Bogleheads

[yuag]

MSN recently posted an article blasting Suze Orman at:

http://tinyurl.com/a9mxay

Now I'm not a fan of Suze's recent recommendations, and totally agree with the author on how she secretly markets her products to people, but there were two things the author brought up that sort of go against what I thought was a good way of thinking:

1. The author mentions that she recommends dollar cost averaging, and even if the stock market is going down, it's okay because you are buying stocks on sale. The author says doing this is throwing good money after bad. I don't think this is necessarily a bad idea if you're investing in sound mutual funds (index funds, for example). If you have a plan, and you stick to your plan, you don't worry about the ups and downs. That's the whole point about dollar cost averaging.

2. The author then says listening to her is like listening to financial tabloids which have been pushing 'no-load' mutual funds as the "new" thing. Now I know you can debate about loads vs. no-loads, but why is investing in no-load mutual funds necessarily a bad thing? If you're in Vanguard index funds aren't you paying low expenses, minimal fees compared to high expenses and fees in loaded mutual funds?

[Adrian Nenu]

[etc06]

[ddb]

[JaneDoe]

[philip]

[ddb]

[bearwolf]

[Harold]

Suze offers good general personal finance tips to a populace who have never learned to manage their personal finances. For that reason alone, I like her and think she's a good influence to have around.

I find the venomous visceral reaction to her on this forum to be quite interesting (and puzzling).

[philip]

[FrugalInvestor]

[fishndoc]

[daryll40]

I also vote in favor of Suze. Her attempts at market timing have been bad and her on air persona ("you go girl") attitude sometimes gets on my nerves. But the average viewer keeps hearing her "live within your means" message over and over in many different ways. That, in itself, sets her light years ahead of most of the other financial messages being beamed at all of us every day.

[Adrian Nenu]

[yuag]

[dm200]

Suze says:

[richard]

Counter-point to the article
http://www.portfolio.com/views....n?tid=true

A well written defense of Suze

[FrugalInvestor]

[cosmos]

[Adrian Nenu]

http://www.sfgate.com/cgi-bin/....U35154.DTL

Why Suze? Why All the Hype? Orman's Publicist Goes on the Defense
But best-selling author drags her feet on clearing up the mess


Adrian
anenu@tampabay.rr.com

[Swivelguy]

DCA prevents you from making an unlucky inadvertent market-timing move. If you invest a lump sum (inheritance, etc) in stocks all at once, you risk buying on the single market-high day of the year. By DCAing (or gradually adjusting AA) over a reasonable period of time, you reduce this risk substantially.

As for Suze Orman, the problem with her show is that because a viewer might be tuning in for the first time every single week, all she has the opportunity to do is repeat Day 1 of Investing 101. She never gets a chance to talk about asset allocation, the benefits of tax deferral, etc. The same is true of CNBC's On The Money, which is basically the same show but without Suze's coarse personality.

I think Suze's show is a good thing, though, because it gets young people to seek out further information and make the right choices. That's how I ended up here.

[joshm34]

I'm not the biggest fan of Suze Orman, but many of her core messages are sound. This was a horrible article in my opinion.

[ryuns]

I believe the gurus like Suze and Dave Ramsey are popular due to intellectual laziness or ignorance. They probably do, on par, more good than bad. They've motivated a ton of people to actually pay a little more attention to their finances, get out of debt and all that.

But I think money is a tremendously important aspect of people's lives, for better or worse. When I started coming to Bogleheads.org (then diehards.org) it was far over my head, but I stuck with it, read the Bogleheads Guide and some other books, and learned. People who listen to Dave and Suze have a very unsophisticated knowledge of finance. A pet peeve of mine is Dave's snowball method for getting rid of debt. I think it's insulting my intelligence to think that I pay off debt in a mathematically sub-optimal way but feel better about it because the accounts are (slowly) disappearing. I think the listeners should respect their own intelligence enough to learn actually learn how to deal with their money. It's not all good feelings and slogans. Sometimes you need to open a book and struggle a little.

That's all to say that we Bogleheads have a far better understanding of finance than most of their listeners, and many probably know more than they themselves. And that's why we throw down the negativity on Suze. That and she seems like kind of meanie.

Ryan
_________________
An inconvenience is only an adventure wrongly considered; an adventure is an inconvenience rightly considered. -- GK Chesterton

[ruth03]

[yuag]

what are your guys thoughts on the second question, with the author's comments on no-load mutual funds?

[Adrian Nenu]

Orman has no formal training in finance or financial planning and never had clients except during her stint at Merrill Lynch. Everything about her is based on marketing book sales, essentially a cheap & cheesy late-night infomercial. She's a salesperson just like the vast majority of people in the financial planning industry.

Adrian
anenu@tampabay.rr.com

[Adrian Nenu]

[Harold]

[dbr]

[lostcowboy]

I think that Susie just repeats things she has heard from other people that she thanks are cool. I am sure she was shown that little table that demonstrates how well DCA works.

I like this comment of her's "As she trilled to The New York Times Magazine a couple of years ago, "I have a million dollars in the stock market, because if I lose a million dollars, I don't personally care."". There is a old saying about the stock market that says only invest what you can afford to lose, looks like she took it to heart.

[richard]

[ruralavalon]

[canucknyc]

I can't stand her personality, but I would agree that I think she does more good than harm and I found it really bizarre that the author chose to pick on DCA (I think he really means PI - what I've heard Suze talk about sounds a lot more like PI than "DCAing in") and no-load mutual funds. Seem like pretty reasonable investing approaches to me!

With regard to the fact that she advocates stocks but only has a small % of her personal wealth in them - I don't see that as hypocritical, but rather strict adherence to the mantra of ability and NEED to take risk.

Lastly and most importantly, she makes for a great character on SNL!

[LazyLizard]

But still...the article's author writes:

[Swivelguy]

[axtec]

Funny... a Google ad to the right of the article caught my eye:

Suze Orman's FICO Kit
Get Suze Orman's FICO Kit now, Learn to put
your FICO score to work.

In an article openly blasting her, they were also advertising (supporting) her.

[JaneDoe]

[grok87]

[ddb]

[EmergDoc]

Once more the concepts of dollar cost averaging and periodic investing are confused in this thread. You can only DCA if you have a lump sum now. If you don't have the money yet, you have no choice but to periodically invest. The debate is allways DCA vs Lump Sum. If there is no lump sum, you are periodically investing. Same benefits as DCA, it's just that you have no choice.
_________________
1) Invest you must 2) Time is your friend 3) Impulse is your enemy
4) Basic arithmetic works 5) Stick to simplicity 6) Stay the course

[grok87]

[chaz]

At least Suze Orman, who authors books, made her most recent book available free by an online download.

However, people on this forum do not need her most recent book.
_________________
Chaz
"It is better to travel well than to arrive." - Buddha
http://www.bogleheads.org/wiki/index.php/Main_Page