← Borrowed Future
Borrowed Future
Ep 8: Own Your Future: A Life Without Student Loan Debt
00:58:02
In this must-listen season finale, we take a look at practical things students can do to graduate from college debt free. You’ll hear the surprising truth about how working through college affects your grades, how budgeting can improve your college expe
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- [00:02]
A
The way to get the most out of college is not just classroom focused. Now you've got to win in the classroom. You got to show up, you got to dive in, and you need to learn what you're being taught. And obviously we'd like to see you get a really nice grade as well. But that's only half of the winning equation when you're in college.
- [00:20]
B
If you're a high schooler and you're about to start your college journey, make sure you have some standards with your finances, that you're going to stay away from credit card debt, that you're going to work, that you're going to be on a budget and you're going to make the money that you have make it through school. Make sure you got your moral system in place, that you have a set of morals and values that you're going to live by, regardless of peer pressure, regardless of craziness, so you don't mess up your life during the next four years.
- [00:52]
C
From Ramsey Network, I'm George Camel and this is Borrowed Future, a podcast series exploring the $1.6 trillion student loan debt crisis and the impact it's having on. In this final episode, we'll walk through how to make it through college without taking on any debt and wrap up our series on the student loan debt crisis. Here's Anthony o', Neill, author of the bestselling book Debt Free Degree.
- [01:17]
D
While you're in school, you have to work, save and behave. You're gonna go to class, you're gonna live on a budget while you're in school and you're gonna stay out of trouble. You can lose scholarships by posting the wrong thing on your social media page. You can lose scholarships and gr. Dumb decision on campus. You're going to work. I recommend that the average young person works in between 10 to 19 hours max, 20 hours a week. If you work more than that, make sure that it is not getting in the way of your education because remember, our education is our priority right now. You're going to look for ways you can save. You don't have to have the unlimited meal plan, especially if you know you may eat at your job or you may be going home. If you're in state and eating at home, you're going to look for ways you can save out on campus. Maybe it's not living on a dorm, maybe it is spending another four years at home so you can save on that. Look for ways you can save money in college. And just make sure you guys, you are behaving when you walk onto the college campus. You're a young man or woman with character and integrity. You gotta work, save and behave.
- [02:33]
C
It may come as a surprise, but students who work during school don't see a negative impact on their grades. Brad Barnett, financial aid director at James Madison University, explains this phenomenon.
- [02:45]
A
The data is out there about students who work through college and students who don't, right? And I think if you go out and read the stuff, you'll see that statistically speaking, students who work, you know, that 10 to 20 hour range tend to have better GPAs and do better academically than the students who don't. And I think that's true in my own experience and just what I've seen. And the reason is you have an 18 year old who has a very structured life and then they go to a college campus and they go to class a few times a week. You've got an enormous amount of time on your hands. Some students do not adapt well to that lack of structure, especially if they're coming from a very structured environment. The students who I talk to who are working and going to class and doing their homework, it's enough to keep them moving from point A to point B that the idle hands and the idle time don't create a problem. Now, with that said, that doesn't mean that is the law for everyone. There are also students who just can't handle the work and the academics and they will focus all their time on academics and work would become a distraction. So when I talk to students and parents, I go through the general, it's usually better and this is why it's better. But this is where you need to sit down and have a conversation and understand each other about can I handle it, do I need it, or if nothing else, how am I going to handle my spending money? My boys, they know when they go to school, I don't give them a dime during the school year. And it's not because I'm being mean, it's you need to work. We got the big bill. Anything else you want while you're at school, that's on you, you know, that's your responsibility. I also know that working will help keep them on track, statistically speaking, but also it's their pocket money. So I think working for most students is advantageous and helps them out academically.
- [04:32]
C
So we now know working in college has lots of benefits, from learning time management to a higher grade point average. But what kind of job should you get and where do you find it? According to Anthony, you don't have to go too far.
- [04:45]
D
If you need some spending money while you're in college, this is what I want you to do. I want you to get a job. And not just a job. Maybe look at a job you could do on your school. For an example, you could be a ra. A RA is a residential assistant. And sometimes the majority of schools will cover your food, housing, housing and portion of your tuition for being a good ra. But if you need some extra money, look at some ways you can work on campus. For an example, I know a young kid, he handled the school's social media account. And his first year he got about 25% off. Then his second year he got about 50% off. Then his third and fourth year he got 75% off. So while no, that wasn't actual cash money in his hands, it saved him nearly $20,000. Now I some of y' all are saying $20,000 over four years is not a lot of money, but yes it is to a 19 year old who is going to a very nice school.
- [05:43]
C
If you think working during college is impossible, meet Seth. Even with his dad cash flowing his tuition and fees, Seth worked his tail off while passing his classes and graduating on time. There was a conversation that you had with your dad in regards to how you were going to pay for school. Walk us through that.
- [06:03]
A
My father agreed to cash flow a majority of the college bill under three conditions. That I would one, pick a major that was worth getting in the marketplace, that had a good return on investment. Two, that I would go to all of my classes. I would pass all of those classes and graduate within four years. And then I would be responsible for the parking, the textbooks, any of the ancillary things that go along with college.
- [06:34]
C
How did you pay for those? And what were some ways you were able to cut costs and cash flow? All of that.
- [06:39]
A
I was working in two different jobs at the time. One as a pharmacy technician at a Walgreens and one as a caregiver at a local facility where we would offer elderly patients care throughout the night. And the second job was really beneficial to my college schedule. I was able to work night shifts and go to class during the day and then go back to work at night. And I was able to work 40 to 50, sometimes upwards of 60 hours a week to pay for those things that my parents would not cover.
- [07:16]
C
So let me get this straight. You are going to college full time and you're working 40, 50, sometimes 60 hours a week on top of that? Did anyone think you were crazy? Were you going crazy?
- [07:31]
A
My Parents actually did think I was crazy. They my mom was very worried that I would fail one of my classes or not go to school or go to class. What I did, I went to every class and I passed all of those classes. And through all of that, I was able to get engaged to my girlfriend at the time and now my wife. So I had a social life. It was just on the weekends and the hours that we could make it work. But school and work took up a majority of the time.
- [07:59]
C
I want to know the connection to the sacrifices you made in college and how those set you up for success after graduation.
- [08:06]
A
I believe that working hard during those four years and graduating on time or even early if you can, and really focusing all of your attention and energy to the schooling and to the coursework and being that focused for three to four years, I believe it builds a certain character and work ethic because you have an experience of working hard and working diligently.
- [08:30]
C
So you gave up a social life, the campus life, fraternities, traditional college experience. Did you ever feel that fear of missing out that fomo?
- [08:39]
A
I do not have a traditional sense of fomo. Yeah, there were a lot of my friends that wanted to party and have fun. But no, I don't miss or regret not being in a fraternity or going to the college parties or spending an exorbitant amount of money on things that don't have value anymore.
- [08:59]
C
Way to go, 26 years old. You've got wisdom beyond your years. You are crushing it in your field. And you didn't go to an Ivy League school and you walked away without a penny in student loan debt.
- [09:09]
A
Yes, sir.
- [09:09]
C
How does that feel?
- [09:10]
A
Oh, it feels amazing. My wife and I don't have that crushing burden of student loan debt. And like I said, I probably annoy my father with it because I thank him as often as I can. Every time I think about it, I get a little emotional because I don't have that burden and that chain of student loan debt hanging around my neck like an anchor.
- [09:32]
C
Seth may be on the extreme side when it comes to working in college. And while those extremes are doable, you don't have to work 40 or 50 hours a week to make it through college debt free. But Anthony does recommend working up to 20 hours a week to help cash flow your college journey. Having a work ethic in college doesn't just apply to your job. It's also important when looking for financial aid and scholarships. Here's Anthony.
- [09:57]
D
You need to be looking for scholarships and grants every single year. You are in School, even into your master's and doctor's programs. I met a single mother who wanted to go back to school and finish her bachelor's degree. She only had her associate's degree, and because she was a single mother, she actually qualified for a lot of scholarships. And it paid for. She was 35, 40 years old, and she was able to qualify for scholarships because here's the thing, she was looking. Listen, if you do not look for scholarships, you will not get any scholarships. If you look, you will find, when you find, and if you apply, you may get some. You will not get all. But the ones that you land could be anywhere from 500 to 5,000 to 25,000. You never know. But every single day, I recommend our young people spend at least one hour online looking up grants, looking up scholarships, and spend time looking at your local businesses around the community. They have a lot of scholarship opportunities. Hey, we'll give you $500. We'll give you $1,000 just to write this essay or tell us why you like our restaurant. Get very creative. Do not frown upon the $500. Sch. You have to look at it like, I need this, and I promise you, it will. Bless you.
- [11:18]
C
Getting a job and getting scholarships is awesome, But Anthony knows that money can slip like sand through your fingers if you're not intentional about managing it.
- [11:27]
D
Here's the number one thing you need to stay away from when it comes to college, when it comes to saving in college, and that is credit cards. Just earlier today, I got a text message from a friend of mine saying, man, I'm on this campus and I am taking my daughter to school, and already she's been offered three credit card applications. Listen, you guys, a lot of people, a lot of banks, a lot of opportunities are going to come up for you all to apply for a credit card. I fell for that trap. I fell for that. Hey, fill out this credit card application. I'll give you two free large pieces and one free T shirt. And it jacked up my financial life, because a month later, I'm in $500 of debt. A month after that, I'm in a thousand. And then two months after that, I'm in 15,000. In a matter of five to six months, I'm in $15,000 of credit card debt. And I wasn't even making $8 an hour at my job. I was working on campus. You want to save money, avoid debt at all costs. Another way to save money is you have to be on a budget. You got to know exactly what you're spending every day, every month, whatever you have needs to be on a budget. This way you know exactly what you have coming in and you know exactly what you have going out. Now, once you write down this budget, I want you to sit down, I want you to look at some things. What can you cut out? What are some things that you do not need? And you cut those things out. Number three, do not eat out. You don't have to buy the most expensive meal plan. Okay. You don't have to buy meals for every single day. Because the truth is the average student does not eat on campus every single day. If they do eat on campus every day, they're not eating all three meals on campus every single day. So if you just get a meal plan that just gives you a solid one or two meals a day, I'm fine with that. But you don't need three, four or unlimited meals. No. Because you're not going to eat there every single day. So stay away from credit cards. Have a budget and you stick to that budget. Don't choose the most expensive meal plan. Not only will it save you money, but it will save you time and it will save you frustrations.
- [13:36]
C
Best selling author and leadership expert John Maxwell says a budget is telling your money where to go instead of wondering where it went. While every student's financial situation may be different, you need to tell your money where to go in order to make it through your college experience without debt. And there's a lot to think about when it comes to expenses. Let me explain. Aside from tuition and fees, your room and board, which covers housing and food, could cost anywhere from 10 to $13,000 a year if you're living on campus. And beyond that, you'll need to shell out an average of $1,200 a year for books and supplies for all of your classes. But have you thought about going out with friends? You're gonna need money for entertainment and social outings. And to get around, you may be driving a car, which means you also have to maintenance, insurance and parking costs, which could add up to $5,000 or more per year. And you've probably changed your fashion sense since high school. So now you need money to spend on clothes and shoes. And to clean those clothes, you're gonna have to pay for laundry. And you're also getting haircuts every now and then, which also cost money. Oh, and we haven't talked about your smartphone, which can be more expensive than your laptop. And now that you have a smartphone, you also have a monthly bill. All of those Lifestyle expenses could add anywhere from 2 to $4,000 annually. So in total, you might spend another 18 to $23,000 a year after you've already paid tuition and fees. Are you tired yet? I am. What this all adds up to is a need for planning and budgeting. If you're concerned that you may not be able to afford all of these expenses, you may need to dig a little deeper into your budget. Brad Barnett, financial aid director at James Madison University, has some advice on this one.
- [15:26]
A
Yeah, so as we're communicating with people about ways that they can kind of tactically save or prepare for college, everything really goes back to the budget. It's are you really paying attention to where your money's going? And that's the first place to start because everyone's different. You know, to one person they're spending a ton of money on video games. To the next person they're spending a ton of money going to movies. To next person they're going out to eat all the time. So. So it's hard to say. Here's the thing, it's first I got to get you to pay attention to where is everything going? So where's your outflow? Once we figure your outflow, then we can tactically figure out what do we need to do to fix it. I had a student in one of my classes a couple semesters ago and he figured out at the very beginning of class when we were doing this whole budgeting exercise, he never paid attention to it. We walked through the numbers, he did all his tracking. He and his girlfriend were spending $40 a week going to the movies and he never really knew it, he just did it because, you know, just wipe out the card and go to the movies and you're good. But after the first month, when he realizes that between movie tickets and concessions and all that he'd spent $200 going to the movies, that was his thing. Alright, so if we can change that, you know, red box is a buck and change. You know, if we can change that, then there's a couple hundred dollars a month that you can use towards helping pay for college. Which means maybe you don't really need to borrow, but the problem is you get this lifestyle and you're looking for more on top of it. So let's just borrow more as opposed to changing what we're doing and using it a little better. So we deploy different strategies depending on kind of what that thing is or things for whoever we're talking to.
- [16:54]
C
The key to keeping expenses low in college is understanding that this is your time to live like you're broke because spoiler alert, you are. Here's Rachel Cruze from the Rachel Cruze show with some pro tips on how to save money in college.
- [17:09]
E
Some ways that college students can cut down on expenses and spending in college is to remember to live like a college student. You are not a 24 year old with your first job. You are a college student, which means you're probably broke and that's okay. And embrace it. Like, this is the time you don't have responsibility to take care of other people. This is the time if you have to eat frozen pizzas and ramen noodles, like that's what it is and enjoy it. The season of life is not going to come all the time. And I would rather you live like a college student while you're in college than try to live like a 25 year old and then graduate and have to go back to live like a college student because you have no money and so much debt. So make the sacrifices of lifestyle now. And the good thing is too, everyone else around you is in the same boat. Like they don't have jobs, a lot of them, right? So like they're not like rolling in cash. So be broke together, enjoy the time of life because that's the time that you can actually be broke and enjoy it.
- [18:02]
C
Working and budgeting your money may not cover all of your expenses when it comes to college, but Anthony has an easy way to give yourself a giant raise.
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D
Live at home. Okay, this is not really about having fun all the time. It's not really about being in your comfort zone. It's not about being around your friends. No, it's about making the best decisions. Remember, the caliber of your future will be depending upon decisions that you make today. And some of those decisions will are not going to feel good. You're not going to like it, but you're going to love it in the future. Okay? Room and board costs on average about $10,000 at a local state university. You don't want that if you do not have to have it. So if you have an option to stay at home, if you live less than one hour away from your college, you need to stay at home. Save that money. Do not waste your money on that. And if you're living at home, eat at home, maybe give your parents 20, 30 bucks a week to add a little bit more groceries so you can really have some nice stuff at the house that you like. But we have to be creative. The decisions that we make are not going to Feel good, but they will be good for our future. I'm not saying that you're going to be here for the rest of your life. No, because I don't want you there for the rest of your life. But what I am saying, this is only four years if you're grinding and really performing well in school. And I promise you this, you are going to thank yourself for staying at home because you saved so much money. And the moment you move out, yo, have a blast. Go have a good time, invite some mature friends over to your new apartment and you all just celebrate for some of the hard choices that you've had to make in the past. But now you're excited about where you're going in your future.
- [19:57]
C
It's way more ideal to crash with your parents at 18 than it is at 25 when you can't afford your own place because of your student loan repayments. The good news is that room and board isn't the only line item you can trim down. A recent study from College Board found that the average cost of books and supplies is over twelve hundred dollars per year. But Anthony thinks you can do a lot better than the average.
- [20:21]
D
You know. Now when it comes to your textbooks, I am a huge fan of quality used book and so I would do your research on this. Do not settle just to buy a brand new book. Go on websites like Amazon or Chegg or Big Words and see if they have your textbook available. You can find that book for about 30 to 50% off the brand new price. This saves you money and then some of them, if it's quality, still will allow you to send it back in and get a little bit of your money back. So technically, when it's all said and done, you can save anywhere from 30 to maybe 60, 70% on the book. But you gotta do the research and you have to make sure that it is the actual book that you will be using in class. Now if they do not have it, I don't want you to get cheap and don't even have a book. No, you still need to get your book. But before you go buy the new one, go see if you can find a quality used one online.
- [21:20]
C
So once you've cut costs on housing and books, there's still one area that many students just can't get control of. Food. As Anthony mentioned earlier, you've got to be smart about your college meal plans. The easiest way to save money on food and meal plans is to simply do the math. That was easy for Kyle. You heard from him in the Last episode. He's the math teacher who figured out some ways to save money in college and graduate debt free. So what are some other kind of college money saving hacks that you use just to do this in such an affordable way and not take out any debt? I did not go out. Everyone goes out and parties, right? I didn't do that.
- [22:00]
D
I wouldn't go out to eat.
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C
I'm a math guy, right?
- [22:02]
A
I'm a math teacher now.
- [22:03]
C
So I figured out that the best meal plan was like the 19 meal.
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D
Per week meal plan.
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C
And that's the one I chose because I knew that would be the best deal. I would go to our cafeteria and.
- [22:14]
A
On Sunday I would buy a bunch of Gatorade. Instead of getting the meal, I'd go to the church on Sunday nights and.
- [22:19]
C
I get the free meal there. And so just these little life hacks.
- [22:22]
D
I guess, that I didn't really think of.
- [22:23]
C
I just thought it was common sense.
- [22:24]
A
When I was doing it.
- [22:26]
C
According to Anthony, once you're working and saving, the last step is behaving. Here's radio host and financial expert Dave Ramsey on the link between behavior and success.
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B
Discipline and having clearly defined goals is a part of winning in any area of our lives. You know, if you're disciplined with your physical body and you take care of yourself, you win in that area. Undisciplined people look like it and they feel bad. Where you do not have set goals and you do not go through a series of behaviors with intentionality, you are never going to be in that area of your life successful. And college is no exception to that. If you want to go to college and graduate in four years, get the little sheet of paper from the admissions office that says, take these classes and you will have a degree in four years. Pass all of these classes and then get about the business of taking all of those in four years, and you will graduate in four years. It's magical. But that's setting goals. It's an intentional act. We're going to go right down the list. I have to take accounting 101, 102, and 103. I have to take an English class. I have to take a PE class. These are my requirements for graduation. You don't accidentally succeed at anything. I mean, no one wins the super bowl and they go, what happened? I don't know what happened. There's an intentional bunch of actions throughout your entire life as an athlete to get to play at that level and to win at that level. No one wins at anything. Accidentally winning at college Is not accidental. So it's simple stuff. It's know what classes to take, take them. Oh, by the way, go to class. Why are you here? What are you doing here? What's the goal? The goal is to get the knowledge and the degree that indicates that I completed the field of study.
- [24:10]
C
Behaving is more than just doing your work and passing your classes. In a world where kids are growing up documenting their lives on the Internet, Rachel Cruz has a warning for students that could be a difference maker when it comes to getting a job after college.
- [24:24]
E
When it comes to setting yourself up for success after you graduate from your college experience, just know that pictures on the Internet last forever. We are growing up in a social media world and your digital footprint is a real thing. And I have realized this even with people that I know that are applying for jobs and employers are going back and looking at their Facebooks from even college, their Instagram. So you have to realize what you put on the Internet, it stays. That's my first piece of advice for this generation. Number two, I would say focus on what's important. Like yes, I want you to have fun. I want you to have some great friends and enjoy your, your college experience. I did. I loved college. It was so fun. But you have to know the reason you're there. You're paying all of this money not just to hang out with friends, but you're paying this money to get a degree. And so if you're there, go to class, study, work hard. Are there going to be some classes that you do better in than others? Yeah, that's the reality that's going to happen. That happened to me. But at the end of the day, focus on your priority and remember your reputation and your social media follows you. After graduation.
- [25:28]
D
Make sure that you are a young man, a young woman of character and a young man or woman of integrity. Make sure that when you walk onto the campus, people respect your name. They know that you are a young woman and you're a young man who is a hard working and you are striving for success. You are striving for perfection. You're not out there just having a good time and partying and not really focused. No, you're behaving. You have character and you have integrity.
- [25:54]
C
One student who made intentional decisions to work, save and behave is Laura. With her parents help, she cash flowed her entire college journey through scholarships and working multiple jobs. Now she's getting her PhD completely debt free.
- [26:09]
F
Neither one of my parents went to college. My grandparents didn't go to college. It wasn't a thing. No one anticipated that any of the kids were going to go to college. So my parents didn't save any money for college. And they made it very clear from day one that if any of us were going to go to college, we would need to pay for it ourselves. My parents actually came to me out of the blue and said, you seem to really be determined to go to college. So we're going to pay for your first semester $2,000 and you're going to need to pay for it after that. So I heard about a program called the student ambassador program at the community college. And this was basically a program that in exchange for 40 hours of work, they would pay half tuition. So I ended up getting into that program and then I only had to cash flow about a thousand dollars so I could do that while working part time. And I asked my parents if I could stay at home while I was going to school.
- [27:06]
C
So how did you go about applying for scholarships? What was your process like?
- [27:10]
F
So I went to the scholarship office at the university and just asked what scholarships were available and they handed me paperwork on them. And once I had transferred to the four year university, I went to my department and they said that there are department specific scholarships that the main office won't tell you about because it's only for bio majors in my case. And almost nobody applies for them just because nobody knows about them. So those are really easy to get.
- [27:40]
C
So let's talk about work, because you said that you worked while you were in school. So what kind of jobs did you do and how much did you make doing those?
- [27:48]
F
I worked as a bank teller. I think I made $10 an hour. I worked at the jewelry counter at Walmart and I think that made about eight or nine dollars an hour. I worked as a waitress and that, you know, obviously fluctuated a lot.
- [28:02]
C
And did it affect your grades at all?
- [28:04]
F
No. So I found my final semester I had enough money saved up that I could actually live off of my savings. And I thought, okay, for my final semester I'm gonna do really great. So I quit my job, decided to live off of my savings, and I went from a 3.9 something GPA down to a 3.8 within one semester. So I had had five years of almost exclusively A. And then the semester that I stopped working, it actually dropped. And I think the reason my grades were good was because if you had two hours to study, you studied immediately because that was the only time you had available. And then once I quit my job and all the time could be used for studying. If I wasn't in class, it was fair game. I almost never did. I was very, very lazy because I always felt like I could do it late and then later. Just never happened.
- [29:00]
C
What are some of your other kind of best tips? College hacks for saving money while you're in college.
- [29:05]
F
Things that I would suggest people do is make connections with teachers for letters of recommendation for scholarships. Those letters of recommendation are going to be awesome. Even if the scholarship doesn't give money. If it's just an award, that's great. You can put that on your resume and you're more likely to get the next scholarship. I could not have done it without all of the scholarships and really digging deep for scholarships. So work really hard, don't give up, because it's absolutely worth it. And then obviously I couldn't have done it if I hadn't gone to a school where I could afford the tuition.
- [29:43]
C
How do you feel like you were set up for success in your future because of how you handled your money in college?
- [29:49]
F
Well, thinking immediately, my husband and I have been able to pay off, I think it's about $30,000 on our house this year. We just got married less than a year ago, so all of my income is going straight on the house. We have saved $40,000 for house renovations. So not having to pay that money towards my student loans. We're hoping to be millionaires by the time we're 40.
- [30:12]
D
Wow.
- [30:12]
C
And you're 30 years old. Well on your way to not only becoming a millionaire, but to doing all these dreams and, and it's a reality because you don't have student loans, you don't have any type of debt to worry about.
- [30:26]
F
Yeah, absolutely not having student loans has completely freed up the rest of my life to not worry about paying things back and instead just be able to get straight to life. Be able to have kids when I want, be able to go on amazing vacations when I want pay off the house. Yeah, we're really excited about it.
- [30:47]
C
So what are you going to tell your kids to keep them out of student loan debt?
- [30:50]
F
I would say as long as you are determined to go to school debt free, you can absolutely do it. Don't be afraid of work, don't be afraid of what everybody else is saying. Go to a university that you can afford. Apply for scholarships like it's going out of style. Don't be afraid to drive a junky car and not have any time for your friends. If they're real friends, your friends will be There when you get done. I got something extra out of my education due to paying for it. I remember some people would tease me because I would never skip a class ever, ever. And they would wonder why. And I would tell them, I was like, I paid cash to sit in this lecture. I calculated it out one time and it was something like 20 or $30 per lecture. And I was like, that's like a concert ticket. If I spent $30 to go to some show, I would absolutely show up. So why, if I'm spending tuition to hear this lecture, would I not go sit in that lecture? So it's kind of a self fulfilling prophecy. If you have already decided that you can't do it, if you decide that you're going to do it no matter what, then you're going to actually get that done.
- [32:00]
C
This is solid. I mean, I think the summary is live broke now so you don't have to live broke later.
- [32:07]
F
Yeah, live broke now so you don't have to live broke later.
- [32:12]
C
If you follow the steps Anthony talks about, you'll soon find yourself passing your final exams and getting your cap and gown ready. There is a glorious light at the end of this collegiate tunnel when you do it without going into debt.
- [32:25]
D
Can you imagine? You walked onto the campus debt free. You said no to the student loans. And when you get to graduation day and when you walk up on that stage and you're 10ft away from that degree, you grab that degree and you come off the stage the same way you came onto the school campus debt free.
- [32:48]
C
If you've been listening to this series and you feel like it's too late for you because of your student loan debt, we hear you. We've read your comments and reviews and know that many of you are struggling with your payments and want to leave your loans behind. If that sounds like you, here's a message from Dave Ramsey.
- [33:05]
B
If you're out there and you're scared and you're overwhelmed with your student loan debt, understand? And no shame. I'm not here to beat you up. I want to help you. It feels like you can't ever get out. But here's a secret. There's a recipe for dealing with something super large that's overwhelming. The recipe is, how do you eat an elephant? A bite at a time. So what you need is a plan that says, okay, got this much student loan debt, how much can I pay on it per year if I really get on a tight budget and work an extra job, pay that much, Then you divide that into the student loan Debt, debt. And you probably will look up and say, you know, if we got very serious at this, really intense about this, we can pay the student loan debt and all our other debt off in two years or three years, or if it's really extreme, maybe five years. But the idea that you're going to keep this student loan debt around for 25 years, you need to adjust some stuff. You need to adjust the way your mind is looking at it. You need to just look at the mathematics of it and say, there's no reason. It's $200,000. Okay, $10,000 a year for 20 years. No, you can do more than $10,000 a year. That's only 800amonth. You can make that as your extra job alone. Then trim your budget back, work your job, work your career, get your income up, trim your budget back, trim your budget back, trim your budget back. And begin to attack. And even something as crazy as a $200,000 loan can be made to go away. But it's how do you eat an elephant a bite at a time? It can be done. I know this because I have witnessed it with hundreds of thousands of people who thought they were stuck forever. And we were able to show them how to get out of debt.
- [35:02]
C
Throughout this series, we've painted a picture of the student loan debt crisis in America. If you've been following along, it's not pretty. In fact, after digging into it, it's even uglier than we thought we covered. Why student loans are not good debt, why college may not be all it's cracked up to be, what options students have for an affordable education, the everyday burden that student loans have put on so many lives, the dark and twisted history of how we got here, the failed forgiveness programs and empty promises of future ones, the economic implications and ripple effects, and finally, a no nonsense plan to avoid this crisis and graduate college debt free. Staying away from debt and saying no to student loans will not be easy. But the alternative of living with student loans for potentially years to come is a thousand times harder. Hear me say this. If you're not in college yet, you have an amazing opportunity to bypass all of the heartbreak and anger and regret. If you're one of those dealing with the weight of student loans, you can get out faster than you think. And you don't have to wait for anyone's permission. I've never met a single person who has avoided debt or paid off their debt who says that it wasn't worth it. I have talked to countless people, many who you've heard from in this series who tell me that they wish they could go back in time and make a different decision. So make a different decision now. Say no to debt now so that you can afford to say yes to your future.
- [36:35]
E
One of the stories that comes to mind when it comes to student loans truly damaging this generation and what they want to do is I was speaking at a college, a private college up in Minneapolis, and at the end of my talk, I had a student come up to me, and he asked me, rachel, I'm getting married after I graduate in May, in a few months. And I was like, oh, congratulations. He was like, yeah. His question to me was, so, what do I do with my student loans? And I was like, oh, well, how much student loan debt do you have? And he was like, oh, I took out loans to go to the school, so it's about $90,000. And I was like, $90,000? And I was like, what's your degree in? And he said, english. So in my head, I was like, you have an undergrad degree in English and you have $90,000 in debt. Like, that number hit me like a ton of bricks. And I could tell emotionally it had not hit him because he's not been paying the bill on it yet. And then he goes on to tell me that his fiance had student loans. So I went and asked, okay, so how much student loan debt does she have? And he said, it's gonna be about $90,000 as well, $180,000 that this couple's gonna have as they're starting off their lives. And then he proceeds to tell me that their plan after getting married is to go and serve on the mission field. And so he asked me, okay, so what do we do? And I'm sitting there, and I was a little bit nicer than this, but I thought, what do you do? You can't go on the mission field. Like, you have to go get a job. You have bills coming in the next six months that are going to be pretty massive, and you're going to have them for a really long time. And so it was just this starring example of what student loans have become in this generation. They really have become a roadblock to what this generation wants to do with their lives. And so they have to go find a job, a job they may not even like to pay back these loans instead of going and doing what they want with their life. Student loan debt does not feel real to students. Number one, students that are in school, they're not having to pay the bills, right? They're getting hit by that student loan payment six months after graduation. So they're not feeling the repercussions of their decisions in the moment. And it has been so normalized. When you just think, okay, this is the only way you can go to. That's the lie that's been told to you. Everyone in your life that you trust, from your guidance counselor to maybe even your parents, that's what's been told to you. And so when you believe that over years and years and years, it becomes so normal that it's just the way it is and there's no shock factor, and that's what I want back in America is the shock factor of what student loan debt does.
- [38:59]
D
I have people who work on my team who do not have a Harvard degree and I will hire them because they have character, they have hard work ethic and they are passionate about what they do. What impresses the average employer is are they willing to continue learning? Are they willing to be the hardest working person in the room? Do they desire to be the very best person at this particular career field?
- [39:20]
C
Remember Mladen from the last episode? He's the immigrant from Croatia who is now a multi millionaire. Thanks to a debt free degree and a boatload of work ethic, he has a unique perspective on the American dream.
- [39:34]
D
I think that solution to this crisis is there's no single item that can make this go away. I think it's a multi pronged approach. I do believe that the first order of business is to educate young people not to go into student debt so easily because that's how you stop adding to 1.5 trillion that we currently have. I do not believe in government solving the problem. I do believe that we all make individual choices and that there's a signature, even though I have never seen it on that contract, right, that says that somebody was accepting the terms of that loan. I do believe that some assistance may be required, but simply just wiping out and saying that the problem doesn't exist for the person, I don't think that that's setting that population for success going forward. Because then I can apply that if somebody took care of my student loans, then I can take more other loans because of the way that this situation was handled. So I do believe in personal responsibility, but I do believe also that government.
- [40:42]
C
Has a role in long term solutioning.
- [40:44]
D
Of this as well.
- [40:46]
A
And so when we think about this great nation and we think about why people come here, here, it's really one word, opportunity. We all just want a shot. Give me a fair shot. To do what I want to do, to be who I want to be. That's the American ideal. That's the American dream. And so we need to understand that that dream is accessible for everybody if we simplify our focused intensity on getting around the right people and in the right places.
- [41:16]
B
Sometimes I'm talking to people on the radio show and they think completely overwhelmed. They've got a mountain of student loan debt. They're terrified. And the first thing I do is I kind of join them in that. It scares me a little bit too, because I know that if I'm talking to one, that there's hundreds of thousands just like them out there. And as an American, that's a little bit terrifying. And this. Then I get to dig into their story a little bit and I get to do some math with them, and I get to show them that there's a way out, that there's hope. And so I go and they go on that call when we're talking together, from terror and being overwhelmed and hopeless to seeing a way out, hope and going, I think if I take some of these dramatic, crazy actions that Dave's talking about, I can get rid of this. And so I go from being overwhelmed with them to being hopeful with them.
- [42:19]
C
Hope is powerful. And while everyday people are working to get themselves out of debt, there are others out there who are working to end this crisis completely. Here's author Seth Godin and whistleblower Seth Frotman.
- [42:32]
D
There are a lot of people who quite rightfully say, I did everything I was told to do. I did everything I was supposed to do. Now I'm in a boatload of debt. I'm not happy about it. How are we going to keep this cycle from repeating itself? Well, to the first group of people, I'm sorry that you shouldn't have trusted the system. The system let you down. How do we keep from repeating it? Is stop telling people this is what they're supposed to do. Stop telling people that this is the path. You know what? This isn't what you're supposed to do. It might be easier. It's definitely more fun in the short run. But here it is with subtitles. This is not what you're supposed to do. What you're supposed to do is figure out how to make a contribution, not figure out how to make a marketing industrial governance system happy in the short run. After I left the Bureau, I was lucky enough to start the Student Borrower Protection center, where me and many of my members of the team that was working on student debt at the CFPB are trying to do the same work, which is there's a whole bunch of folks throughout America at the state level, the local level, the nonprofit world, who are trying to think about how you deal with student debt. Everything from the predatory players to, hey, I'm a city, and I'm trying to get a handle on what this is doing. So we've been trying to think through how you build an organization where there's.
- [43:56]
A
A bunch of folks who wake up.
- [43:58]
D
And think about student loans and go to bed about student loans, and how could we work with anyone and everyone, how they could be part of the solution. Right. So if you're a city, we're going to help you think through, like, how.
- [44:11]
A
You engage with your constituents.
- [44:13]
D
If you're a law enforcement official and you're interested in going after folks ripping.
- [44:17]
A
Off your constituents, you know, we could.
- [44:20]
D
Help you think through what that looks like. And then also, just like, continuing to talk about the issues of student debt and the impact it's having on our country and doing so, I think, hopefully, like, in a really thoughtful way.
- [44:35]
C
Don't let a predatory lender, a misguided counselor, an uninformed parent, or an inefficient government derail you from your dreams. You get to choose how bright the future looks when you decide to be a student without a student loan.
- [44:49]
D
As a former athlete, I've had some amazing coaches in my life. Coach Ernie Horning was my defensive coordinator in college, and he gave me a phrase that's been one of the most impactful statements that I've ever heard. He told me, don't make excuses, make progress. And that's something that really stuck with me. I think growing up from a small town in Kentucky, it's easy to try to find excuses. It's easy to try to blame other people for things in your life. And I think having learned that lesson of not making excuses, but if I've messed up, I've messed up. I need to own it. And if something's gone well, it's okay to own that as well. And so I just want to encourage young people out there. I don't know where you were born. I don't know the kind of family you were raised in. I do know this, that you're in control of you. You don't need a permission slip to be able to try harder, to make sacrifices and be able to win. I want you to dream big. I want you to dream in high definition, but I also want you to have the courage to work hard to make those sacrifices to get the right people around you that believe in you so you can cheer them on and they can cheer you on. Opportunities available. We've just got to make our way.
- [45:54]
A
There's an awesome trend right now with companies and what they're looking for when they hire. And it's really not about the degree anymore. It's, do you have the requisite skill set that we can hone? So it's back to this idea of what do I do best? And companies are going, if you've got the core talents, we can train you on the job. And that's why you're seeing a lot of people not needing the college degree. We're seeing big name businesses drop the college degree requirement because they're saying this, I want high character. That's a good person who's going to be committed and come in and be hungry and do their job, want to learn, be a part of the team and grow. And then if they've got the core talent, we can train for the skill. Because the economy is rapidly changing, we all know this technology is changing the game as we sit here today. The way that jobs are created and executed will radically change in the next five to 10 years. And that's just a reality. So companies are looking for character, good people and core talent that they can then shape and train.
- [46:58]
C
So.
- [46:58]
A
So don't get so hung up again on the name brand degree and the major that some magazine told you is highly attractive. What's attractive is talent and character. And let's add hunger and humility to that as well. I want to succeed. Teach me. I'll be a human sponge. I'm just grateful to be here. It's not my dream job. I'm on the lower rung of the ladder, but I'm on the ladder. And if I'm not on the ladder, I can't climb. Come in, know your role, accept your role, maximize your role. Those three things will constantly put you in a place to be promoted.
- [47:32]
E
Some encouragement I would give to high schoolers who are about to embark in college is I have rarely talked to someone who is really excited about their student loans. Like after they graduate and they enter the real world, they start their lives and they look up. Majority of the time they look back and they regret it. Rarely do I hear someone say, oh yes, I get to pay my student loan debt. I'm so excited about it. No, a lot of time they look back and they say, I went to a school I couldn't afford. Why did I go there? Why didn't someone tell me? And also I got a degree in something that I'm doing something completely different in, so I'm in debt to something that I'm not even using after graduation. And so all these factors in play, I'm telling you the 34 year old version wants to take the 15 year old version of you and say please, please do not spend a decade of your life paying back student loans when you can prevent it. When you can prevent it by going to a school you can afford, apply for those scholarships and grants, work, do whatever you can to avoid student loans. And so you won't regret that when you graduate from college with your degree with no student loans and you've worked hard, a hard four years of sacrifice, you're going to look back years later and not regret that. But the regret comes when you take out student loans.
- [48:46]
C
When you avoid becoming a statistic, you can live your life with no regrets. There are 44 million student loan borrowers in this country carrying a total of $1.6 trillion in student loan debt. The average American graduate pays $393 every month in student loan payments. A recent survey showed that students expect to pay off their loans and in six years, while in reality it's taking them over 20 years to pay them off. 56% of people between the ages of 18 and 29 have put off major life events like getting married, purchasing a car or home, or saving for retirement, all because of their student loan debt. And over 50% said they're waiting to start a family because of it. About 1 in 10 people with student loans were late with or completely missed their payments. Nearly 4 in 10 students who drop out of college default on their student loan. Roughly 1 million student loan borrowers go into default every year. That is one every 28 seconds. Anthony O' Neill wants you to rise above the stats and take control of your future.
- [49:53]
D
If you remember nothing else from anything I've said over the last eight episodes, I need you to say goodbye today. Debt forever, you guys. This is your life. You're not taking out any debt. No debt of any kind. Say no to debt for the rest of your life. You will work, you will make the hard decisions that will change and impact your future. Because you're not going to borrow against your future anymore. You're not going to take out student loans. You're not going to even think about opening up, up a credit card. You're not going to believe that student loans are good debt because we've proven it's bad debt. You're not going to believe that you have to go to college to get a good job. You're not going to believe that your value is based on where you graduate from. Because if you're smart, you're smart. It boils down to your character, your hard work ethic. And if you're living with intentionality, there's $1.6 trillion in student loans and you're not going to be a part of that stat because we're creating a new stat. And what's that stat? We already know? A debt free generation stat. Decide right now, because if you don't, you will end up like everyone else, in debt, in bondage, not going after their dreams. You're going to make hard decisions and take responsibility for your life. You're going to join the movement of students who are going to take debt off the table. You're going to create a vision. Because where there is no vision, that's where people perish. That's where our futures perish. You're going to do the research and prep and pick affordable schools. It's decision day because our dream schools are now affordable schools. And affordable schools are schools that we can go to debt free. You're going to work and you know what? I'm gonna be real with you. It's gonna be hard work, but it's going to be worth it. And while you're working hard, you're going to save and live on a budget while you're in school. You're not gonna allow anyone to distract you from taking control of your future. You're gonna behave because character counts. And you, you're going to walk the stage the same way you came into school debt free. I want you to be the person that your future self, your 50 year old, your 60 year old, your 70 year old will say thank you to. Because you guys, it is possible to go to college 100% debt free. I know this because every single day I'm going to colleges and universities and I'm meeting people who have done it and they are doing it right now. And you can do this too. It is possible for you to go to college debt free. I'm gonna say that one more time. It is possible for you, yes, you to go to college debt free. Because remember, the caliber of your future depends on the choices you make today. So I am with you. Today is the day you make the choice that no matter what happens, no matter what comes your way, you take debt off the table. And when you take debt off of the table, you've just changed your future.
- [53:30]
E
So I was able to go to college debt free by working a full time job. I was able to cash flow a.
- [53:36]
D
Master'S degree in nursing education by working.
- [53:39]
E
Overtime as a full time nurse, a.
- [53:42]
D
Good job at a parts store working 40 to 50 hours a week delivering.
- [53:46]
C
Pizzas and plenty of other side hustles along the way.
- [53:49]
D
With the help of some scholarships, I.
- [53:51]
C
Ended up getting a full ride scholarship.
- [53:53]
D
To a local university working three jobs.
- [53:56]
A
Averaging 50 to 60 hours a week, a partial scholarship to play tennis.
- [54:01]
D
I worked a full time job 7.
- [54:03]
A
Days a week with 2 days off a month due to the company reimbursement.
- [54:07]
D
I was able to cash flow.
- [54:08]
F
Didn't have any scholarships but I worked really hard. I was a waitress, I was a dishwasher, I cooked, I did delivering mail.
- [54:16]
D
I did clerical work.
- [54:17]
F
I had multiple jobs.
- [54:18]
D
My parents did not give me an option. They said I had to work my way through school. I mowed lawns every single weekend and during every summer for four years.
- [54:28]
C
10 to $15,000 was what I was.
- [54:30]
E
Able to cash flow. I was able to cash flow a little over $17,000.
- [54:36]
D
We were able to cash flow at $20,000. I've been able to cash flow 30 to $40,000 worth of college $42,000. I cash flowed myself over $45,000. I was able to cash flow over.
- [54:48]
A
$45,000 in education costs.
- [54:50]
F
I cash flowed approximately $60,000.
- [54:52]
D
I paid $80,000 over four years about.
- [54:56]
E
$140,000 for my undergraduate degree.
- [54:58]
F
Graduate debt free in 1989 and I.
- [55:01]
C
Graduated in 1998 completely debt free and.
- [55:04]
D
I ended up graduating debt free and I actually had $40,000 in the bank when I did graduate. So it definitely is possible to graduate debt free. Graduated in 2010 debt free. I graduated in 2012 debt free.
- [55:17]
A
I grabbed graduated in 2016 with my degree and no debt.
- [55:21]
D
I was able to graduate this past May 2019 debt free. I will graduate next December debt free.
- [55:32]
C
Over this eight episode series, we've been on a journey to uncover the pain of student loans, the predatory nature of the industry, and give you a plan to help you avoid the dumpster fire that the student loan debt crisis has become. Thank you for joining us. This is just the beginning of our conversation. While making this show, we reached out to many politicians and experts and hope to include them in our ongoing dialogue. If you enjoyed this series, share it with a student in your life and tell them that they can go to college debt free. Share it with parents, teachers, pastors and anyone else that speaks into the lives of young people. With so many misconduct misconceptions out there, we need your help to educate our students on the dangers of student loans. You've been listening to Borrowed Future. Thank you for listening to Borrowed Future. If you like what you've heard, do us a favor and rate and review us on Apple Podcasts. It helps. You can find more information about this and other Ramsey network podcasts@borrowedfuture.com or on your favorite podcast app. Tell us about your student loan experience by emailing storyborrowedfuture.com every week. On this podcast, I've said the names of the people behind Borrowed Future and for this episode I wanted to let you hear them say their names for themselves. The show is produced by the following Chris Wright, Eric Cieslovich, Eva Daniel, Kevin.
- [57:00]
A
Weimer, Tim Hull, Will Rudder James Childs, Blake Thompson.
- [57:06]
C
This is our team and this podcast wouldn't have happened without them. I'm George Camel and remember, debt free is the way to be.