Suze Orman Reveals Her Top 6 Money Mistakes (How Many Have You Made?)

Financial mistakes happen, both small and large, and even trusted financial gurus like Suze Orman make them. Orman is known for her wisdom on wealth building, but it hasn't always been smooth sailing.

The good news is that it's always possible to learn from mistakes, especially when they come from financial experts like herself. Here are some of Orman's own money mistakes she has shared in the past. Hopefully, you can avoid them and build wealth.

Long-term care costs can add up quickly. And although many people will ultimately pay for long-term care, very few have enough on hand to cover the steep bills. That's where long-term care insurance comes into play.

Orman has shared that she missed the chance to buy long-term care insurance for her mother, and it ended up costing her around $25,000 per month to provide for her long-term care needs.

Although she repeatedly expressed her desire to buy a long-term care insurance policy for her mother and cover the premiums, ultimately her mother refused to sign the paperwork, insisting she would never need it.

"If she had simply signed the paperwork, it would have saved me over $1 million," said Orman in an interview with CNN.

When it comes to building a robust stock portfolio, many experts advise a strategy of buying and holding stocks for the long term. But for almost everyone, including Orman, it's incredibly tempting to try to time the market.

Orman has admitted to selling out of stock positions too soon. Instead, she says she should have held onto the stock longer in order to maximize her earnings.

"The biggest mistake I've made was thinking I was smart just because I doubled, tripled or even quadrupled my money, and then selling too soon," she said in an interview with MarketWatch.

She explained that in multiple instances, she sold her stock too early. After selling, she either had to watch the stock continue to soar or buy back in at a higher price point: "If I had just held on from the beginning and continued to dollar-cost average, the gains would have been extraordinary," she said.

If you choose to build wealth through a stock portfolio, consider the tried and true buy-and-hold approach. Many advise against trying to time the market and instead focus on buying into the market over time.

It's easy to pass off your financial management to an advisor. But, unfortunately, not every advisor has your best interests at heart. With that, it's critical to get financially educated in order to avoid mismanagement of your funds.

After Orman received generous tips during her waitressing gig, she had around $50,000 saved up to open her own business. But when she approached a broker, they advised her to invest the funds. Ultimately, the broker lost her money through poor investments.

"The $50,000 eventually became $0. It was a very painful lesson in not being informed, and trusting people to be honest," wrote Orman in a LinkedIn post.

From there, she was determined to get financially educated, which led to an entirely new career. If you aren't sure about the details of money management, getting started with a book from an expert could be a good place to start.

Roth conversions allow you to convert funds you've saved in a pre-tax retirement account into a Roth IRA. Many see this as an opportunity to lower their tax bills in retirement. But Orman missed this opportunity.

"The biggest mistake I have made, in my opinion, with my money is not taking advantage of the one-time conversion that I could've done from my pre-tax into a Roth and just had that money grow," said Orman in an episode of her podcast.

If you'd like to pursue a Roth conversion, consider asking a financial advisor for guidance on the best way to go about doing so.

It's easy to fall into the trap of 'keeping up with the Joneses.' Suze Orman herself has admitted herself that she has spent money on purchases like fancy cars and expensive clothes to impress people.

"I, Suze Orman, took money out of my 401(k) to pay for that pricey Cartier watch," she told Oprah Magazine.

Instead of spending money on impressive purchases, do your best to align your spending with your values. For example, if you value spending time traveling with your family, that might mean driving an older vehicle in order to allocate more of your funds toward travel.

Credit card debt can add up quickly. With notoriously high interest rates and the ability to swipe your card for almost anything, sliding into large amounts of credit card debt can happen to anyone — including Orman herself.

"When I ran through all my money, I started using the bank's: I eventually had more than $60,000 in credit card debt," said Orman in an interview with Oprah Magazine.

If you have a credit card in your wallet, do your best to use it responsibly. That means only spending what you can afford to pay off each month to avoid interest charges.

Suze Orman, like so many others, has made some money mistakes along the way. But she didn't let a single money mistake stop her from building a bright financial future.

Even if you've made a financial mistake in the past, don't let it stop you from taking the next step toward getting ahead financially.