New Reality Show Tackles Student Debt

Summary

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WSJ Your Money Briefing

Episode: New Reality Show Tackles Student Debt
Date: October 17, 2019
Host: J.R. Whalen (Wall Street Journal)
Guest: Julia Carpenter (WSJ Reporter)

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Episode Overview

This episode delves into the new reality TV show "Going From Broke," executive produced by Ashton Kutcher, which takes on the U.S. student debt crisis—now totaling $1.5 trillion. The discussion centers on how the show brings attention to the struggles of young people in debt and offers a makeover-style approach to financial rehabilitation, all while navigating the intersection of entertainment and personal finance education.

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Key Discussion Points & Insights

The Premise and Approach of "Going From Broke"

• Makeover, Not Just Game Show:
  • Unlike prior debt-focused TV shows (like "Paid Off" or CNBC features), this show takes a "makeover" approach reminiscent of "Queer Eye" or "The Biggest Loser."
    • "Ashton Kutcher said that his inspiration for the show was Queer Eye and the Biggest Loser." (Julia Carpenter, 02:47)
• Budget Analysis:
  • In each episode, the two hosts help participants by thoroughly examining their budgets and lifestyle decisions.
    • "Every episode begins with the two hosts sitting down with the person who's at the center of the episode. And they go over their budget and they estimate how much they spend versus how much they earn." (Julia Carpenter, 03:13)

The Human and Emotional Toll of Debt

• Emotional Struggles:
  • Participants share personal stories, revealing the crushing emotional weight of debt, which often impacts all aspects of life:
    • "When the world is pushing down on you, it's very hard. I'm broke and I work all the time. It doesn't feel like I'm paying it off. I currently live in my car." (Promo clip, 02:16)
    • "It's something that's really emotionally afflicting as well as changing their lifestyle." (Julia Carpenter, 03:42)
• Lifestyle Changes to Cope:
  • Examples include signing up for income-based repayment plans and cutting expenses, like selling a car or finding alternative ways to cover payments (e.g., wrapping a car in advertisements).
    • "One of the women...she was wrestling with student loan debt...she's going to sign up for income based repayment." (Julia Carpenter, 03:42)
    • "The couple decides that they only need one car, and the one car they're going to rely on, they're actually going to wrap their car in an advertisement and that can handle the car payment." (Julia Carpenter, 06:04)

Real Life Crises Behind the Debt

• Stories of Setbacks:
  • Many participants ended up with massive credit card debt or other financial troubles due to accidents, layoffs, or unexpected life events.
    • "Debt happens. Like, debt is always an accident away. It's always a layoff away...she'd recently been laid off. He'd been in an accident and so had had to go on injury leave from his job." (Julia Carpenter, 05:07)

Debt as a Double-Edged Sword

• Potential Upsides and Risks:
  • While debt can signal financial responsibility if managed well, its emotional and practical impacts can be overwhelming if not handled properly.
    • "Debt can be a good thing. It can prove to credit card companies...that you can pay down, you can be responsible, you can structure payments." (J.R. Whalen, 05:45)
    • "The emotional toll that debt takes...it affects every other decision they make in their life." (Julia Carpenter, 06:04)

Product Placement and Financial Advice on TV

• Blurring Lines with Advertising:
  • The show features integrated product placements, such as Acorns debit cards and signing up for renters insurance with State Farm, raising questions about consumer awareness and potential conflicts.
    • "There's a whole scene where they go sit down at State Farm and sign up for renters insurance. There's these product placements...and you just gotta watch for the brand on the front end." (Julia Carpenter, 06:53)
• Regulatory Context:
  • While not strictly a legal issue, the FTC and FCC do require clear disclosures about product placements.
    • "That was something that was really interesting to me...it's not necessarily a legal tightrope...But it's something...viewers definitely need to be kind of cognizant of when they're watching it." (Julia Carpenter, 06:53)

Ashton Kutcher’s Involvement

• Producer and Investor:
  • Kutcher serves as an executive producer and has invested in some of the companies featured in the show, including Acorns. He also makes a cameo to advise an aspiring actor.
    • "He's a one time investor in two of the sponsors of the show and then he is an investor in Acorns...He also makes an appearance in the show. He makes an appearance at one point to give some advice to this aspiring actor." (Julia Carpenter, 07:41)

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Notable Quotes and Memorable Moments

• On the magnitude of student debt:
  • "I was able to take out $80,000 in loans. No 18 year old should be able to do that." (Promo clip, 03:26)
• On the overwhelming reality of debt:
  • "The world is pressing down on me, like, I'm unable to make these payments." (Julia Carpenter quoting participant, 03:42)
• On the source of financial difficulty:
  • "Debt is always an accident away. It's always a layoff away." (Consumer advocate cited by Julia Carpenter, 05:07)
• On the emotional impact:
  • "The emotional toll that debt takes on each of these participants is...it affects everything. It affects every other decision they make in their life." (Julia Carpenter, 06:04)
• Humorous acknowledgment:
  • "The host of the show just puts his hand on his forehead and goes, aye, yeah, yeah, yeah, yeah, yeah, yeah." (J.R. Whalen describing a moment, 05:03)

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Timestamps for Important Segments

• 02:16 – Promo: Real voices expressing the struggle of living with student debt.
• 02:47 – Julia Carpenter explains the show's unique makeover approach.
• 03:26 – Promo participant: “No 18 year old should be able to do that.”
• 03:42 – Discussion of the emotional toll on participants.
• 04:55 – On the backgrounds leading to debt: layoffs, accidents.
• 06:04 – How debt shapes life decisions; strategies like income-based repayment.
• 06:53 – Product placements and marketing within the show.
• 07:41 – Ashton Kutcher’s investment ties and personal involvement.

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Conclusion

"Going From Broke" combines reality TV with genuine financial intervention, tackling a problem affecting millions and highlighting both the emotional and practical sides of debt repayment. While offering actionable advice, the show also walks a fine line regarding the integration of financial products and celebrity investment. Listeners are reminded to be critical of the show’s marketing but also to take away its core lessons: the importance of confronting debt and making deliberate financial choices.

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Transcript

[Charles Schwab Sponsor Voice]

This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. Washington Wise from Charles Schwab is an original podcast that unpacks the stories making news in Washington. [e-mail] Washingtonwise.

[J.R. Whalen]

Here's your Money briefing. I'm J.R. whalen at the Wall Street Journal in New York. You've heard a lot about the $1.5 trillion student debt crisis. Well, now actor Ashton Kutcher is behind a new reality TV show with a unique take on helping students pay down their balances. We'll take a listen in a moment. First, some money and market news you should know there was bad news and good news in the September retail sales report. American shoppers pulled back on spending in September, with purchases at stores and restaurants as well as online, falling for the first time since February. That's the bad. The good news is part of that drop was because gas prices were down, which impacted sales at gas stations. Americans also spent about 1% less on vehicles in September, a turnaround from a 2% gain in August. A separate measure of U.S. consumer spending suggests uncertainties around trade are weighing on other parts of the global economy. Personal consumption expenditures slowed more than expected in August. Manufacturing and service sector activity in the US and the Eurozone has also slowed. A report from LeanIn.org and McKinsey Co. Indicates more women are being hired for director level jobs and higher and women in senior level roles are being promoted at higher rates than their male counterparts. But while representation of women in the so called C Suite grew 22% by 2018, it fell 1% in 2019. The report also found women are still significantly underrepresented at all levels of management, accounting for just one in five executives. But women are leaving jobs at a slower pace than men and they're on par with men when it comes to asking for promotions and raises. A new TV show debuts this week that tackles a financial problem impacting millions of students and families around the country. The $1.5 trillion student debt crisis. Have a listen.

[Julia Carpenter]

When the world is pushing down on you, it's very hard. I'm broke and I work all of the time. It doesn't feel like I'm paying it off. I currently live in my car.

[J.R. Whalen]

We are in a amount of debt.

[Julia Carpenter]

Our biggest fear is that we're gonna lose our family.

[J.R. Whalen]

Actor Ashton Kutcher is executive producer behind the show called Going From Broke, and Wall Street Journal reporter Julia Carpenter is here to discuss. So Julia, this isn't the first TV show to focus on young people mired in debt. But it approaches it from a different angle.

[Julia Carpenter]

We've seen other shows that take it from kind of this either game show perspective like Paid off or CNBC shows that showcase many icons like Gail Vaz Oxford. And this is thinking about it more in terms of a makeover. Ashton Kut said that his inspiration for the show was Queer Eye and the Biggest Loser.

[J.R. Whalen]

And it's not as if somebody just swoops in and pays down a student's debt.

[Julia Carpenter]

Right.

[J.R. Whalen]

Many of the young people spotlighted on the show, they face some very tough lifestyle decisions.

[Julia Carpenter]

Totally. Totally. Every episode begins with the two hosts sitting down with the person who's at the center of the episode. And they go over their budget and they estimate how much they spend versus how much they earn. And they kind of crunch that for them and then make suggestions.

[J.R. Whalen]

One person makes a particularly interesting point. In one of the promos for the show, I was able to take out $80,000 in loans. No 18 year old should be able to do that. You know, Julia, that's a lot of money for an 18 year old to take out. I don't know that an 18 year old would be able to take that much money out for a house.

[Julia Carpenter]

It's interesting because listening to the amounts of money that people were grappling with on the show, it's something that's really emotionally afflicting as well as changing their lifestyle. So the show's kind of dealing with both of those pieces of it. One of the women we heard in the promo, she was wrestling with student loan debt and ultimately decides, kind of with the help of the host, that she's going to sign up for income based repayment. And they talk over the course of the episode about the benefits of refinancing your student loans, restructuring these payments in different ways. But they're also talking a lot with her about that emotional toll. I think she says at one point in the show, like, the world is pressing down on me, like, I'm unable to make these payments. I'm dealing with these other things. Here's my other budget concerns, like how am I even meant to get going with this?

[J.R. Whalen]

And, you know, whether it's student debt, a house mortgage, automobile debt, debt's not going to go away. So you may as well learn these lessons and then take them forward.

[Julia Carpenter]

Yeah, I mean, I mean, I think the ultimate goal is that the debt will go away. I think the ultimate goal is like figure out how to make payments toward this or how to kind of minimize what you're already spending. Like, there's one couple in the show, Max and Megan, they're really deep in credit card debt. They have 12 credit cards they have to cut.

[J.R. Whalen]

Yeah, you know what? And I saw a clip and the host of the show just puts his hand on his forehead and goes, aye, yeah, yeah, yeah, yeah, yeah, yeah.

[Julia Carpenter]

It's a really big moment.

[J.R. Whalen]

That's a lot of credit cards when you're trying to get out of a mountain of debt.

[Julia Carpenter]

Totally. I mean, but again, the circumstance behind that, and I try to touch on this a bit in the piece, is that. And there's a great consumer advocate I spoke with and he said, you know, debt. Debt happens. Like, debt is always an accident away. It's always a layoff away. And that couple in the show, the background of their circumstance is that she'd recently been laid off. He'd been in an accident and so had had to go on injury leave from his job. So relying on these credit cards basically to make ends meet. And by the time the hosts come in, they're like, you don't have to do this. There's other ways to handle this. But there are also these huge structural issues kind of looming in the background of each episode.

[J.R. Whalen]

And, you know, debt can be a good thing. It can prove to credit card companies, it can prove to agencies that you can pay down, you can be responsible, you can structure payments. And so it's important that if you can wipe away your student debt, being able to have that skill and can really help you in your lifestyle and build your life in years to come.

[Julia Carpenter]

I think the point they're making in the show is that debt, the emotional toll that debt takes on each of these participants is. So it affects everything. It affects every other decision they make in their life. So approaching the problems, whether it be they. The example. One of the examples in the first episode is that the couple decides that they only need one car, and the one car they're going to rely on, they're actually going to wrap their car in an advertisement and that can handle the car payment. With Miracle, she decides she's gonna sign up for income based repayment because it is as she's building her music career.

[J.R. Whalen]

Miracle is a woman in the promo we heard at the start of the interview.

[Julia Carpenter]

Yes, yes. And she says, you know, as I'm building my music career, like, I'm gonna sign up for income based repayments so that I can structure my payments accordingly.

[J.R. Whalen]

The show also walks a bit of a legal tightrope involving the promotion of financial products Right.

[Julia Carpenter]

Yeah. That was something that was really interesting to me when I was researching this because it's not necessarily a legal tightrope. There's actually not a lot of rul the FTC or the FCC about what you can promote in the show. But it's something I think that viewers definitely need to be kind of cognizant of when they're watching it. You know, you take a break and promote the Acorn's debit card. There's a whole scene where they go sit down at State Farm and sign up for renters insurance. There's these product placements or these advertisements that are kind of already integrated into the programming and you just gotta watch for the brand on the front end.

[J.R. Whalen]

But the show plans some sort of disclaimer, doesn't it?

[Charles Schwab Sponsor Voice]

At some point? Yes.

[Julia Carpenter]

Yes. Yeah. I mean, that's kind of what the FTC and the FCC say is required.

[J.R. Whalen]

Now, besides being executive producer, does Ashton Kutcher have some sort of financial relationship with the companies involved?

[Julia Carpenter]

Right. Yeah. He's a one time investor in two of the sponsors of the show and then he is an investor in Acorns. Pete, our reporter, has written about that in the past. And Acorns has partnered with celebrities like Alex Rodriguez and Jennifer Lopez, so they already have relationships with other big names like that. And he also makes an appearance in the show. He makes an appearance at one point to give some advice to this aspiring actor.

[J.R. Whalen]

All right. The show is going from broke streams on Chicken Soup for the Soul and on Sony's Crackle Service. And Wall Street Journal reporter Julia Carpenter is good enough to be here in our studio. Julia, thanks for coming on the show.

[Julia Carpenter]

Great. Thank you.

[J.R. Whalen]

And that's your money briefing. I'm JR Whalen in New York for the Wall Street Journal.

[Charles Schwab Sponsor Voice]

This episode is brought to you by Charles Schwab. Decisions made in Washington can affect your portfolio every day. Washington Wise from Charles Schwab is an original podcast that unpacks the stories making news in Washington. [e-mail] WashingtonWise.