Have you ever watched The Suze Orman Show? This lady is awesome. First of all, she’s a woman who is very empowered when it comes to personal finance (obviously), which is awesome in and of itself. Secondly, she makes getting angry very entertaining to watch… we’ve got the opposite of non-confrontational here. And third, she refers to people as “girlfriend” or “boyfriend” in an uber-uncool, motherly, yet endearing way. Gotta love her.
Well Suze has a motto that is worth mentioning. It’s pretty simple, maybe even a no-brainer, but sometimes it’s good to lay out the obvious to make sure it’s still obvious.
Her motto is: “People first, then money, then things.”
That’s the order of priority… a firm, unchanging pecking order of what should have our attention and affection. You wouldn’t necessarily expect a personal finance lady on a national cable network to honor the all-surpassing importance of people in our lives. Even if she did believe it, she wouldn’t have to make a big deal about it. But she says it every time, and I appreciate it.
Somehow Tom and I caught a few episodes of her show on CNBC recently. She has this segment at the end called “Can I Afford It?” The idea is that people have honed in on something they just have to have — a luxury car, golf lessons for their kid, a teeth cleaning for their dog, whatever it is — and they have to lay out all their finances so Suze can rule yea or nay on their case.
All their numbers come up on the screen – take-home pay each month, mortgage, credit card debt, retirement account and savings account. She asks them some questions about where they are in life because major life changes will have an impact on their financial scorecard. In the end, she gives them her coveted permission or gleefully yells DENIED! (“Ya fired!”)
But what’s got us about this segment is just the sheer volume of cash that these families have. It’s not unusual for the caller to have hundreds of thousands of dollars in an emergency savings account, and the same if not more (over $1 million) in their retirement account. The take-home pay they cite is often upwards of $6000, $8000, $10,000 or even more PER MONTH for one family… and that’s sometimes just for two people as the sort of people who call in are often empty-nesters.
Now I don’t mean to be freaking out here about normal levels of wealth (although, please note, with 2 billion of our fellow humans living on $2 a day or less, this most certainly is NOT “normal”). I know that this is indeed standard for many American households. It takes a lot of moolah to keep a roof over our heads, heat/AC, and food arriving on the table, meal after meal after meal. Health care costs, car-related costs, utilities, insurance, child care, entertainment, travel, gasoline, gifts… the list goes on forever. Life in America, especially, runs on green.
But the numbers really give me pause each time I see them. Wow, I think. A lot of wealth passes through our hands each and every month.
And the retirement account levels that people call in with are especially flooring. I can’t remember the formula she gave to give a very rough idea of what you should save for retirement, but suffice it to say we should all have millions in the bank before we give our final two weeks notice.
I can’t help but think something is wrong with the way we are approaching retirement these days, and with the way we are approaching our middle-aged and elderly citizens (and family members). Must we face old age so independently, so defiantly, so securely surrounded by bank accounts with lots of zeros in them? Must we depend so little on our family and friends? Must we induce such fear in ourselves because we have not been able to save that magic number of Benjamins?
There’s got to be a better way…