CHICAGO -- Suze Orman's financial pep talks carry consistent themes: Attack your debt. Have a plan for retirement. Take control of your money.
But Orman hasn't remained the nation's best-known purveyor of personal finance advice by sticking to the same script through boom and bust.
Yes, it's the South Side of Chicago native's powerful, empathetic delivery, often accompanied by a wagging finger, that makes her persuasive. And multitudes keep tuning in to her CNBC-TV show and buying her books because of her knack for talking people through the changes in the economy.
That means sometimes revising her advice on the fly. She preaches much more caution than she used to, for example, when it comes to taking out student loans for pricey tuition.
Orman has a more pessimistic outlook for the economy than many of her peers. "We're still four to five years away from any semblance of recovery, in terms of jobs and everything really coming back," she said in a recent interview with The Associated Press.
So how does that affect her advice for the coming year? Here are five things Orman says you should know about your money for 2011 but probably don't:
--Dividend-paying stocks are the way to go.
Orman: If you are investing, and you should be investing, you need to understand that in 2011 most likely bonds are over. You're better off in good, quality stocks that pay high dividend yields -- 4, 5, 6 percent -- where the dividends are safe and secure and apt to go up rather than be eliminated.
If you don't know which stocks to purchase, you might want to look for a good exchange-traded fund that pays a nice dividend yield.
Investors need to be in stocks that pay good dividends, regardless of what happens with tax brackets. That is a switch for me. From 2007 all the way up until now I have been "bonds, bonds, bonds."
--A Roth IRA can be used as an emergency fund.
Individuals don't get a tax deduction for contributions to a Roth individual retirement account, but the money grows tax-free and they can withdraw any portion of the account after age 59 1/2.
Orman: With a Roth IRA, you can withdraw your original contributions any time you want. That's regardless of age or how long that money has been in there, and without taxes or a penalty. So especially in 2011, when saving for your own retirement and having an emergency fund is of the utmost importance, here's a way for you to have both in one.
If you need money, the best place to get it if you have an emergency would be from a Roth IRA if you have no other money. If there's extra money, you can set up a separate emergency fund. But if you only have a limited amount of money, why not just set up a Roth IRA?
--Credit cards issued by credit unions can be much less expensive.
Orman: By law, federally chartered credit unions cannot raise your interest rate above 18 percent. Compare that to the 30 percent of Citibank and all these other banks. Also, most credit unions allow you to transfer credit card balances for free. Credit unions do all kinds of things that make sense. So get yourself a card and do a balance transfer.
One of the best places to find a credit union card is at a website called www.creditcardconnection.org. Everyone should have a credit card at a credit union.
--Term life insurance can save families with private student loans from financial ruin.
Orman: If parents have a private student loan that they co-signed for a child, or are about to co-sign, they'd better also get a term life insurance policy insuring the child for the amount of the loan. Because if your child dies, you will owe the amount of money that you co-signed for.
It's not expensive to get a $100,000 term life insurance policy for your child. It will cost maybe $5 a month. But if you borrowed $100,000 to send your kid to school and your child dies, you could be responsible for the $1,000- a-month payments for 20 years.
--Trial mortgage modifications can be a trap.
During a trial mortgage modification, borrowers facing possible foreclosure can have their payments temporarily lowered while the lender evaluates their hardship, and whether they qualify for a permanent loan restructuring.
Orman: If you are doing a trial home-loan modification and you are denied, you will owe the bank the difference between what your full mortgage payment should have been and the trial amount. If you can't pay them back, they will start foreclosure proceedings immediately.
Say you owe more on your home than it's worth, and you are on a trial modification. You owe $2,500 a month but the bank has been letting you pay $1,500. You'd better be very, very careful, because if you are denied a permanent home-loan modification, you will owe back that $1,000 a month difference for every month of the trial.