Want to retire early? You’ll need at least $5 million, more likely $10 million, says famous financial personality Suze Orman.
I should know. She said that to me, directly, on this podcast.
I asked Suze for her opinion about a frugal, flexible person who wants to retire early with a $2 million portfolio. She warned that retiring would be a massive mistake.
“Two million dollars is nothing,” Suze said. “It’s nothing. It’s pennies in today’s world, to tell you the truth.”
Wait, what?
“Listen,” she said. “If you have $20 [million], $40 [million], $50 [million] or $100 million dollars, be like me, okay. If you have that kind of money … and you want to retire, fine.”
“But if you only have a few hundred thousand dollars, or a million, or $2 million, I’m here to tell you … if a catastrophe happens … what are you going to do? You are going to burn up alive.”
But what’s wrong with retiring early on $2 million? Assuming it’s invested 50/50 in equities and bonds and harvested at a 4 percent withdrawal rate, a portfolio of $2 million could create annual investment income of $80,000. Surely that’s enough, right? Riiiight?
Nope. Suze says that’s not enough.
“I think that in the long run, $80,000, especially after taxes and as you get older, is not going to be enough. You may think it’s going to be enough, but it’s just not,” she told me on the Afford Anything podcast.
“You can do it if you want to. I personally think it is the biggest mistake, financially speaking, you will ever, ever make in your lifetime.”
I asked her if a $3 million portfolio at a more conservative 3 percent withdrawal rate would be okay for an early retirement. She said no.
“Think about it logically,” she said. Supporting a disabled family member who needs full-time care could cost $250,000 per year, she said. Ordinary cost-of-living would cost another $100,000 per year. This means you’ll need $350,000 per year after taxes to cover your costs, which is $500,000 per year before taxes, which at a 5 percent withdrawal rate means that you’d need a portfolio of $10 million.
If you don’t have at least $5 million or $10 million, don’t retire early, Suze said.
“Here’s what the FIRE people, you are not thinking about, so I’m going to give it to you straight here now,” she said.
She described the possibility of getting sideswiped by massive taxes and catastrophic emergencies. What if your home gets destroyed by an earthquake or flood and insurance denies your claim? What if you’re in a tragic car accident and you need full-time care? What if the U.S. experiences 25 percent unemployment, which means you won’t be able to find another job if you wanted one? What if your investment income gets consumed by massive future tax hikes?
“When you get older things happen,” Suze said. “You’re hit by a car, you fall down on the ice, you get sick, you get cancer. Things happen.”
“Alright, you can do it if you want to,” she said. “I’m just telling you, you will get burned if you play with fire.”
You can download the transcript for free here:
Listen to the episode here:


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Kate Stephens
Well done Paula for playing this episode which I’m sure you had some sleepless nights over! I’ve always liked Susie O but not anymore! It wasn’t what she said (although I didn’t think it was based in fact) her arrogance was quite frankly disgusting. Her comments on her own wealth were truly ugly and uncivilized. She belittled the efforts of people who had done something extraordinary – saving hard to get to $2m is something most people never do and to suggest this amount of money is “nothing” is enormously out of touch. Also most Americans live on $50k a year so to suggest $80k a year with no debts is ridiculous is out of touch. She lost all credibility with me. You however were amazing! So composed. Asked great questions and kept the interview moving. I like to listen to opposing opinions as it makes us question our own path and goals and this did that. Making sure that you are adequately insured and have enough for a rainy day is important. I think $2m and $80k a year plus insurance would be a better place to be than 95% of the population if catastrophe strikes. I’m a long way from that but that is my goal. Keep being awesome Paula!
Jay
The problem with Suze Orman is that she’s….well…Suze Orman. Fewer than 1% of US HH will ever have 10M. Out of touch? That’s too kind. Simply put, she just doesn’t get it.
Nigel
Too easy to pick on Suze. This episode was like watching somebody (who isn’t around to defend herself) get bullied. Painful. Unfortunately Suze brought it on herself…
Mary
Actually it was not fair for Paula to stay quiet during the interview but now picks apart what Suze said when she can’t respond.
Paula Pant
Suze is welcome to say anything she wants to about me on her own show! 🙂 It’s my show, not hers. And likewise — she has her own show/books/platform, where she can say whatever she wants.
John W Sutherland
Paula you handled the interview right – i dont think offering a stronger response during the interview would have helped the situation and it may have made Suze even more assertive.
thomas
I just discovered your podcasts show I like what I’ve heard thus far I want to learn more and get my finances really back in the right way I’m 49 yrs old receiving disability few hundred dollars I feel like a total fuck up please please gibe some advice
Barry
Paula,
Your simply an amazing Pod Caster and this interview just proves it. I think Suze is ill informed of the FIRE movement. Sounds like she was on her book tour and returning to the lime light, asked her assistant to give her a brief run down on the FIRE movement before the interview was conducted. I hope her assistant has FU money because they may need it. She will undoubtedly blame them for Suze’s ignorant statements. I just wonder what Dave Ramsey would say to Suze’s comments since he celebrates everyone who can cross the 1 million mark.
I will just move forward being FI, I do not want a private jet nor do I want to own an island. Too much upkeep with employees and maintenance cost. I would rather travel. Suze is unfortunately now some what irrelevant. Seems like she has just alienated the future millennial population. If Suze is hoping gather a new flock of followers, she just exposed herself as un relateable.
Mary
Suze has empowered women long before most FIRE followers has been around. I totally agree with Suze if you go with the traditional definition of Retirement as “ceasing to work” but this movement has redefined Retirement and shouldn’t be called FIRE and just FI. I believe in being financially independent. If you give up an “earned” income at a young age, you are leaving too much money on the table especially with Roth and compound interest. Also for those who have not personally experienced a catastrophic illness (and does not have to be health issues) that can bankrupt you, you haven’t lived long enough. I’m a cancer survivor, my friend’s 23 year old son is going through stage 3 testicular cancer, my daughter’s boss’ husband died from lymphoma in early 30s…I could go on but I feel Suze bashing is uncalled for. A confident woman is considered arrogant but what if she was a man! Just redefine this movement…I can compare this movement to Dave Ramsey who says to find a vocation that feels like a vacation! Remember life never turns out how you plan….LIFE HAPPENS!
Paula Pant
I agree — “FI” is more accurate than “FIRE,” and I’ve talked about that on the podcast (in previous episodes) several times. Retirement is one of many possible options that could arise after FI, but you could also choose a huge variety of other paths. The purpose is FI, not RE.
Here’s more detail on that idea: https://affordanything.com/how-much-is-enough/
Perry
I was frustrated by her skewed numbers. A decent nursing home where I live is about $4500 a month. I send my kids to local private school $4100 per year not $50k. Sure she spent $35k per month on her mother’s care as she has millions. Most kids aren’t going to Harvard. State schools are way cheaper.
Suze’s 90’s style of polarizing grandstanding and use of fear is tiresome. Please bring logical arguments that can be discussed. Not all of us aspire to aquire our own island Suze. Where your money is so too is your heart.
She doesn’t regret her time traveling in the van but no one else should do it. Get working and start contributing to her system. I’m glad there are outlets like Afford Anything where you can get honest, rational and most importantly useful information.
Paula Pant
Thank you so much, Perry.
The numbers that she cited were shocking — and raised the question, how could ANYONE in the middle-class or upper-middle-class, regardless of whether or not that person is interested in FIRE, pay for the expenses that she’s quoting?
Her idea that you’d need at least $350,000 per year after taxes (in today’s dollars) …. what??
Rebecca Anderson
Paula,
Happy to hear the follow-up. I think we all need to replay replay and digest all of this. Way to have the guts to first off sit down with the great Suze. I am not sure anyone can net prepare for that force.
She has amazing experience and to tell the truth she can’t forecast the future none of us can but we somewhat can can’t we? I take from her the most simplistic words to cation against everything as change is coming. Yes she is condescending as hell as usual but that is what you expect if you play with her brand her fire.
I am happy to see you are revisiting some of her statements some of her comments. I believe 2mil is not enough either. Doesn’t mean you can’t survive which you will but it will be at whatever level that will be in 30-40 years and I would not take that risk either.
Now bring her back on and put your questions back at her as this is a debate way to awesome to not take to the finish line. Each side has valid points but 2 mil is not enough if social security continues down its path. Bring her back it will be worth it, it will be a much better interview now.
Paula Pant
I’d love to have her back on the show! We’ll see if she agrees to another interview. 🙂
Lamont Cranston
Suzy is just detached,
If, after a 40 year working career with your family earning the mean income, your total
earnings are only $2.3 Million. Even with market returns, how can a family save $5M or $10M?
Note that I used Mean household income to be optimistic, the median household income is lower and would be under $2 Million of lifetime earnings.
Suzy just doesn’t have a clue about the normal American lifestyle.
Personal situation, family earned about $2M and after 40 years of saving, (from year 1) we have a NW of about $2M.
And she mentions living on $80,000, We have been living on $50,000 and less for, well, forever!
I guess it can be done, and that was with kids!
Lisa
Thank you, Paula, for going out on a limb and asking Suze on your show – even knowing that this would might alienate some in the FIRE community, I appreciate that you were willing to listen to some different viewpoints on the movement. My aspirations are FIRE and within that community I also find that I do several things that Suze recommends – people over things , Living within my means, being thoughtful of my future (when I will be taking care of aging parents and children). I don’t think Suze’s ideas are actually that far off from the FIRE movement – I just think she is not well informed about the movement. I appreciate that you feel it’s your mission, Paula, to make sure that people are clear on what FIRE is but I personally think there is a lot of good information out there (including this very POdcast!!) that is not difficult to find if Suze had been willing to be open minded about what different folks are doing in the movement.
Thank you for being willing to be criticized for having a controversial guest and also for coming up with some great questions for her.
A faithful and grateful listener,
Lisa in Baltimore
Paula Pant
Thank you Lisa! I got a little pushback, but overall it’s been a great experience. And this reinforced my mission to keep spreading the FIRE!!
Menard Solve
Her argument that Artificial Intelligence will cause unemployment and consequently raise everyone’s taxes is complete bull. AI will disrupt certain industries, but it will create more jobs than it destroys! Back in the 60’s and 70’s people were saying the same things about Computers and Teller Machines. But guess what? There are fewer bank tellers but it created more jobs in banking technology, construction, and communication sector because it became cheaper to build branches. The World Wide Web created more jobs than it destroyed: from web developers, content marketers, SEO experts, virtual assistants etc.– jobs that didn’t exist in the decades prior.
Josh
This was fun to listen to…
BUT I wish you had discussed some ways of dealing with the issues she raises. My mother is getting older, and I am completely worried about needing to pay for her care without going broke. I don’t think that’s a black swan event either.
Paula Pant
That’s coming up in future episodes! We’ll bring on experts who specialize in these topics and can deep-dive into this subject. 🙂
Stacey Leigh
Hi Paula and FI community!
I’ve listened to the interview several times now. After a week of reflection, here’s my take: Suze Orman is someone that I hold in very high regard. I feel this is Suze being exactly Suze. She is dramatic and over the top. She takes her point to the extreme on the regular right? That’s how she gets us to think things over, by making us have an emotional response. It worked for me. This interview scared me and challenged my plan. So I tooled with my FI spreadsheets to see the impact of instead of an outright retirement for me, perhaps I will stay on and work part time in a more enjoyable position. This continues my family health insurance and our disability and life insurance while adding to our nest egg.
It adds an additional $2M to our fund and allows me to dial down my race to urgent FI so I can enjoy the here and now a bit- family vacations, a few getaways with my husband, some treats for the kids,etc. I’m killing myself working towards freedom.
What hit me was retiring with just enough to get by and the thought of an unexpected illness for my husband or family. I would have to just let them pass? No way! I will be covered for anything now! These are very important decisions we’re making and all angles should be taken into consideration.
Thanks Paula and Suze 😊
GenX FIRE
There is such a thing as long term care insurance. My parents have it. I suggest it.
That being said, for me, I am looking to be able to downshift. Ironically, I see the FIRE movement as protection against the big events. I am not fully comfortable with no longer working, but I would like to be in a place where it’s my choice. To take that level of stress off the table, to go to work, even my current job, and think “I can stop whenever I WANT.” That is freedom to me. That is financial independence, even if I don’t retire until 60. My early retirement goal is 55, so not that early. I got a late start, but that is another story.
Bonnie Truax (43BlueDoors)
Paula,
I love how you brought in the question about normal people retiring on a normal salary. Evidently, that is OK cause “they did their best”
Your wrap up at the end is perfect. I’ll try to do my part to spread the FIRE and help alleviate the misconceptions
Paula Pant
Thank you Bonnie, for spreading the FIRE. 🙂
Mike
I was expecting to get aggravated and not listen to the whole interview, but WOW, I could not stop.
The saddest thing I herd was that Suze’s own mom doesn’t take her daughters advice.
The content seemed to jump all over the place, is the $10 Million needed to retire at 25 or at 65? Given that the Bull market keeps making new highs it is no surprise the caution statements coming out of main stream media. It would be nice to see the advice/suggestions summerized and divided into age groups.
My main takeaways from this was 1) Suze is trying to sell her book and 2) Know your future risks and how you will handle them.
You have a new subscriber 🙂
Mike
Paula Pant
Thank you Mike! Welcome to the Afford Anything community! 🙂
RayinPenn
Losing a cousin to suicide (over money) and watching people make poor financial decisions time after time can affect your perception of the world. The reality is very few people will retire with 5 million dollars or even half that. We have diligently saved, are well prepared for retirement and still worry about health care and L/T disabilities (like nearly everyone else) but I choose to reject Suze’s negativity as it simply doesnt help. I walk twice a day, she hits the treadmill we do what we can.
Suze did have one gem that few FIRE people need ask themselves? Is retirement what you crave or hating the work you presently do the issue. Im 64, FI for a very long time and have an amazing, stimulating, well compensated technical job (4 days a week). If I were in a job I was bored with or stressed over I’d have retired years ago. So is the issue the job? The stuff that you are a slave too? Or that dream you never pursued? What i retire Ill find something different and interesting to keep me stimulated.
Pam Brooks
It seems like we weren’t listening to the same interview. I heard Suze oppose people retiring in their 20’s or 30’s and never doing any kind of work again for the rest of their lives. She fully supported people changing careers or starting a business or taking time off for a while. She said that $2M is not enough to live on from your 20’s for the rest of your life if you never work again.
Reaching financial independence and continuing to earn an income is not retiring. It certainly is rewarding to be able to choose whatever career you want, but it’s not the same thing as no longer making any income and living off of investments only.
I didn’t agree with everything she said, but I didn’t find much difference between your position and hers.
Keith
Agreed. Holding costs down with aging, kids and all the other uncertainties of life is going to be difficult, probably impossible, for most. Most of us are not as resilient as we think, and will be less so over time. And your partner better be bought in 100%. If I hadn’t put kids in gymnastics and travel sports they would still be fine people, except they might have divorced parents. Those types of extras alone cost half of MMM’s entire budget. Sure they aren’t essential, but that isn’t the point. I admire all of you who make it work on <40k a year with a family.
Randy @ Emusements
To bring some levity to the discussion, here is my belated reply to the Suze Orman episode — a blog post by my cat, Milo — “Cat on FIRE”.
https://emusements.com/cat-on-fire
Nate
I was certainly one of those who saw the Orman headline and got roped into the FIRE debate. I think you did a fantastic job of politely explaining and adding some logic to several crazy assertions from Orman. For me, Orman is like the Trump of personal finance and I hope a lot of Suze’s listeners tune to this interview and wake up. Otherwise, they’re “going to burn up alive” with regret for having listened to her.
Sarah R
Thanks for this episode and the interview with Suze.
One note: I think it’s important to be more precise with some of the terminology — Long-Term Care is not Long-Term Disability. LTD insurance is intended to provide maybe 50-70% of your income if you are in the workforce and have to leave it due to illness/injury. Many employers offer this and people can buy private policies, as well. But if you don’t need an earned income from an employer because you didnt need a job anyway, it doesn’t matter that you don’t have a group disability policy through work to step in and provide you with partial replacement income if you can no longer work.
Long-Term CARE, though, is what your description of “not being able to perform activities of daily life” was referring to. Companies rarely offer LTC policies (though some do). Unless you’re at one of those uncommon companies, being in the workforce when you experience an LTC event will not help you. Actually, if your whole household is financially independent, it increases the likelihood that your partner could help care for you — maybe not full-time, but at least enough to defray some of the costs. She could still make the point that people should save up a nest egg whose 4% SWR provides for an income significantly higher than what you’re spending today in anticipation of being obligated to spend significantly more at some future phase in your life, but that isn’t how she phrased it. And just happening to be older when you retire with that same amount of money doesn’t help because being in the workforce doesn’t help you with LTC. Having more money does, but I fail to see how the age at which you accumulate that money has an impact on that.
Mr Mojo Risin
One thing I don’t get it that if AI/robotics create 25% unemployment who’s going to buy the products AI/robotics makes? We’ve heard all this before about automation and what-not. New industries will be created. Capitalism is the process of creative destruction.
FIRE Admirer
I started watching Suze’s CNBC show regularly during the 2008 financial crisis. Most of it was common sense. What struck me was her emphasis to retire at 70 and funding a Roth IRA. Someone earlier posted she was a mouthpiece for the government and I tend to agree. Retiring at 70 gives the Treasury more time to re-stock the Social Security fund and a Roth forces you to pay taxes up front; again to replenish the Treasury.
This was one of her first comments in your podcast that there would be not enough workers to fund SS for the Boomers. As a Boomer myself that thought has occurred to me as well BUT that should not be a concern for the FIRE community.
I retired at 60 and could have retired sooner but was too insecure. I admire the courage of anyone who takes that plunge in their 20s, 30s, 40s and even 50s. I only wish I had found the FIRE community earlier (too busy working) because I have learned a helluva lot more than I ever learned from Suze.
Paula, in Suze’s own words, YOU were Fabulous! She was NOT.
MattyPea
Her complete lack of acknowledgement of why she disappeared for 3 years leads me to distrust much of what she says.
https://youtu.be/wZJh25-sO98
What a huckster!
Thank you Paula for being such a caring and thoughtful professional. Glad to be a new follower of Afford Anything.
Matt
Mtbyogagirl
Did you see Suze respond to FIRE once again in the most recent MONEY magazine? She states “But I now realize “retire early” for FIRE followers is not about stopping work completely as I thought. It is about stopping the work that you don’t like, or just for the money, and finding work that you actually enjoy and that fulfills you. Hello! We are on the same page!” She goes on to say what works for a 25-30 year retirement shouldn’t be assumed for a 50-60 year retirement and encourages FIRE followers to save more in a Roth Or SEP IRA
As a result of the Suze podcast interview I went and read her Women and Money book and learned a great deal. If you can put the emotions and antics aside there is something to learn.
Connie
I listened to the previous episode, it it was okay. It’s clearly a matter of two people from different generational and financial cultures not understanding each other. I blame Paula more for this because she is there interviewer. She should have known her subject better.
However, this follow-up episode is really just opinion and personality bashing. The whole thing just sounds like junior high girls gossiping. “OMG! Did you see what MMM tweeted about her? She’s so out of touch! Ew what a fossil! She doesn’t even go here!”
It was really disappointing. I’ll keep listening to the podcast (and Suze’s; I like both), but this episode really lowered my opinion of Paula.