Suze Orman’s Money Rules: 2 to Keep, 2 to Rethink
Some of the personal finance host's best-known rules on debt, cars, and savings still hold up. Others work better as starting points than as strict commandments.
Quick answer: Two of Suze Orman’s rules still hold up well: get rid of high-interest debt aggressively, and keep a real cash cushion. Two are worth adjusting to your situation: a flat ban on car leasing, and a one-size-fits-all emergency fund target. The core ideas are sound. Some of the specifics may not fit every household.
Suze Orman has given money advice for decades. Her views on debt, car leasing, and saving are some of the most widely repeated in personal finance. A recent Money.com piece revisited several of her guidelines. Below is our own take on which ones are worth adopting outright and which ones deserve a closer look.
Rule to keep: treat high-interest debt as an emergency
Orman has long argued that carrying credit card balances is one of the most expensive habits a household can have. The math supports her. Card interest rates often run well above what most savings or investments reliably earn. So every dollar that goes toward a high-rate balance works like a guaranteed return equal to that rate.
Example math
Suppose you owe $5,000 on a card charging 22% APR and you pay $150 a month:
- About $92 of your first payment goes to interest. Only about $58 reduces the balance.
- Payoff takes roughly 52 months, a little over four years.
- Total interest comes to about $2,800.
Raise the payment to $300 a month and the balance is gone in about 20 months. Interest falls to roughly $1,000. Paying more each month saves real money.
Rule to keep: build a cash cushion before you need it
Orman’s emphasis on emergency savings holds up for a simple reason. Without cash on hand, a surprise expense often ends up on a credit card. That feeds the very debt cycle described above. A dedicated savings account, kept separate from everyday checking, makes the money easier to protect and harder to spend casually.
Rule to rethink: never lease a car
Orman has been a vocal critic of leasing. Her argument is that you make payments without ever owning anything, and that leases make it easy to keep driving a newer car than you can afford. For many people, buying a reliable car and driving it for years is the cheaper path.
A blanket ban skips over some context, though. Leasing can make sense in a few narrow cases:
- Business use. Some self-employed drivers can deduct part of the cost. Check with a tax professional before counting on this.
- Fast-changing technology. Some people lease electric vehicles to avoid owning a car whose resale value is hard to predict.
- Predictable, low mileage. If you reliably stay under the mileage cap and want fixed costs, a lease can fit your budget.
Example scenario
Picture a lease at $400 a month for 36 months. That is $14,400 in payments, plus any fees, with no car at the end. A buyer who pays a similar total over the same period ends up with an asset that still has resale value. That gap is why leasing usually costs more over time. The exceptions above are the cases where other factors can outweigh it.
Rule to rethink: one emergency fund target for everyone
Orman has often recommended a large cushion, sometimes eight months of expenses or more. Many other planners suggest three to six months. The right number depends on how stable your income is and what else you owe.
Say your essential expenses are $4,000 a month:
- 3 months = $12,000
- 6 months = $24,000
- 8 months = $32,000
If you are also carrying 22% card debt, waiting to reach $32,000 before attacking that balance could cost you a lot in interest. Many people take a staged approach instead:
- Save a small starter fund.
- Pay down high-rate debt.
- Grow savings toward a larger target.
People with variable income, a single income, or dependents may lean toward the higher end of the range.
Next steps
- List your debts by interest rate so you can see which ones cost the most.
- Add up your essential monthly expenses to size your emergency fund.
- Before your next car purchase, compare the total cost of leasing and buying over the same period.
- Consider talking with a fee-only planner if your situation is complex.
Bottom line
Orman’s strongest advice is about behavior: avoid expensive debt and keep cash ready. Those rules hold up for almost everyone. Her stricter rules on leasing and savings targets work better as defaults you adjust to your own income, obligations, and goals.
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