Photo: Brian Bowen Smith

My first thought as I read Angela Steele's request for financial advice was, "Are you kidding me?" At the age of 27, she has paid off her college loans, saved $12,000 for emergencies, started a retirement fund, earned a sparkling 770 FICO credit score, and—despite earning a modest $30,000 salary—has not a single penny of credit card debt. Make over what? She deserves a gold medal in money management.

Yet when we connected for a phone chat, Angela seemed genuinely distressed. She described herself as at a "financial crossroads," unsure how to reach two important goals: help her nephew pay for college and cover her mother's medical expenses as she ages. "When I look at my goals I don't see myself getting there at the pace I'm going now," she told me. "I need to make some choices and take some risks."

Angela was mulling a job change or new investments to shake things up in her financial life. I presented her with an entirely different challenge.

Angela was raised by a single mother in Phillipsburg, New Jersey. She's obviously smart (she earned an anthropology degree from Stanford University) and also strong and resilient—let's just say meek doesn't earn you the MVP title on your college rugby team. After graduation Angela spent 14 months in China studying hip-hop culture on a prestigious Fulbright scholarship. That is an impressive list of accomplishments! I pointed out to Angela that at her age I was still a waitress earning less than $100 a week.

When Angela told me her number one goal is "to show my family that we can break the cycle of poverty and become truly financially independent," I wanted to send a hug over the phone line. I love that this young woman is thinking about the future. That she's so focused on caring for her loved ones shows she has a big heart. But after we talked some more, I began to worry that the people she's trying to save don't actually need saving. For instance, it turns out the college-bound nephew she wants to help is only 4 years old—and both of his parents are working full-time. As for Mom, well, she's a lively 50 and doesn't have any medical issues that should spark Angela's concern.

While focusing so much on family, Angela has lost sight of her own priorities. "I think you are the obstacle to your own financial freedom," I told her. "You are missing the point that you really matter. You can't save for your mother's medical needs before saving for yourself. You can't fund a nephew's education until you are on your own path to security."

My most important advice to Angela had nothing to do with money: Right now she is stuck in savior mode, and we need her to recognize that the way forward is to take care of herself first.

Illustration: Patrick George/Getty Images

Safeguard Your Health
Angela has renter's insurance and a nonowner's auto insurance policy, but no health insurance. How can you possibly be there for others if even a small health crisis would wipe you out financially? Within two days of our conversation, Angela had applied for an individual health insurance policy. Because she has solid savings and she's young and healthy, I suggested she opt for a policy with a high deductible. She can cover the deductible from savings if necessary and in the meantime save money on a lower annual premium. (You can shop for individual health insurance coverage at

Illustration: Patrick George/Getty Images

Don't Talk Yourself Out of What You're Worth
Angela works for an educational travel company, leading trips to China. While she loves her work, it pays just $2,500 a month, and she is an independent contractor, which means she isn't eligible for most benefits. But she was also quick to tell me that the firm is a small start-up in a tough economy, and she couldn't see how the company could afford to pay her more. Talk about self-sabotage. I explained to Angela that it is not her job to worry about the company's finances. A $30,000 salary is not enough. She knows it, and I know it. But Angela still lacks the courage to ask for what she needs. That has to change. How to ask for a raise.

Illustration: Patrick George/Getty Images

Keep It Simple
Angela asked me what I thought about her investing in a rental property to generate more income. I warned her that for someone so bright this was a plain dumb idea. Real estate is full of risks—renters can be unreliable, repairs and upkeep can be costly—and she doesn't yet have the financial security to make it worthwhile. Building her retirement account, adding to her emergency funds, saving for her own home come first.

Illustration: Patrick George/Getty Images

Give to Your Future Before Giving to Others
Angela told me she is planning to invest in a low-cost Vanguard mutual fund for retirement. (Most Vanguard funds have a $3,000 initial requirement, though some let you start with $1,000.) I pointed out that she has limited herself by focusing on a specific fund company. What she should really be focused on is how to contribute $5,500 a year—the annual maximum for someone under age 50—to a Roth IRA. (The maximum is $6,500 if you are at least 50 years old.)

That means setting aside $458 a month. A tall order for someone with pretax monthly income of $2,500? Sure, but Angela has always heeded Mom's sage advice to "pay myself first." She splits $200 a month between emergency savings and retirement. Her $12,000 in savings could cover eight months of expenses, so I told Angela all $200 should go toward the Roth IRA. I also noticed she spends $150 a month on gifts and donations. I love the sentiment but not the financial hit. Give your attention and time to people and causes that matter; right now that $150 goes toward retirement. For the last $66 she needs each month, we agreed that Angela will negotiate a more respectful salary. If she can't, then it's time to seek other opportunities.

If Angela can save $5,500 a year in a Roth IRA, she could have more than $800,000 by retirement. And she'll likely earn more in the coming years and be able to amass even larger savings. That will not only break her family's cycle of poverty but also give Angela the personal security she needs to step up for them in the future—if they need the help.

Suze Orman is the author of The Money Class: Learn to Create Your New American Dream.