Suze Orman Doesn't Want to Hear 'I Can't' When It Comes to This Investing Advice. Here's Why She's Right

One thing many people don't know about financial expert Suze Orman is that she wasn't always wealthy. In fact, there was a time when Orman actually had to live out of her car due to a lack of money.

As such, Orman is sympathetic to the fact that not everyone is a high earner. And she understands that carving out money for savings, whether it's for emergencies or retirement, isn't easy.

But Orman also knows that people who don't save adequately for retirement risk ending up cash-strapped once their careers wrap up. And that's why she doesn't like to hear people say they can't afford to fund an IRA or 401(k) for the future.

An important goal to prioritize

If you're only a modest wage earner, it's easy to see why you might struggle to sock a lot of money away each year for retirement. After all, how are you supposed to focus on such a far-off milestone when you have bills to pay and credit card balances to chip away at now?

The problem, though, is that if you don't save for retirement, you might spend the latter part of your life unhappy and teetering on the edge of poverty. It's that simple. And it's that fate Orman doesn't want anyone to have.

Now a lot of people have their reasons for not prioritizing their retirement savings. In some cases, those reasons are quite legitimate. But even so, Orman doesn't like to hear about how people can't afford to fund a retirement plan because that's such a necessary thing to do in her mind.

In fact, in a recent Tweet, Orman said, "At a minimum, you want to save 10% of your salary in your #401k. If you're not yet at 10%, boost your contribution rate by at least 1 percentage point right now. Don't tell me you can't afford it. You can't afford not to do this."

She's totally right. If you neglect your long-term savings and are forced to live only or mostly on Social Security in retirement, you might end up struggling. That's because those benefits will only replace about 40% of your pre-retirement wages if you earn an average salary. And that 40% figure doesn't account for benefit cuts, which are a strong possibility at this point.

Now, take a look at your expenses and imagine covering them all with a 60% pay cut. It's probably not doable. And that's exactly why you have to make an effort to save for retirement.

Small boosts could go a long way

You may not be able to save 10% or more of your income for retirement now. If that's the case, save 2% this year if that's all you can swing, and next year, make it 3%, and so forth.

What's equally important is starting to save for retirement at a young age. Let's say you manage to stick $1,000 into your 401(k) or IRA at age 25. If you invest your savings in the stock market, you might generate a 10% average annual return on your money, which is in line with the market's typical performance over the past 50 years as measured by the S&P 500 index. By age 65, that $1,000 will be worth around $45,000.

Now $45,000 isn't enough for most people to retire on. The point, however, is that the sooner you make an effort to save for retirement, the more opportunity you'll have to grow wealth. And the more you're able to save, the more financial freedom you're apt to enjoy during your senior years.