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Suze Orman Loses Her Sh*t on Twitter

by on January 12, 2012

Suze Orman cracked under criticism after an onslaught of disparaging reviews of her new prepaid debit card, lashing out at reporters and bloggers in a series of embarrassing tweets. Here are a few examples:

In response to a young lady who tweeted a less-than-flattering review by trusted financial blogger Philip Taylor of PT Money:

@20andengaged Too bad you choose to believe an idiot over me- you just keep following others and see where it gets you

In response to a tweet containing a Fox Business interview with John Ulzheimer of SmartCredit.com:

@scrpbks4u read the great reviews of legit reporters or ones that are smart enough to understand what I am doing. There are many Suze haters

In response to a tweet from YourMoneyDrawer expressing disappointment in Orman’s decision to roll out a prepaid debit card:

@YourMoneyDrawer @ptmoney if you want to think that you can. But ignorance as to the big picture here says more about you than me.

In response to a sympathetic tweet from a supporter (in reference to a lot of intelligent, informed finance experts):

@Audrey00211 dont worry Aud. I can take it. I am use to people who know nothing think they know everything. You just have to pity them

The evil within

What are finance experts saying that so ruffled Orman’s fiscal feathers? That her card sucks. Which it does.

It’s not that Orman’s “Approved Card” is more costly or fee-heavy than other prepaid debit card—actually, it’s a lot better than most cards of its class. The problem dwells deep within the prepaid system itself.

Prepaid debit targets folks with no or low credit, people without bank or credit card access. Laden with fees, you’re likely to pay more for a prepaid debit card than you would many high-end credit cards. But here’s the really awful part: prepaid debit does not help build your credit score. Even if you’re spending responsibly, prepaid will never pave the way to better options.

Orman knows this well. In The Money Book for the Young, Fabulous & Broke (2005), Orman writes:

“I don’t think prepaid cards are a viable option, either, since they also aren’t going to help you build a reputation at the credit bureaus. If you can’t get a regular credit card, you are to get yourself a secured card and use it as a stepping stone to a credit card.”

And just recently, she received the following inquiry on Twitter:

@SuzeOrmanShow Hi Ms. Orman my question is prepaid better than a secured credit card from a credit union?

To which she responded:

@AYIRASOuL If you are currently looking to increase your FICO score right now a secure card is the way to go- you should stick with the CU

Orman suffers no delusions here. She knows prepaid debit is the pits. She knows secured is the only viable option for abysmal credit. The Approved Card will cost holders a minimum of $36 a year — higher than the annual fees of our go-to secured credit cards. But if you utilize additional services, fees can easily escalate to over a hundred bucks a year.

Why the hypocrisy? Money, of course. Releasing a prepaid debit card is very profitable. Kim Kardashian had her own for a while, and Lil Wayne just introduced the “Young Money Card.” Any reasonable mind would be a tad skeptical of financial advice from Kim or Wayne. Orman, however, has a lot of sway over how people spend. It’s sad to see a trusted finance guru compromise her beliefs for quick a buck. We’re guessing the backlash will be so damaging that Orman will abandon the scheme before long.

Worth a nod is Orman’s “Credit Project,” an effort to persuade credit bureaus to factor prepaid debit into credit reports and scores. She aims to report prepaid account activity to TransUnion in hopes of establishing a correlation between responsible prepaid debit use and credit card habits. Orman hopes to convince bureaus that prepaid debit can be used as an indicator of creditworthiness and should thus influence credit scores. Of course, it will take years for TransUnion to come to a definitive conclusion, and credit scores will remain unaffected by prepaid debit for the foreseeable future. The Credit Project has been denounced by some as mere “marketing fluff,” which it very well may be. We’d be more impressed with Orman’s endeavors if they didn’t involve profit margins.

All apologies

After Orman (or her PR team) realized the potential detriment of her hostile tweets, Orman tried to make things right with a rapid-fire series of rueful apologies:

For anyone I called an idiot I too am sorry. I should have known better. That never should have happened so again I admit that I was wrong

@ronlieber Ron- I would never insult YOU- you are a great reporter and I admire the piece that you did- it was honest and thorough! Sorry

@MJTM @PTmoney Even you PT– I am sorry I admit that i was wrong.

@ptmoney @mjtm Thank you and again I am very very sorry

@kevinmeyers @ronlieber I have to tell you I dont blame you- I did not take the high road here and my bad– just so you know.

@kevinmeyers Thank you I admit I am not good at defending my self against things that are not true. It got to me. Wont happen again

Now that Orman has apologized to her critics, she need only apologize to her fans by retracting the Approved Card and resuming her former stance on prepaid debit.

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  • Brad Burnett

    Great article. Suze’s actions are loathsome. You said it perfectly. If her sudden shift in her “beliefs” weren’t profit driven, even though they are against all she has attempted to preach for years, I would cut her a little more slack. She has now exposed herself for what she really is.

  • mikes

    I don’t think I’ve ever heard Suze profess any advice that a 15 year old shouldn’t already know. It’s not her fault that there is such a huge “market” for very basic financial knowlegde, but her “better than thou” attitude is a joke.

    As far as this goes: if she was doing the “credit project” without the card I’d say it was a laudable (but still mislead) attempt to help people. Obviously not though. I bet she’ll shortly announce that she was planning to donate her share of the profits all along.

    And… I not a twitter(er?) but is grammar and punctuation not desired, even from someone who’s self branding is as a source of knowledge?

  • http://www.joetaxpayer.com JoeTaxpayer

    Early on in my blogging, I wrote a few negative things about Suze, and a reader who stuck with me all these years emailed me and offered great advice. That criticism and name calling was no way to gain the audience I was looking to build. I was appalled to see Suze tweeting as she did. I know Phil (PT) and met him in person. To call him an idiot says more about the writer than it does about Phil. He offered an honest review, helpful to his readers, and Suze went nuclear.

    Apology aside, I find no value in the product. If somehow this card helped one’s score, that would be its benefit, but it can’t do that. Her disclosure states that this is an experiment. She’ll share data and ask Transunion if they can do anything with it. As a numbers guy, I respect the concept, but it’s an experiment that will cost the user $3/mo to participate in. No thanks.

  • http://www.compoundingreturns.com/ Pat S

    Dont get behind something you can’t justify, Suze…

  • http://www.compoundingreturns.com/ Pat S

    Dont get behind something you can’t justify, Suze…

  • Pingback: Russell Simmons Vs. Suze Orman: FIGHT!

  • End Wage Slavery

    What I don’t like about Suze Orman is that she is completely unrealistic on meta issues regardless of what she might have to say about individual finances.

    Her advice to people who don’t like slaving away for an exploitative wage? Become your own boss! Great idea! Why didn’t they think of that? Maybe because your average wage slave doesn’t have $5 left over after paying his bills for the month let alone enough money to start their own business? Maybe because a wage slave is highly unlikely to get approved for a small business loan?

    It’s like she sees what a massive pile of crap capitalism is, how it is more one-sided than a Moscow show trial in the ’30s and how it can’t survive without taking advantage of the vast majority of people but yet she still can’t bring herself to advocate raising the minimum wage to make it a living wage or something radical but necessary like transferring the ownership of businesses into the hands of their workers which would truly be the only option if we want to put an end to the exploitation of the average worker. She can’t bring herself to rip off the band-aid all at once and instead offers idiotic non-solutions that don’t bear any relation to everyday reality because offering such solutions doesn’t threaten the capitalist status quo. Get some guts Suze! Capitalism is a spectacular failure for the average person. You already realize it. Now come out and say it and offer some real solutions.

    • Wage Slavery Rules

      Wage slavery….you made your bed, now you get to sleep in it.

  • http://www.facebook.com/justin.david.thad Justin David Goujon

    Here’s the thing – nothing is perfect for anyone. I have a high fico score and credit cards with high limits etc etc.. but I like using my Suze card. It helps me think about spending. For me its worth the $3 bucks a month to have a budgeting tool that texts me each time I spend money. I still have a Bank account and a credit union account on top of it. I know not everyone likes Suze, but I think her product is a fair prepaid card for unbanked people.