Unless you’re living under a rock, you’ve heard about Suze Orman’s interview on Afford Anything, unloading about the FIRE community. She delivered this unloading in an abrasive way likely planned to trigger all of the internet to start writing about her. Mission accomplished!
I can’t write as eloquently as the numerous rebuttals posted by Mr Money Mustache, Early Retirement Dude, or Chief Mom Officer. Instead, I am going focus on the real-life absurdity that likely drives Suze’s belief that you can’t retire on $80,000/year. Why does Suze have this belief? I think she’s been earning a significant income for the last 20+ years, such a significant income she is well into the top 1% of income earners and has been living in that 1% bubble for too long. In this interview she quoted a number of expenses most people would consider lavish, such as private elementary/high school and the cost of going to Harvard. These are not the expenses of the Financial Independence movement!
I specifically take issue with this because $2mil is enough to retire early. Its enough to retire early if you can live outside of Suze’s bubble of “normal” expenses. She also quoted black swan events, but as Paula pointed out in her follow up episode, those are risk events and we should talk about risk mitigation strategies instead of yelling “No!” at the idea. Sorry Suze, I have zero desire to slave away as a corporate drone and FIRE will give me the freedom to figure out what else I want to do. Risk mitigation? Sign me up. Working 30+ more years at an uninspiring job? No thank you.
The 1% Bubble
What does the 1% (or really top 5%) bubble look like? I happen to live in one of these top income areas. This is an in-town area of a major city in the US. I wanted to be close to the office and we bought a 1950s house in a neighborhood where most original houses have been bulldozed over and the replacement property costs 3x-4x the house torn down. Neighbors in these recently replaced houses include physicians, lawyers, finance professionals, and a current pro athlete.
I did not grow up in one of these bubbles, but instead grew up in a low income household (no Poverty Olympics here) and what’s considered “normal” in this bubble fascinate me. The baseline lifestyle for some of these families has to be $150,000, $200,000, or more. If Suze has been living in this bubble, its no wonder she thinks retiring on $80,000/year is impossible.
The following are observations of what is considered “normal” in this small bubble of humanity:
Personal Shoppers/Stylists/Designers: One of our neighbors fat-fingered their address and we were getting 1-2 packages per week from some fairly expensive retailers. Another neighbor brags about “affordable” personal shopping at *only* spending $1,500 for 3-4 outfits. People hire interior designers to tell them how to decorate a house.
Private School, along with campaign style yard signs that brag about which private school their child goes to. These easily run between $25,000 and $35,000, most of which are in such high demand they aptitude test their children before admitting them into kindergarten. I guess when you go through that effort and spend that much, you must brag about what private school your child goes to.
Fancy Cars: The typical brands include Land Rover, Maserati, Tesla, and Porsche, with a few BMWs and Lexus mixed in. (our 12 and 18 year old cars are out of place). We are often the ONLY non-luxury car at a stoplight or our local grocery store parking lot.
Property Taxes: In-town living is expensive, especially in a state that funds is budget through property taxes in lieu of income taxes. Houses in our block cost between $15,000 and $50,000 per year just for the privilege of ownership. If you want a big house and live close to employment, that comes at a cost.
Gym/Spin/Barre Memberships: We have multiple full-service gyms around us that run $250/mo. Some of the niche, single class offering Yoga/Spin/Barre studios that run well past $150/mo. They’re always full!! We have to drive outside of our bubble to the “normal” gym and even the local not for profit YMCA runs nearly $100/person.
Pools: Most of the houses have a pool, but very few people actually maintain their own pool. After someone pays the $30,000 to $100,000 to put one in, they then hire a pool service running around $2,400/year.
Yard Service: There are a few people who work on their own lawn, but the majority of the houses have weekly yard service and the lowest cost of which is known as the “mow and blow” for between $50-$100/week for 10 months out of the year. Yard service is so common here, the real estate agent who was on the seller’s side of the transaction asked my wife if she was “yard help” a month after closing. (note: money can’t buy intelligence)
The Plant Concierge: One of our neighbors has a giant box truck pull up to their house three or more times a year to fully change out all the landscaping. Its October, so the winter landscaping just arrived including large pumpkin deliveries It looks nice, but I can’t imagine the cost of a crew of five plus the actual plants.
Laundry Drop-Off and Pickup Service: There are small vans that drive through our neighborhood picking up people’s bags of laundry, returning it to them in the evening.
Prepared Food To Go: Every single strip center has some sort of meals to go option. You can easily spend $50+ every night for dinner and still have to heat/serve it in your own house.
Police Patrol: The neighbors decided petty theft and speeding was an issue. The primary issue was cars being broken into when someone’s garage was too packed with crap they don’t need to park inside. What is the solution? Go door to door raising money for a private police patrol. Each house is expected to kick in $425/year. Now whenever something “bad” happens in our neighborhood, there’s a contingent saying “that’s why we need to pay more for more hours of patrol”.
Poop Pickup Services: One of the most entertaining threads on NextDoor recently was when someone’s “dog poop pickup” person had moved on to other work. There were some jokes and some people were surprised this was a thing, but out of this thread came THREE OTHER RECOMMENDED COMPANIES! I was really tempted to recommend myself and go over there myself with two plastic grocery bags and do it. Unless their dog is the size of a T-Rex, that sounds like easy money.

Country Clubs: This is the land of the country club, from the elite of the elite clubs costing $100,000 – $350,000 to enter (plus monthly dues) to “blue collar” country clubs costing $400/mo, it is the social norm to be a member. People ask “where are you a member” when making social/professional conversation. Dues are just the start, how could you go without golf lessons, swimming lessons, bar tabs, and exceeding your food minimum? Oh Suze, what should I do!?
Note: I am a full believer in using money to buy back time. Choosing one, two, or even three of these may be an effective use of your money. This is not a judgement on any of these expenses individually, but to point out if someone uses ALL of these services, retirement is impossible on $80,000/year without significant lifestyle changes.
So what does this all mean?
I think Suze’s response is no different than the average friend who says “I could *never* do that” when they ask “how did you retire”. She just doesn’t get what reasonable expenses can be. This is exactly what the FIRE movement is about, think differently to get away from the rat race!
Nice one! Totally agree she’s stuck in her bubble.
Good lord, I knew high income people were extra spendy, but this list is overwhelming. What a sad way to go through life: working non-stop so you can pay for all of that waste. At least the people providing those services are probably earning a good living…
There’s absolutely a good living providing these services and fortunately this metro area has affordable housing a short distance away. If we wanted to stay in this house, I think we could make $40k with our eyes closed just by picking up dog sitting and random work off Nextdoor. One of my employees is leaving to go to grad school full time and her network is throwing “help me do X” money at her.
I think the bubble is why Warren Buffett prefers to stay in a small town so he can focus on his investing philosophy and quiet the noise. Similarly, if you’re surrounded by people who get all their meals delivered (you forgot to add meal kits to your list of extravagances!) then that and other lavish spending will soon seem normal. I see it in my high-cost city, New York, all the time. Prices are so inflated and there are so many of these convenience services that it can seem like a “normal” thing. We look forward to being able to spend more time in slower-paced locales, like Costa Rica, where we can live Pura Vida.
I thought this was on display this weekend. Buffett was sitting in the middle of a stadium for a title fight in Omaha Nebraska. Not on the front row, barely noticed by the media
Suze is definitely in the top 0.01%, and that has got to impact her views somewhat on what people need and what is normal. However I also think there was some nuance in her comments that has gone overlooked. I don’t think she or anyone would say that no one can live on $80K a year (with a median national household income in the mid $50ks, that is clearly ridiculous). She didn’t even say that no one should retire with $2M and therefore an expected income of $80K. She specifically said that someone who retires at 70 even with less than that should be fine.
What she was scoffing at is the idea of “25 to 30 year olds” who retire with “$500k or $1M” and think that they can live on 4% of that amount (whatever the amount is) for the rest of their lives. Funding a 15-30 year retirement purely with portfolio income is vastly different than funding a potentially 60-70 year retirement. The odds of encountering a major event – natural disaster, war, depression, family crisis, disability, etc – ARE much higher if you’re looking at a 6-7 decade period of time versus 2-3. Returns and taxes and inflation are harder to predict over those lengths. More to the point, your goals simply may change. Maybe you decide to have kids or care for an aging parent or get divorced or remarried which could radically change the budget (even if Harvard and a first tier nursing home aren’t in the cards).
FIRE bloggers of course jump in with the only defense they have against those concerns – that most FIRE folks actually work in “retirement!” It’s just that we like the option to not HAVE to work! I find this hugely ironic – and misleading. Sure, the FIRE bloggers we all know make huge money off their passion projects – that’s why we’ve all heard of their blogs. But most bloggers (and writers and volunteers and travelers) don’t. And FIRE is supposed to be about actually being able to call it quits if you want to, i.e. actually being able to live off your portfolio – not being forced to work part time or launch a new career as a FIRE blogger to make ends meet. So you can’t exactly blame ppl like Suze and others for pointing out that FIRE as it’s advertised just might not work out for the average Jane or Joe.
I was impressed with Suze’s response yesterday. I think the “retire early” part really put her off as someone coming right off not being able to retire. FIRE to me is about having the safety net to do whatever I want. I’m sure some of those hobbies will make money.
I think it’s hard to live on $80K a year. I spend about 15k on my truck (Ford f150) .
But it depends.
I’m leaving in a village (small town) there the cost of living is not so hight.
thanks for post!
Hi SIS,
Some of my favourite services to gawp at during my years in a HCOL neighbourhood were the oven cleaners — separate to the house cleaners, they came by SOLELY to clean the oven –, the bin cleaners, who followed the garbage trucks and hosed out the trash cans of the people paying for their services, and of course the ‘car detailing’ service, who would come to the house to clean the car’s interior. Of course tons of window cleaning crews cruised the neighbourhoods, but that didn’t seem as strange to me. I pretty much assumed everyone outside in a yard was hired help, and every young woman with a child was the nanny.