Suze Orman: How Startup Founders Can Cope with Financial Stress

Soon after graduating from college with thousands of dollars in debt, Will Peng turned to Suze Orman’s bestseller “The Money Book for the Young, Fabulous & Broke” for advice about saving and becoming debt-free. Years later as the co-founder and CEO of Northstar, Will got the chance to interview Suze about how personal and professional financial health are inexorably intertwined.

Both Will and Suze understand how the money worries, endless workdays, and sales woes that plague startups can pose mental and physical challenges for entrepreneurs. All of this stress can weigh on employees who are trying to maximize their performance and productivity.

When I met Will through the PeopleTech Partners accelerator, I was impressed with how he and his co-founder Matt Matteson had identified this critical problem that so many employees face: constant financial stress and uncertainty, which can negatively impact their performance. The genius of this product comes from finding an intuitive and integrated approach to helping both companies and employees address these challenges.

Now with M13 as an investor and as a board member for Northstar, I’m thrilled to see Will connect with America’s personal finance expert over their shared mission to promote and democratize financial wellness.

Here are some highlights from Will’s fireside chat with Suze:

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What does financial wellness mean to you?

You have to first ask, “What is the goal of money?”

The goal of money is for you to be secure. So financial wellness would mean that you have security. Now, what does that mean? It doesn't necessarily mean that you have all this money, but it means that you have power over the money that you have, how you think about it, how you invest it, how you feel about it.

You have to understand that money is a physical manifestation of who you are because money by itself can't do anything without you. So if your money is a financial chaotic mess, that means you are a mess because your self-worth equals your net worth. So you can't ever divide the two. You can't put your money over here and who you are over here. You are one. You have to have both of your feet in one boat going the same place. Your professional life, your personal life, your financial life all of it has to be one.

I believe from the bottom of my heart that you can never fix a financial problem with money. Personal finance means it is personal.

You can only fix a financial problem when you really fix what's going on with you.

Suze Orman

What advice do you have for people who are stressed out by money problems, like the ones created by the global pandemic?

There are three internal obstacles to wealth:

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So let's talk about the biggest one right now that this last year created: fear. Everybody is afraid. There's only one way to conquer fear action.

Hey, you can't pay your bills. Pick up the phone, and let your lenders know you can't. Just face it. I always say you have to face it to erase it. When you're not opening your bills, you're not making those calls, you're just dwelling in fear. You're rendering yourself powerless. When you’re rendering yourself powerless, you are then repelling people because power attracts people, and people control money.

How can an employer help support its employees’ financial well-being?

An employer always has to make sure that they're doing what's best for the employee … because it's very confusing as you know. Do you do an HSA, or do you do a PPO? It's all so complicated. So employees Joe or Jane ask their other friends, and they all are making the exact same mistakes.

And so the employer has a big responsibility for providing things to their employee that can help them, which is why one of the projects that I'm working on is an emergency savings account within an employer that would match the contribution Unheard of because all people ever do is match a 401(k). But the problem is, well, people are afraid now to put money into a 401(k) plan, because if they need it, they can't necessarily get it out. So with this new company that we've created called Secure Save, your employer can match the contribution if they want; you can access your money anytime you want. And so this is a whole new thing.

What are some of the best ways to support family or friends who are struggling financially?

The thousands of emails that I'm getting now say, “Suze, the reason that I made it through is because I did what you told me to do. I had an eight-month emergency fund.” And by the way, I've now raised it to 12 months.

If you have money, things are great for you, you didn't lose your job, and you have a stimulus check coming in and don't need it, then you have to be generous. Instead of taking that money and putting it in your emergency fund, that is money that you should give to somebody—not lend. You never lend it, but give it to somebody who's really suffering and they need you.

You have to have honest conversations. Sometimes the honest truth is “I wish I could help you, but I cannot.” Most of us get in trouble because we help and we help, especially the women out there. Then you need, and there's nobody to give back to you. Now you're in serious trouble. You just have to be honest and stand in your truth.

‍Get more perspectives on the business and principles of wellness from Arianna Huffington, LL Cool J, Adam Grant, and other prominent leaders at M13’s Future Perfect virtual event‍
You can also tune into Suze Orman’s Women & Money (and the Men Smart Enough to Listen) podcast on your favorite streaming app or learn more about Northstar, a M13 portfolio company.‍

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