Suze Orman, the veteran financial advisor, offers practical guidance on which personal finance habits deserve your attention and which deserve rethinking.
Orman's two rules worth following center on debt management and emergency funds. First, she emphasizes eliminating high-interest debt before pursuing investment goals. Credit card balances at 18-25% annual rates drain wealth faster than most investments build it. Paying off that debt delivers a guaranteed "return" equal to the interest rate you stop paying. Second, Orman champions maintaining a fully funded emergency fund covering six to twelve months of expenses. This buffer prevents you from borrowing at punishing rates when unexpected costs arise, whether a job loss or medical emergency.
However, Orman challenges two conventions many households follow. Car leasing ranks high on her revisit list. Monthly lease payments offer no equity buildup. Once the lease ends, you walk away with nothing and restart payments on another vehicle. Buying used cars with reasonable financing costs builds ownership and eliminates perpetual payment cycles. The second outdated rule involves excessive life insurance for young families without dependents. Orman argues that term life insurance serves a specific purpose: protecting those who depend on your income. A single 30-year-old with no children and no spouse doesn't need a $500,000 policy. The premium dollars work harder going toward retirement savings or debt payoff instead.
The common thread through Orman's guidance remains practical math. Rules matter only when they serve your financial reality, not abstract principles. If you carry $8,000 in credit card debt at 22% APR, that $1,760 annual interest cost justifies aggressive payoff over new investment accounts. If you lease three cars over fifteen years, you've spent roughly $50,000 on transportation with zero asset to show. The numbers tell the story.
Orman's framework shifts your focus