Suze Orman Tells Oprah Instead Of Starbucks Everyday, A 25-year-old Putting $100 A Month Into Roth IRA Would Have $1 Million By Retirement

At the 30/50 Summit in Abu Dhabi, financial guru Suze Orman emphasized the immense value of consistent, small investments over daily indulgences. In a conversation with American talk show host Mika Brzezinski, Orman illustrated this by comparing the cost of a daily Starbucks coffee to the potential growth of a Roth IRA. Orman explained that if a 25-year-old skipped their daily Starbucks and invested $100 a month into a Roth IRA, they could amass $1 million by retirement.

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Recounting her appearance on the Oprah show, Orman said Oprah asked what people are wasting their money on, and Orman told her Starbucks. "I said, Oprah, do you know if you were 25 years of age and you bought a Starbucks every single day and rather than doing that, you put $100 a month into a Roth IRA, a retirement account, and you did that every single day until you were — you’re 25 so let’s say till 65. You average 12% on your money over all those years. Do you know at the age of 65, you’d have $1 million? So all of you are paying $1 million down the drain?"

Orman's advice underscores the importance of prioritizing long-term financial goals over short-term indulgences. "I’ve never bought a Starbucks in my life," Orman declared, emphasizing the significant financial impact of such small, consistent investments.

During the interview, Brzezinski also asked Orman about common financial mistakes women make, particularly after age 50. Orman didn't hesitate to pinpoint the primary issue. "Not really knowing where their money is," she said, highlighting the lack of financial engagement many women in their 50s, 60s, and beyond exhibit. "Especially the 50s, the 60s, the 70s," she noted. "We thought we were in the perfect relationship, and now we’re not. We thought our perfect partner was going to live forever, and then they died. And here we are, and we don’t know what to do with what we have."

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Orman hosts the "Women & Money" podcast, where she often addresses these concerns. "In our 50s, we didn’t want to get involved with our money. We didn’t want to take a realistic approach to ‘Oh, of course, we’re gonna get older, of course, there’s gonna come a day that we retire. We’ll always be able to work for money, so I don’t have to save it, I don’t have to think about it.’"

Brzezinski mentioned Orman’s strong stance on dining out and frequent small expenses. "You recently told The Wall Street Journal that you believe dining out is a waste of money," Brzezinski remarked. Orman affirmed, "I would drop dead before I bought myself a cup of coffee," much to Brzezinski’s amusement.

Brzezinski defended her love for Starbucks, admitting, "I love my Starbucks. It tastes different, Suze." Orman countered, "Why can’t you make that at home and just bring it?"

For women over 50, Orman’s advice is a crucial reminder to reassess financial priorities and actively manage their money. "Women still give more to others than we give to ourselves," Orman reiterated. "And that is a really big mistake."

The key take-away from Orman's insights is clear: making informed financial decisions and prioritizing long-term investments over daily indulgences can significantly enhance financial security. Consulting a financial advisor to create a tailored plan is a crucial step toward achieving a comfortable retirement free from financial worries.

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