For this week’s column, allow me to veer away from the usual question-and-answer format. I would like to share nuggets of financial wisdom I learned from internationally renowned personal finance guru Ms. Suze Orman.
It all started with a call from one of the public relations handlers of BPI. They asked me if I would be interested to attend a special media briefing with Ms. Orman at the BPI headquarters. It took me about half a second to say yes—I won’t pass up this once-in-a-lifetime opportunity.
Who is Suze Orman?
Millions of Americans follow Suze Orman who is probably the equivalent of Oprah Winfrey in the personal finance world. This lady is known for her no-nonsense, direct and practical approach to finance. She is a multi-awarded TV talk show host at CNBC and a certified international bestseller for the many books she has written. To us personal finance advocates, she is an icon.
But who is Suze Orman really and what makes her so successful? Her career did not start as a stock broker or a financial analyst. She was a waitress. In fact, she was a waitress until she was 30.
As a waitress, she saved some money to put up a restaurant of her own, but thought of giving it to Merril Lynch first to grow her investment. In three months, the broker lost her money so she was forced to look for employment. Ironically, she ended up being hired by Merrill Lynch itself and the rest was history.
Love affair with Pinoys
Nearly all of Orman’s household staff are Filipinos and she clearly loves being around them. She understands our culture and she said that we are a very caring and helpful group of people.
Ms. Orman is well aware of the phenomenon of our OFWs sending their entire hard-earned money home and not leaving some for their own future, something she feels is a big problem for us.
It is good to know that Suze Orman also employs about 40 local call center agents to handle business inquiries for her products and services.
Coming to the Philippines is a promise she gave Doris Magsaysay-Ho and made possible by the BPI.
It is interesting to note that Orman did not charge a single dollar for her appearances in the Philippines and she even paid for her own plane ticket.
Preaching about prudence
Suze Orman preaches about prudence in the handling of money. During the media event, she reminded us that whenever our incomes increase, our expenses should not, and that’s the key to having a stress-free financial life. She shared more practical tips on money management like not buying too many shoes and clothes and many other practical advice.
She reminded us that jewelry is actually bad investment and that people buy it only to impress others and not as real investment. For Ms. Orman, houses are not investments; they are bought for us to live in.
However, she likes gold and recommends it to be part of one’s portfolio. She confesses that gold is a substantial part of her own personal portfolio.
Debt is bad
Suze Orman is a firm believer of money over debt.
She harped on not being in debt, and that millions of lives in the United States are destroyed by debt. She said millions of Americans leverage their debt, and many investments are about leveraging, which she categorically states is a bad thing.
She also advised against getting equity from your home and purchase another piece of property as this is a leading reason why Americans are in trouble today.
She further believes that debt can and will make an economy collapse.
All about being practical
She reminded us that we need to be careful whenever we help, saying that “sometimes when you help, you actually hurt people.” She encouraged Filipinos to be self-reliant and not be dependent on remittances.
Former actress and Mommy advocate Maricel Laxa-Pangilinan asked how she could teach her kids to be more prudent in the handling of their money. Orman suggested that, as parents, we should tell our children why we give them money so they would not feel entitled to it. She recommended that we teach our own kids to earn their keep and pay them when they help around the house.
She also encouraged the parents in the crowd that it is okay for kids to make mistakes on money. The younger they make mistakes the better. They will surely learn that way.
An hour with Ms. Orman validated many of the strong beliefs I have with regard to personal finance and yet she impressed me further with the simplicity of her approach. She even gave me some tips regarding my career as a personal finance advocate, truly unselfish of her. So much wisdom from a lady who genuinely cares about the financial wellness of people.
(The author is an advocate of Life & Personal Finance. He is a director of the Registered Financial Planner Institute Phils. and has over 20 years’ experience in the financial services industry. To learn more about essentials of personal financial planning, visit www.rfp.ph or e-mail [email protected])