Warning: Highly-opinionated post! Do not read if you are a Suze Orman fan
The Money Class show
At the request of a friend I recorded “The Money Class”, a new show by Suze Orman. While watching it, I tried to put my personal opinions aside to see the true message she is sending. Notice I used the word “sending” because I really felt more like she was TELLING us what to do instead of TEACHING us what to do. OK, give her a chance Steve.
The first 30 minutes
Suze talked to some people, seemed genuinely interested in their lives, and gave some good advice (noticed I used the word “some”). As I said in my podcast episode “Defending Suze Orman”, she is leading people in the right direction down the field. I can support that. Some of her advice was spot on, some of the show was exaggerated for TV, and the stories from guests were interesting.
Using the 4-letter word
Leading into a break she said it, she said the 4-letter word. Quote: “Up next, the 4-letter word that could save you thousands of dollars. It’s spelled F-I-C-O”.
That was it. I had to shut it off. I get too upset hearing someone mislead you about your finances, so much so that I feel like Darren McGavin playing Ralphie’s old man in “A Christmas Story”, ready to rip out a torrent of nonsensical words to replace things I would never really say out loud. Suze was just making a silly statement to get our attention to keep from changing channels.
FICO does not save you money
If FICO score lending didn’t exist then everyone would be offered the same rate. The only reason interest rate comes into play is when companies want to measure their level of risk in lending you money (which I agree with). Companies are more likely to lend you money if you have a history of paying bills on-time (notice I said BILLS and not just DEBTS) than if they knew you had a problem paying bills. So a FICO score does not qualify you for a good rate but will DISQUALIFY you if there is any hint of a bad payment history.
Making FICO irrelevant
Saving money for future purchases would make FICO irrelevant. I guess it could come into play when applying for a mortgage or refinance, but there are other options like eCredable or good old-fashion underwriting that will qualify you for a good rate.
The Money Class Drinking Game
If you must watch The Money Class, take a drink each time you hear Suze Orman say the “F” word. Your only alternative is to stay sober and follow her advice about taking out loans, maintaining credit lines, and making interest payments. Either way, you would wake up asking yourself “what happened to my money and how did I get here?”