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Suze Orman says stop wasting money on amenities. Here’s why I disagree

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This is advice that applies to some people, but not everyone.

Key points

  • The small purchases we make can add up over time.
  • While Orman thinks many of them are a waste of money, they offer value on their own.
  • Some small purchases can make your life easier or happier (or both).

Financial expert Suze Orman is a very wealthy woman, but there was a time in her life when she was anything but. In fact, Orman went through a period where she was so broke she had to sleep in her car because she couldn’t afford to put a real roof over her head.

As such, Orman is invested in helping people achieve financial security and break the cycle of unhealthy debt. To that end, she is a strong advocate of having a strong emergency fund. She even thinks it’s a good idea to save up to 12 months of living expenses in a savings account.

But while Orman has plenty of great advice for the average consumer, in a CNBC interview, she made it a point to tell people to stop spending money on amenities. And while that’s good advice for some people, it’s not necessarily good advice for everyone.

Small purchases really add up

You might think that the occasional store-bought coffee or ordering takeout won’t have a big impact on your finances. But Orman argues that over time, these small purchases can really add up and hamper your financial goals.

She’s right about that. It’s one thing to order takeout four times a year. It’s another thing to order it four times a month. The latter can mean not being able to pay off a credit card balance or having to drag on to pay a Personal loan when it could have been closed earlier.

But while Orman’s advice not to waste money on amenities is fine for some people, it’s pretty extreme for people who aren’t in poor financial shape. Orman has been quoted as saying, “Stop doing the things that waste your money and make your life easier, because in the long run it’s going to make it harder.”

But here’s the thing – if you’re doing well financially and achieving your goals, then why should not Do you treat yourself to take-out if you’ve worked a lot of hours in a given week and don’t feel like cooking? What if you maxed out your IRA for the year, increased your emergency fund and has no debt other than, say, a mortgage, why should not do you pay for a cleaning service if you hate scrubbing toilets or don’t really have the time?

If you wear credit card debt and you don’t have a full emergency fund, then yes, you might want to take Orman’s advice and stop spending money on amenities. And if you don’t have retirement savings in your name, the same is true. But if you are in a more comfortable position financially, you have earned the right to use your money to make your life easier.

When small purchases are not wasted

It’s easy to view things like takeout and ride-sharing services as a waste of money. But if those things make you happy and make your life more manageable, then they’re not really wasteful, because they add value in some way.

The store-bought coffee you drink in the morning is not an asset that can rise in value like stocks. So it’s pretty easy to argue that investing $3 a day in the stock market will do more for your finances. But this coffee could do so much more for your daily happiness and outlook. And you should not overlook its importance.

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