Although this blog is mostly about economics and investments from a libertarian standpoint, it is also about general advice on money.  I have written before on Dave Ramsey and Suze Orman, but I think it is worth repeating.  Although the two of them may have some differences, they are also similar in a lot of ways and I am going to lump them together for the sake of this discussion.

For people with spending problems, I would highly recommend listening to these two.  Give each of them a chance and see which one motivates you more.  If you are in debt (other than maybe a reasonable mortgage and car payment), then you should seek advice.  You should work extra hard and save extra hard to pay off your debt, especially if it is on a high interest credit card.  As Dave Ramsey says, eat “rice and beans”.

I heard Suze Orman once say that she is not in favor of budgets.  I agree with her on this, although I think exceptions can be made.  She said that budgets are like diets.  If you want to be healthy physically, you shouldn’t diet.  This implies that it is temporary.  You should eat healthy as a way of life.  The same is with spending.  You shouldn’t buy something or not buy something because it is or isn’t in your budget.  You should be disciplined to spend only on things you need or, if it is a want, it should be something that you will use and something that truly is worth what you are paying for it.  In other words, your spending should be based on a reasonably frugal lifestyle, not on a budget.  It doesn’t mean that you never treat yourself; it just means that you prioritize.  Part of prioritizing is paying yourself first.

I have heard both of them offer good advice in other areas.  I have heard Suze Orman say several times that she is in favor of term life insurance and not whole life insurance.  I have heard both offer advice that goes way beyond money.  Sometimes it is more like listening to Dr. Phil.  Now I’m not saying they are always right, but certainly their advice is worth listening to and considering.

With all of that said, there is one area that I would recommend you not listen to both of them.  Neither one of them understands Austrian economics.  They do not understand the workings of the central bank.  They don’t understand the dangers of a fiat currency.  They don’t understand the boom-bust cycle and how it is caused by central banks creating money out of thin air and artificially lowering interest rates.

This is why they tell you to invest in mutual funds.  They tell you to buy and hold and that the market will provide good solid returns over the long run.  They do not understand the benefits of having gold and other metals and commodities in your portfolio.  They don’t understand that gold is a much better hedge against inflation than stocks.

If you are looking for advice on investing, read Fail Safe Investing by Harry Browne.  Follow the advice on the permanent portfolio.  For other advice on money, I think Dave Ramsey and Suze Orman are worth listening to.