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Author Biography: Suze Orman is the author of the #1 New York Times bestsellers The 9 Steps to Financial Freedom and The Courage to Be Rich and the national bestseller You've Earned It, Don't Lose It. The personal finance editor for CNBC and a financial contributor to NBC's "Today," she is also a contributing editor to O: The Oprah Magazine. A sought-after speaker who has lectured widely throughout the United States and South Africa, Suze Orman has been featured in Newsweek, The New Yorker, The New Republic, USA Today, and other publications, and has appeared numerous times on "Larry King Live" and "The Oprah Winfrey Show."
Love and Money
It never fails. When everything is working out between two people, they think love is so simple. Yet when the disagreements start, love becomes a complicated venture indeed. Often, the central complication is -- surprise, surprise -- money. Couples are always saying things like "Oh, money is killing our relationship" or "We were doing fine until money came between us." When I hear this, all I can think is that money has never done a thing to anyone, never hurt a fly. Money is just money. But it is the power you give your money, or your attitudes toward and your fears about your money, that can wreak havoc on the most important relationships in your life.
Not surprisingly, by now you may realize that you are in a relationship with money, whether you think of it in these terms or not. And like the other relationships in your life, this one needs work to make it successful. You must take actions that will create possibilities rather than destroy them, actions that will help you feel secure rather than afraid, and above all else, actions that will establish, in your private world, the sense that you are unconditionally loved for who you are and not for what you have. The first law of money states: People first, then money. It is also an essential law of relationships: People first, then money.
Which doesn't mean that money doesn't matter when it comes to love, because it matters a great deal. Of all the kinds of intimacy there are -- physical, emotional, domestic -- financial intimacy is perhaps the hardest to achieve, and, it could easily be argued, the most important in the long run. You can turn over your body, heart, and soul to someone, but the union will never be complete unless you link your fortunes (and misfortunes) together, too, for better or worse, and forever.
The Financial Courtship
You have met the person of your dreams. You have never loved anyone so much in your entire life. Finally you decide to get married or join lives and live happily ever after, till death do you part. The vows truly are holy, and you mean them with every ounce of your being. Could money get in the way of this love of yours? Not possible, you say. Until it does. If you haven't walked carefully and honestly through all the money issues ahead of time, I can promise you that money will one day become an obstacle in your relationship. Even if you think you have the subject well covered, you'll probably find that money becomes a problem later on: you change, your partner changes, the money grows or fails to -- all potential reasons for disagreement. Arguments over money trigger divorce in more cases than you can imagine -- arguments that are not necessarily based on deceit or lies but on how we deal with money. Because most of us deal with it very, very differently. This is so hard to understand ahead of time and so painful to discover after the fact. On your own, you handle your money your own way. You worry, sure, and sometimes perhaps you spend money you shouldn't -- you go overboard on gifts for yourself and others, occasionally you're late in paying your bills. Yet when someone else has a stake in your money and you have a stake in theirs, sloppy habits or reckless spending or even wildly divergent views on how to manage money can strike at the core of how safe and secure you feel and can make you feel violated in a very intimate way. When the first argument over money erupts, most of us are taken by surprise. And the only -- the only -- way to protect yourself and ensure that your relationship will thrive is to look at money issues in the most naked and honest way you can. Before you utter a single vow, and many times thereafter.
You must open the dialogue. Not just "Oh gosh, who's going to pay for what?" -- which we'll get to. But you must attempt to talk together in a rational, candid way about the serious side of money, matters that over time go from being background issues in a relationship to those of the highest priority -- how you spend, how you save, how well you share.
From The Courage to Be Rich by Suze Orman. Copyright © 1999 by Suze Orman. Published by Riverhead Books, a member of Penguin Putnam, Inc., Professional/Trade Division. All rights reserved.
|Introduction: The Soul of Courage||1|
|Part I||Acts of Courage|
|1.||The Courage to Look Within||11|
|2.||The Courage to Have More and to Be More||29|
|3.||The Courage to Make Room for More Money||41|
|Part II||The Value of Money|
|4.||The Courage to Value Money||61|
|5.||Defining Value and Worth||72|
|6.||The Courage to Face the Unknown||84|
|Part III||For Love and Money|
|8.||The Courage to Open Your Heart, The Courage to Open Your Hands||117|
|9.||The Business of Love||138|
|10.||Yours, Mine, and Ours||151|
|11.||The Courage to Transcend the Pain of Divorce||166|
|12.||The Courage to Live After a Death||188|
|Part IV||Buying a Home|
|15.||The Mortgage Menu||244|
|16.||Your Home and Your Future||265|
|Part V||Thinking Ahead|
|17.||The Courage to Create Your Financial Destiny||281|
|18.||Making Sense of Investments||292|
|19.||Seeking Safety in Bonds||317|
|20.||How Does Your IRA Grow?||356|
|Part VI||The Courage to Be Rich|
|21.||The Courage to Connect to the World||399|
|22.||The Courage to Be Rich||415|
Suze Orman: A little chilly, but nice.
Suze Orman: In 9 STEPS I asked you to look into your past, to see how your past is holding you back. In THE COURAGE TO BE RICH I start out with your present and ask you to stop blaming your past for why you aren't doing what you need to do. I ask you to see how your internal obstacles and external obstacles are keeping you from having more and being more, and only you have the power to release those obstacles. THE COURAGE TO BE RICH is made up of a journey of the intimate financial habits that husband and wife and life partners have between each other, or in reality don't have between each other. It goes into home ownership, the values of money, good debt, bad debt, and myths and realities about investments I did not talk about in 9 STEPS. It has new laws of money and it has five laws of life. It is 140,000 words -- brand-new words, compared to 85,000 words for 9 STEPS -- the only part repeated is the section on Roth IRAs, but the information is presented in a question-and-answer format in THE COURAGE TO BE RICH. Together with 9 STEPS, this book makes for a complete financial encyclopedia of your financial life, and I would be hard-pressed if I wrote another book to come up with any additional financial information that you would need.
Suze Orman: Obviously, some are better than others. My problem with them all, however, is that it is still my belief that those who get in later really don't have as much to make as those who got in at the beginning. As in anything that one does, there is a tremendous amount of work in MLM, and you really have to like being a general and leading your army if you are really going to make money. So I hope it is something that you will really love -- the product that you are selling and the management as well. It is hard enough in life to keep yourself, as well as those under you, motivated, and that takes courage.
Suze Orman: Phyllis -- absolutely not. Did you listen to Roberto Benigni the other night at the Academy Awards where he thanked his mother and father for giving him poverty? The courage to be rich comes alive when you have the courage to know you can create a sea of zeros out of one zero. When you stop thinking that those who are able to have more had it to begin with. Greatness can come from nothingness and the opposite is true as well. Don't think you have to have money to get more. For that is the biggest fallacy in life: Stop thinking such small thoughts. For with courage, the right actions, the right words, and the right beliefs, richness of all kinds can come your way.
Suze Orman: (1) If you have money in a 401(k), you can transfer that money to an IRA and then convert it to a Roth IRA. (2) You can continue as long as you have at least $2,000 a year and you don't make more than $95,000 in adjusted gross income; you can put $2,000 every year into a Roth IRA.
In the book, I give you the most complete chapter on Roth IRAs that you will find anywhere, in my opinion. And why every one of you, if you qualify, should have one. Please note that you can have one even if you max it out. My favorite mutual fund is currently the Vanguard Total Stock Market Index. Here is a tip for you: Rather than waiting till the end of the year to put in your $2,000, put in $166 every month, starting in January. If you funded your Roth IRA monthly over 40 years at just an 8 percent return -- which is conservative -- you would have $17,000 more in your Roth than if you waited and funded it at $2,000 at the end of the year.
Suze Orman: I am not concerned on any level. I would like you all to think about a few things. The computers overseas are the ones that are truly in big trouble. Do you think it is possible that money from overseas might be flowing into the market here in the U.S., causing our market to stay stable? Over the long haul, I think we will be just fine. I project us going over 10,000 and into a strong market into next year.
Suze Orman: I would definitely wait. I have done the calculations many different ways and the perfect age to purchase long-term care is between 54 and 59. One of my favorite companies is Continental Casualty. I ask you to compare the cost of your group policy at work to an individual policy at Continental Casualty -- you might be shocked to find that their individual policy will be less than the group one.
Suze Orman: There is no estate tax whatsoever due on this house. There will also be no income tax if you sell it. However, there will be probate fees to change the title of the house from her name into yours. The probate fees along with legal fees in the state of New York could run you close to $6,000 on this home. This could have been avoided if the house was held in a living revokable trust; then the cost to transfer the title would be nothing -- all you need to know is the difference between a will and a trust. I discuss this in great detail in THE 9 STEPS and my first book (YOU'VE EARNED, DON'T LOSE IT). The bills that you have paid will not play into the scenario here because you don't owe any estate tax.
Suze Orman: To say that she stole my business is not 100 percent accurate, but the forgiveness part came in me realizing that I needed to learn the lessons passed down in THE COURAGE TO BE RICH. I needed to learn that I wasn't just the car I was driving, the watch on my wrist, etc. I needed to learn about who I was without any money. I realized that was a far grander lesson that contained tremendous amounts of wealth, more wealth than any amount of money in the world could buy. It was a great gift she gave me. She didn't take anything from me and her actions truthfully backfired on her and were a gift to me.
Suze Orman: No. Nobody. I truly thought when I was younger that maybe if I was lucky I would be a waitress, which I was for seven years before I got my job as a stockbroker at Merrill Lynch. My biggest role model was Richie Rich in the comic books that I read over and over again. My mom and dad were so disheartened at their own financial situation that it truthfully felt like it was a life without hope at that time. It all changed for me when I had the courage to think while I was a waitress at the Butter Cup Bakery that I could have more and be more. And from that thought my whole world started to change.
Suze Orman: It is not necessary to put everything in trust if there is a named beneficiary and your only concern is how something passes down to that beneficiary. If your concern is that if something were to happen to you, such as incapacity and who is going to manage that for you, then it needs to be in the trust because otherwise your successor trustee won't have access to manage it for you. There is no downside at all to owning everything in trust. Always remember that it is not just about who gets what and how they get it after you die -- it is also about what if something happens to you while you are still alive. A trust can help you tremendously with that.
Suze Orman: Miss Helga, that goes back to step five in the 9 STEPS, where the law is, the more you make, the more you spend. It also touches quite significantly in the COURAGE TO BE RICH, in the law of "people first then money then things." You see, Helga, most of us think we are the things we buy; in fact, most of us value things more than we value money, which is why we have more things in our households than money in our bank accounts. In THE COURAGE TO BE RICH, I go into great detail about switching around our priorities and putting that law into effect: People first then money. It is not about having more money or making more, it is about knowing more about what you already make. If you have fear, shame, or anger -- the three internal obstacles that I talk about in THE COURAGE TO BE RICH -- it is those emotions that make you spend the money that you make, that sabotage your retirement and make it so that you never truly get ahead. THE COURAGE TO BE RICH points out how your emotional state is what determines your ultimate financial state, and that is the reason why no matter how much you make, how much you inherit, if you don't have your internal obstacles in check, the end result is your own checkmate.
Suze Orman: It depends on what you think your future goals will be. Do you have the desire to own your own home? Do you have a desire to marry and create a family? Or do you just want to start investing for yourself right now? The Roth IRA I like to start with for $2,000; you can get it out any time you want without any penalties or taxes. So it is like a tax-free savings account when it comes to your original contributions. And within the Roth IRA, you should buy the most aggressive and speculative investments possible, for obviously if you meet the guidelines of how a Roth works, those gains will be tax-free. Outside of a Roth IRA, I am a total advocate of either mutual funds (ones without commons, of course), individual stocks, or any form of growth investments to enhance your future. SPDRS are another favorite way of mine to invest on the American Stock Exchange.
Suze Orman: In THE COURAGE TO BE RICH, I give you four exercises of how to go through your house, what to look for, what to keep, what to throw away, what to give away, and what to value. I ask you to look at these quickly, do them right away, and I promise you will feel a total change in your outlook when it comes not only to who you are but how you spend your money. If you want to do something right away, balance your checkbook. For most of us have as much financial clutter as we do clutter in our house. And I know all of you are afraid to balance your checkbook because you don't think you have any money. Did you ever once stop to think that maybe a deposit that you made into your account never hit your account, and the reason you are bouncing checks isn't because you miscalculated, but because you weren't credited the money you deposited? The best way to turn toward your money is not to be afraid of it. So if you have credit-card debt, also total up how much you actually owe and face that debt with pride, not shame.
Suze Orman: That is actually a necklace that represents the Vishuda chakra, which is your power or speaking chakra. It was given to me while I was in India by a woman who is considered a living saint in India. I never take it off and I truly consider it my most treasured item. Thank you for noticing it; Oprah did too, on the last show.
Suze Orman: I would absolutely take a loan out of my 401(k) to pay off my credit-card debt. The average stock this year has decreased 6 percent. I doubt very much this year that you are getting more than 9-10 percent this year within your 401(k). Therefore, take a loan and pay it off and pay yourself back. In the long run, you will do far better.
Suze Orman: In THE COURAGE TO BE RICH, there is a tremendously vital section on dealing with the death of a loved one -- what you need to do and how to get through it emotionally. There is also a vital law in this chapter that it is essential that you read about how to protect yourself from the money as well as from others who will want to invest that money for you after you have experienced the loss that you did. The book also has a chapter on how to start over. Even though I know your loss was one of death, the book has equally as much detail on when one suffers a loss from a divorce. I ask you to please read it before you do anything, for it really will protect you. And, hopefully, aid you in giving you the courage that eventually everything will be OK. My love goes out to you. For money can never replace love.
Suze Orman: THE COURAGE TO BE RICH isn't just about getting more money. I would be the last person in the world ever to tell you that money alone will ever make you happy. But I would be the first person to tell you that a lack of money sure can make you miserable. I know plenty of people who have lots of money and they are anything but rich. It takes courage to face anything that we are afraid to do. It takes courage to face anything that we fear. And I know nothing in life that we fear more than our money. THE COURAGE TO BE RICH comes alive when you value doing what is right over what is easy. When you value today along with your tomorrows. And that each and every one of you knows that you truly can be the master of your own financial destiny. Please don't ever think or let somebody else tell you that you can't be anything and everything that you ever dreamt possible. From the bottom of my heart, I thank you all for my support. And may you always remember to think great thoughts but relish small treasures. Let's all walk into the new millennium not powerless, not penniless, but with the courage to be rich.
Posted March 11, 2010
I Also Recommend:
This book is not so much about financial advice as it is about how your thinking can impact your ability to reach your financial success and dreams. The book looks at attitudes and core beliefs - in this respect, it is excellent.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted April 11, 2003
I find this book extremely instructing. She is not only talking about money at the level of money, but emotion, which a lot of us ignore. Not only that, I learned a lot from her book. This is the first book of hers that I'm reading and I expect more from her new books.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 14, 2002
I bought this book hoping to find some real insider tips to saving money and building wealth. However, I found the book to be overly simple. Author does not explore any of the subject in greater detail. Not recommended.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted June 28, 2002
Posted March 31, 2001
The Courage to Be Rich provides support for overcoming your stalled thinking about money. If you lack confidence about money, have money problems, or have bad feelings about your relationship to money, you will find this book helpful. I have graded the book from the perspective of people in this category. On the other hand, if you have lots of money and feel good about what you are doing, you will hate this book. This is a self-help guide more along the lines of Unleash the Power Within than it is a financial guide. If you want to add to your perspectives about how to make more money, I suggest that you shift to Rich Dad, Poor Dad instead. For you, The Courage to Be Rich is a one star book. I appreciate the care and consideration Ms. Orman shows to her readers who may be suffering from emotional overwhelm (such as often occurs during and after a divorce, after a loved one dies, or while buying a first home). Her lists will probably help these anguished souls. Although money has a lot to do with math, Ms. Orman correctly perceives that it is all about emotion as well. Emotion and math do not mix well, and she provides many useful insights into how to make them work better together. An experienced and credentialed psychological counselor she is not, however. I suspect this book would have been better with two co-authors, one who is an expert on emotions about money and the other who is an expert on money to supplement Ms. Orman's skill as a communicator. Ms. Orman is neither, so th is book's treatment is pretty lightweight in both areas. But if it gets you started in dealing with your issues, all the better for you. The only part that seemed totally inadequate was her writing off of tax issues: You will spend a lot of money on taxes in your life and your choices do have a large impact on how much you will spend. Her advice is to feel good about paying more taxes because your income is higher. By contrast, someone who really wants to be rich needs to compound as much money tax-free or tax-deferred as possible. This book does not begin to address that subject. The Courage to Be Rich is a better book for dealing with specific life traumas such as divorce, death, and so forth. This book would be a good gift to a friend who has such an event in his or her life. Her stories are good, because they bring home the message of how crippling too much emotion can be, so we take this problem more seriously. I think the biggest misconception people have about money is that they do not need to address their feelings about money. In that sense, Ms. Orman is doing a lot for us by reminding us that we have deeply held beliefs and attitudes that deserve being reexamined from time to time. I enjoyed reading the book, although it only added to stockpile of stories, rather than my knowledge. Maybe the book's obvious appeal for general audiences can best be understood by thinking about the experience of watching a tear-jerker of a movie or television show -- you get a great feeling from knowing that the cataclysm is not happening to you. If you have heard Ms. Orman speak at length on television (which she does a lot), you can probably safely skip this book. To get a good return on your time with this review, I suggest that you pick one belief about money that you have where strong emotion comes into play. If that emotion does not serve you well, rephrase what you believe until it does serve you in the right way. Then, you'll have mastered a skill for having more! Live with rich thoughts and warm emotions! Donald Mitchell, co-author of The Irresistible Growth Enterprise and The 2,000 Percent SolutionWas this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.
Posted September 7, 2000
I read this book and it is one of this year's best. Achieving financial freedom is the first step toward independence. If you don't have financial freedom, you don't have anything. So please do yourself a favor and pick up a copy.Was this review helpful? Yes NoThank you for your feedback. Report this reviewThank you, this review has been flagged.