Susan Lynn “Suze” Orman stands as one of America’s most recognizable financial advisors. From 2002 to 2015, she hosted The Suze Orman Show on CNBC and authored 10 New York Times bestselling books focused on personal finance.
This guide showcases 10 key investment strategies that Suze Orman has shared throughout her distinguished career. Let’s explore what Orman recommends for achieving investment success!
Suze Orman’s Investment Background
Orman launched her career at Merrill Lynch in the early 1980s before establishing the Suze Orman Financial Group in 1987. Her prominence grew significantly after publishing financial books, beginning with “You’ve Earned It Don’t Lose It” in 1995. Nine additional finance books followed, each achieving New York Times bestseller status.
Her weekly financial advice show on CNBC ran from 2002 to 2015, during which time she also contributed a personal finance column to Oprah Winfrey’s O, The Oprah Magazine. Currently, Orman hosts the Suze Orman Women & Money podcast.
Suze Orman’s Investment Philosophy
Though much of Orman’s guidance centers on personal finance, she has consistently addressed investing strategies throughout her career. Here are 10 essential investment principles she advocates for successful investors.
1. Focus on ETFs
While Orman observes investors attempting to pick individual stocks in recent years, she cautions against buying individual companies. “Maybe you’ll hit it right,” she notes, but “maybe you’ll hit it wrong.”
Rather than gambling on individual picks, Orman advocates for less risky alternatives: low-cost index funds and sector-wide ETFs.
2. Practice Patience
Orman consistently stresses that investing requires a long-term mindset. “All you really need to do,” she wrote on her blog, “is check your account once a year to see if you need to make any changes to bring your overall allocation back to your target. Other than that, sit tight.”
This patience becomes crucial during market downturns, when undisciplined investors panic and sell. Since the market has historically rebounded, investors who hold through crashes typically receive rewards for their persistence.
3. Minimize Investment Fees
Though Orman supports fund investing, she recognizes that many funds impose excessive fees. She urges investors to scrutinize their portfolios and eliminate funds charging more than 1% annually.
“Paying less in fees means keeping more of your money growing for your future,” she explains. “And that’s extra important for the times when market returns are low, or even negative.”
4. Optimize Your 401(k)
Orman highlights that 401(k)s and similar employer-sponsored retirement plans often carry substantial fees. She advises investors that “while you are limited to the funds offered within your plan’s lineup, it’s in your power to choose the lowest cost options.”
Additionally, she recommends transferring 401(k) and other retirement accounts to low-cost brokers after changing jobs, allowing you to invest with reduced fees.
5. Work with a Quality Financial Advisor
According to Orman, a competent financial advisor is “worth their weight in gold.” Professional guidance enables smarter decision-making rather than guessing about investment strategies.
However, not all financial advisors provide equal value. Orman suggests seeking fiduciary advisors, who must prioritize your interests above their own and disclose conflicts. She also recommends asking potential advisors about their compensation structure.
6. Question the Homeownership Default
Many believe homeownership always represents a smart investment, but Orman argues the financial reality can be more complex. “Sometimes, depending on where you live,” she observes, “it makes sense to simply rent.”
This challenges conventional wisdom, though Orman clarifies she doesn’t oppose homeownership entirely. Rather, she suggests that investing and saving money now could enable you to afford a superior home or reduce mortgage interest costs later.
7. Maintain Monthly Investment Habits
Orman advocates investing “every single month.” This approach eliminates concerns about market timing since your cost basis averages out over time.
One important exception applies: if you’ll need funds within 5 years, consider saving instead of investing to avoid withdrawing money during a market downturn.
8. Embrace Buy-and-Hold Strategies
Orman champions buy-and-hold investing and frequently references Warren Buffett. “A good quality stock is a stock that you should keep, and you should keep, and you should keep,” she emphasizes. “You should not trade.”
She notes that companies generating investor excitement often possess long-term potential. Trading might yield quick profits but could cost you gains of hundreds or thousands of percent over the following decade.
9. Eliminate Debt Before Investing
Like many financial professionals, Orman strongly encourages debt elimination. For numerous young people, this means prioritizing debt payments or emergency fund building over market investments.
When asked about investments for individuals under 30, Orman’s response emphasized that investing isn’t everything: “You’re just rushing to be investing in the stock market,” she told the interviewer, rather than “putting building blocks in place” for solid financial foundations.
10. Maximize Roth Account Benefits
For retirement savers, Orman strongly favors Roth accounts over traditional retirement accounts. “Those are the type of retirement accounts that you want to be in,” she declares. “Stay away from the traditional ones.”
Roth accounts allow you to pay taxes on current income rather than future earnings when you might face higher tax brackets. They also simplify retirement planning by eliminating concerns about changing tax regulations over the next 20 to 30 years.
Key Takeaways: Suze Orman’s Investment Wisdom
Sound investment advice can transform financial outcomes dramatically. Widely regarded as one of America’s leading personal finance authorities, Suze Orman has consistently promoted long-term investing as the pathway to wealth building and goal achievement. Most importantly, she encourages followers to carefully examine their strategies and investments, ensuring their money works as effectively as possible for their future.
