general advice for the masses.
She goes on to say your savings, social security and pension may have to sustain you for 25 to 30 years, that's consistent with 4% SWR methodology, which is a baseline for many here - for early retirement.
So the article may be sound general advice for the masses, most of whom may not be able to afford to retire early. And it doesn't seem to imply she'd think ERs here are crazy and did a foolish thing, this group is not Suze's target audience of course...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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12-07-2012, 11:14 AM
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#6
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Moderator Emeritus
Join Date: May 2007
Posts: 12,890
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I am not surprised. This has been her message for quite some time.
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12-07-2012, 11:27 AM
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#7
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Full time employment: Posting here.
Join Date: Aug 2012
Location: Upstate
Posts: 699
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Quote:
Originally Posted by Midpack
I don't follow Suze at all, but I think her target audience is the masses as you noted. And her quote above doesn't seem to say no one should retire early, it says no one should assume they can afford to retire early.
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+1. I think we've all heard what folks say about ass-u-me-ing... "Never assume" is some of the best advice ever given/received.
__________________
Yeah well, that's just, ya know, like, your opinion, man. ~ The Dude
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12-07-2012, 11:45 AM
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#8
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Full time employment: Posting here.
Join Date: Sep 2010
Location: Orlando, Fl
Posts: 950
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Are you kidding me?!?! In my opinion Ms. Orman is an out-of-touch ego maniac who specializes in sound bites rather than sound fiscal management.
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12-07-2012, 12:20 PM
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#9
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Recycles dryer sheets
Join Date: Dec 2009
Location: Cleveland
Posts: 344
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What drives me nuts about her "early retirement" view/analysis is she totally ignores the idea that you take a "drawn down" strategy toward your investment portfolio and withdraw say 4% of assets each year. She only looks at whether you can live off of the income and interest generated from your investments, WITHOUT drawing down on principal.
I have seen her tell couples with $2.5 million in investments and very low expenses/lifestyle that they could not afford to retire early "for fear of the unknown"??
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12-07-2012, 12:28 PM
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#10
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Thinks s/he gets paid by the post
Join Date: Mar 2009
Posts: 2,976
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Her advice is not relevant to this forum at all. Her good advice is so basic it adds no value and her bad advice so dangerous it could really mess you up.
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Took SS at 62 and hope I live long enough to regret the decision.
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12-07-2012, 12:28 PM
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#11
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Moderator Emeritus
Join Date: Sep 2007
Posts: 17,773
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Quote:
Originally Posted by Silver
Are you kidding me?!?! In my opinion Ms. Orman is an out-of-touch ego maniac who specializes in sound bites rather than sound fiscal management.
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But she is typically dealing with people who have no clue that their nursing home isn't covered forever under medicare and that their eventual ss plus a current five figure savings account won't be enough to live on very long if they retire in their fifties. At least she is making some people think about it.
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“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
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12-07-2012, 12:31 PM
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#12
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jan 2008
Location: NC
Posts: 21,150
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Again, I don't follow her, but here she seems to recommend a nest egg of 25X annual expenses though she's not clear on tax impact FWIW. Sound like a familiar rule of thumb?
Sure is better than the Fidelity Magic Number of 8X final (work years) pay in another thread today. Fido is a good company, not sure what that article was supposed to accomplish...
__________________
No one agrees with other people's opinions; they merely agree with their own opinions -- expressed by somebody else. Sydney Tremayne
Retired Jun 2011 at age 57
Target AA: 50% equity funds / 45% bonds / 5% cash
Target WR: Approx 1.5% Approx 20% SI (secure income, SS only)
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12-07-2012, 02:26 PM
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#13
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Full time employment: Posting here.
Join Date: Mar 2006
Posts: 757
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Quote:
Originally Posted by foxfirev5
Her advice is not relevant to this forum at all. Her good advice is so basic it adds no value and her bad advice so dangerous it could really mess you up.
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You are probably right! But I guess some people (no one on this forum, of course!) need to hear some of the most basic advice.
__________________
“It is not a sign of good health to be well adjusted to a sick society”.------Krishnamurti
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12-07-2012, 03:51 PM
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#14
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Jul 2003
Location: Kansas City
Posts: 7,968
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12-07-2012, 04:14 PM
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#15
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Full time employment: Posting here.
Join Date: Dec 2010
Posts: 576
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Quote:
Originally Posted by foxfirev5
Her advice is not relevant to this forum at all. Her good advice is so basic it adds no value and her bad advice so dangerous it could really mess you up.
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Agree that her audience is not really the FIRE crowd.
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12-07-2012, 04:48 PM
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#16
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Recycles dryer sheets
Join Date: May 2010
Posts: 497
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best thing about suze is the skits they do on SNL
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You've got to ask yourself one question: Do I feel lucky? Well, do ya, punk?
Retired July '11 investments in very low cost index and mutual funds, balance once a year at best.
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12-07-2012, 04:52 PM
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#17
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Recycles dryer sheets
Join Date: Mar 2011
Posts: 120
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Suze Orman's target audience is no more the majority of people who frequent here any more than the Dave Ramsey followers are (both of whom I thoroughly enjoy listening to every chance I can, since Im not FIREd yet). Both Dave and Suze are targeting people who have no clue how to handle money, who dont even know principle from interest, who for the most part havent even started to plan for retirement. When listening to some of the people she interviews, I want to pull out my hair. Mid 50's, huge debt, little to no retirement, and no clue what to do. If she is simply getting people to look at their money and income in a different way, and learn to save instead of spending and staying in debt, she has accomplished what she has set out to do. Most people here are eons past that. I think she's great.
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12-07-2012, 05:01 PM
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#18
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Recycles dryer sheets
Join Date: Dec 2012
Posts: 113
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I love watching Suze and listening to Dave! It motivates me to not become wrecks like the guests on their shows.
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12-07-2012, 07:07 PM
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#19
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Thinks s/he gets paid by the post
Join Date: Feb 2011
Location: West Tx
Posts: 1,392
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That's the reason I sometimes stop and listen to them.
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12-07-2012, 07:11 PM
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#20
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Give me a museum and I'll fill it. (Picasso) Give me a forum ...
Join Date: Nov 2007
Posts: 5,596
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And I care about this because....?
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I purr therefore I am.
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