Is College Worth It? Myth vs Reality

Welcome to the Get Out of Debt Guy podcast.
I’m Steve Rhode, the old original, and some might say, well aged, get out of debt
guy.
I find wine.
And I’m here with a newer, shinier, and less likely to yell at clouds version of Damon
Day.
Say hello, Damon.
Hello, Damon.
Today we’re tackling a question that’s been quietly eating away at a lot of families.
Something Damon and I have talked about for years.
Is going to college still worth it?
Or is it just some outdated boomer advice that needs to be left behind with floppy disks
and fax machines?
We’re going to look at the numbers, the debt, the opportunity cost, and most importantly,
what actually makes financial sense for someone starting out today.
Because the world has changed.
The price of a degree has skyrocketed, and meanwhile there are trades, tech school certifications
and entrepreneurial paths that don’t come with six figures of student loans chained to
your ankle.
So if you got a kid wondering whether to go and you’re thinking about going back yourself
or you’re just trying to figure out where the smart money move really is, this one’s
for you.
Let’s get into it because Damon, you’ve got an opinion about this.
I’ve got a lot of opinions.
I think a big reason is because I’m going through it right now.
My oldest, we’re going through these live transition periods.
My oldest just graduated high school.
My middle son’s going to be a junior and tomorrow we’re going to the sixth grade promotion
for my daughter.
She’s moving on to junior high.
It just kind of has brought it forward for me because my son’s going to be going to
a local community college that’s what he wants to do.
I want to do this podcast today because I want to let parents know that it’s okay to not
have your child go to a four year degree right out of high school.
You know, I’m almost sound sacrilegious to say something like that.
You got three heads.
You don’t know what the hell you’re talking about.
That’s why yeah, go ahead, but the numbers and the facts don’t lie.
Yeah, and I think that to me, the biggest thing is parents need to be kind of given permission
that it’s okay.
You’re not a bad parent if you’re, we’ve just had this ground into us, even since from
when I was a kid, like your kid has to go to college otherwise they’re a loser, they’re
not going to be successful or whatever and as a parent, you want to do what’s best for
your kids, right?
And so parents just feel like, well, my kid wants to go to school so they need to go to
school and oh, it’s easy.
I’ll just get some student loans because we maybe don’t have the money to pay for it.
And parents, you need to step back and really look at all the options.
And unlike Dave Ramsey’s advice, which she thinks it should be applied to everybody equally,
no matter what it is.
Dave’s way or the highway, college is something that should be evaluated on an individualized
basis.
You know, I’ve got two boys, I mentioned my one that just graduated high school and one that’s
a junior.
Two very different kids, very different interests.
My oldest is more of a, he got a programming mind, he wants to, he’s very artistic.
My middle son is very sports oriented and very likely going to get a scholarship to
go to a nice school with baseball.
And so they’re going to be on two very different paths.
And you have to look at your kid as an individual and don’t just start with the default is, well,
we’re going to college, right?
That shouldn’t be the default.
The default is you graduated high school, what would you like to do with your life?
Well, that’s where you should start.
Yeah, I mean, that’s the big difference because I’m the boomer in this relationship and
the difference is that when I went to college, you could actually pay for it as you went.
And today, we’re asking 17 year old kids to make a commitment to, you know, like a hundred
grand worth of debt that’s going to drag them down for the rest of their life.
And then we rely on schools and their financial aid offices to seal the deal and get us the
loans.
We’re not thinking.
Now, something the Damon I have talked about is this idea of, hey, if you got a 17-year-old
and they don’t necessarily know what they’re really passionate about, what you’re willing
to invest $100,000 in their education for, consider this.
Let them take two years off.
For high schools, the best time to do it, you can still live with mom and dad, but you
can have a purpose.
And there’s a difference in the amount somebody earns over their lifetime if they have a college
degree or they don’t.
But Damon, these numbers are not going to blow your mind, but somebody out there, they’re
going to go, whoa, whoa, what?
Because if your kid takes two years off, they could work.
Doing one of the side hustles, Damon has talked about or working in a store or something
else.
But for those two years, if they deposited just 19 grand each year, that’s after they
paid you rent or whatever, if they could make more than $19,000 deposit that for two
years and let it grow in a stock index fund, it would outpace the difference.
What they would earn by having a college degree in 45 years without making any additional
deposit, those two years of figuring yourself out and making those $19,000 deposits would
be worth about $1.6 million.
Yeah.
How often do we hear that statistic have been thrown around for three or three years?
And it’s never changed when they say college graduates on average earn a million dollars
more over their lifetime than non-college graduates.
Yeah, but there’s a lot that’s been thrown out there for 30 years.
Well, let me give you some, I’m the statistic guy in this relationship also, but I’m the
boring old guy.
Yeah, that’s because I’m the boomer.
You and your facts, Jack.
So listen to these facts.
Only 64% of students who begin a bachelor’s degree program complete it within six years.
The completion rate varies by institution, 63% of public institutions, 68% of private,
and only 29% at the highly marketed for-profit schools.
Only 29% of students that take on the highest tuition get their degree in six years.
33% of all students drop out of college, 41% graduating only within the regular time frame.
So if you factor in the non-completion rates, about 36 million Americans have some college
education but no degree, so they just got the debt and no benefit.
I have so many clients that have six figure student loan debts that don’t even have jobs
that require a degree, and that’s even the ones that have degrees, and a lot of them
don’t even have the degrees, but they still have the debt.
So I know parents, you want to help your kids.
They want to go to this school or that school and their friends are going here and they’re
going to go out of state and it’s going to be fun.
And you look at them and go, okay, I’ll cosign these student loans for them.
And not only are you screwing yourself, but you’re screwing your kids’ future as well,
like what Steve talked about, they don’t even have to necessarily take two years off.
They can go to a local community college if they just don’t want to take time off and
make in every situation’s different.
So we’re not saying no kid should graduate high school and go to a four year school.
That’s not what we’re saying.
We’re saying take a look at your individual circumstance or individual situation, and
maybe undo this thinking that they’re not successful if they don’t immediately leave
the house after high school.
If you want to do right by your kid and they don’t know exactly what they want to do and
have a plan to do it, rather than sign for student loans for them, the best thing you
could do is allow them to live in the house longer.
You know, my opinion 25 should be the new 18 with the way the economy is.
You want to give your kids a head start in life, let them earn money and live rent free
or maybe you charge them some rent, whatever you need to do.
If they’re paying you a little rent, if you’re in a tough financial situation and you’re
got retirement looming around the corner and you don’t have anything saved, allowing
your kids to stay home and work and help pay some of those bills could help you actually
start to accelerate some retirement savings rather than you just putting yourself on the
hook for more debt when you should be saving for retirement.
So you know, your kids can stay home, go to a community college, get an associates degree,
they may have a good idea of what they want to do when they graduate.
They go to a community college, work on an associate’s degree and completely change
their damn mind within two years of what I thought I wanted to do when I was 17 is not
what I want to do now that I’m, you know, almost 20 or whatever, right?
And sometimes they might get that associate’s degree and they realize they’re done.
That’s all they need.
There’s plenty of careers out there that you have an associate’s degree, you’re good
to go.
You don’t need a four year degree.
Yeah, I mean, sometimes experience is worth more than a degree.
But here’s the thing about the degree that often gets missed is that not everybody
that starts completes and the degree, the benefit of the degree is generally obtained
by finishing.
And this fact melts my mind of students that started school but never completed.
And that’s, you know, millions that we’ve talked about after seven years in repayment
for whatever student loans they had, more than half, oh, more than the original loan
because of accumulating interest.
Yeah.
Yeah.
I literally have clients that have been paying on student loans and combination of
forbearance, whatever, for 20 plus years.
Yeah.
And they still owe six figures and they’re, they’re nearing retirement and they’re still
like, how am I ever going to finish paying off my student loan from the early 90s?
Well, you get the, the average cost of attending a four year college in the United States is
almost $40,000 per student per year.
That includes books, supplies and living expenses.
So I mean, that’s a lot of money.
And we know that most students are completing their degree in six years and not four.
Yeah.
Here’s the thing that we don’t think about.
We don’t talk enough about is trade schools or vocational schools.
So the, the average cost of attending that four year school, like almost 40 grand, the
average cost of going to a vocational or trade school and learning a special skill is $15,000
and generally takes less than two years.
And, and you can, you can make $15,000 door dashing while you’re going to school.
Yeah.
You could pay for your whole degree.
Yeah.
You don’t have to, I mean, I think the default should be for parents to figure this out
with their kids.
How do we do what you want to do with no loans?
That, to me, that should be the default.
That, that, that the loan should be the absolute worst case scenario and, and, and it, it, I
don’t want to say never considered, but it should not be the first option.
If you don’t have enough money to think of it like this, would you pay 160,000 for your
kid to go out, out of your pocket, just write a check, forget about the loan, out of your
pocket, would you kind of check for $160,000 for your kid to go to this four year school?
Maybe, you know, maybe if he was going to be a doctor or a lawyer or that was your alma
moderate and, you know, there, there may be situations where that makes sense.
But for most people, you know, you can pay 40,000 to go to this four year degree where
your child can find themselves and, you know, what you want to do while you’re, you’re
spending 40 grand a year or you can say, hey, look, you don’t know exactly what you want
to do yet.
Stay home, save money, earn some money, a couple local community colleges around here that,
you know, my son is going to go to a local college.
It’s less than $3,000 a year.
He’s going to live at a home that, that’s the other thing.
You send your kid out of state, yeah, you send your kid out of state.
So now, not only is the tuition higher, now you’ve got room and board because he’s not
local.
He’s not home.
And then, you know, you might be taking trips out to that college because you want to
visit your kid.
You’re not going to ship your kid off and not see him for a year.
Right.
So these are all things that a lot of parents don’t consider or they say, well, we’ll get
that student loan.
And now the apartment is rolled into that and the, you know, food and all living expenses.
And that’s how these kids end up graduating with, you know, a quarter of a million dollars
in debt and maybe don’t even have a degree of the day and you know, the thing that we
hear most often is, my kids got to go to school because they’ll make more in their lifetime.
Well, let’s look at the facts again.
Men with bachelor’s degrees earn approximately $900,000 more in lifetime earnings than those
with high school graduates, only, you know, high school degrees.
Even typically make $630,000 more over their lifetime.
Now if we can rewind our brains for a second, remember, we started by saying that high school
kid can take two years off and over their lifetime, if they saved that money for those first
two years, they’d have about $1.4 million.
They’d have $500,000 more than that college degree lifetime earning.
And not only that, we’re talking about $1.6 million, but only working at a high school
level type job for two years and that’s it.
And never make it another deposit.
Yeah.
When you’re talking about college graduates earning more or earning nine, that’s earned
income.
Right.
900,000.
And the other thing is, you know, you can, you can find stats to justify any argument
you want.
I would counter that argument with, did they earn that extra 900,000 because of the college
degree or did they, those type of people potentially earn that extra 900,000 because, oh, in the past,
kids that typically went to college and completed their degree have certain attributes that
maybe kids that did not attend college don’t have.
Maybe they’re harder workers.
Maybe they’re more driven.
Maybe they come from more affluent families that make it easier to go to college and those
affluent families have more connections.
That’s true.
There’s a lot of reasons why somebody with a college degree may earn more money over their
life, but you can’t deduce that the only reason they earn more money is because they have
a degree.
That just might be, and they happen to have a degree, there might be other reasons why
they earn more money.
And not all degrees are equal, you know, a bachelor’s in philosophy or English or dance
or, you know, underwater basket weaving, as you always say, is not a high income earner
like engineering or computer science or, you know, something else.
Yeah, like Mike, like I’ve talked about it before, but you know, my son, you know, he wants
to get into, you know, video production and he’s very artistic and that’s the kind of
stuff he likes to do, complete opposite of my sports oriented son that wants to play
baseball 24 hours a day, you know, very, very different goals.
Well, he’s going to be going to a specific community college that has the electives and
the type of classes that he’s interested in because he doesn’t know exactly what he wants
to do, but he’s going to live at home.
We’ve already been going out.
He’s still getting his license.
He doesn’t have his license yet, so we go out together and he’s really into, you know,
more dashing and doing Instacart and it’s a perfect little job for him.
It’s completely flexible.
We’ve got him set up with an acorns account.
He’s got a Roth IRA going.
He’s very diligent about all the money that he earns once a week.
He gets his income.
He puts 30% of whatever he made in his Roth IRA.
He puts his…
And he’s excited about it.
Yeah.
And he’s, he’s bugged because I have to go with him.
That’s the problem.
He doesn’t have his license yet.
So, you know, I’ll be at the end of the day and just exhausted and be like, hey dad,
are we going to go out and drive it?
And I’m like, yes, great, yeah, let’s go.
But he’s also getting his hours behind the wheel to become a better driver.
So we’re, you know, instead of just going out and just driving around aimlessly, we’re,
he’s earning money while he’s learning how to drive and get his license.
So by the time he’s going to college, at the end of the summer, he’ll have his license.
Be driving himself to school.
It’s only about 30, 30 minute drive from the house.
He can live at home, no bills.
And he can do door dash and instacard and Walmart delivery.
And he can easily earn $2,000 a month, super part time.
And all of his school will be paid for.
And then he’ll be building up that retirement account.
So like he said, you know, he can do that easily for three, four, five years until he figures
out what he wants to do.
He got two years at the community college, kind of figured out, get some experience there.
Then maybe go on to complete a bachelor’s degree.
Or maybe decide he doesn’t need that and just get into a specialized course or whatever
it is where, or maybe get into a apprenticeship or something.
At one point, he talked about maybe getting an apprenticeship with Disney, you know, move
out to California.
I got family out there.
He can live with family out in California.
You know, he likes to do that graphic design and all that kind of stuff.
But the point is he’s 18 and we don’t, he doesn’t know exactly what he wants to do.
He would make no sense to send him off to an out-of-state four-year school where he’s
all by himself, all these new bills and now we’re showing out $30,000 or $40,000 a year,
which I’m not going to do that.
So what would you do?
Oh, again, take student loans.
So then if we do that, now he’s 23 and he’s graduated, maybe he’s got a good job, maybe
he doesn’t, but now he’s got 150 grand that he’s starting in debt, that he’s starting out
life-owing versus the way we’re doing it.
By the time he graduates, he’ll have, you know, $20,000, $20,000, $40,000, well, actually
no, have more than that.
He’ll have potentially $100,000 by the time he graduates, if he were a few million.
Yeah, so instead of being 150 grand in debt, he’ll have 150 grand in his investment and
his retirement accounts because he’s been living at home the whole time, you know, basically
mooch enough of us, which if you want to help your kid, that’s going to help your kid
let him mooch off of you a little bit longer, you know, let him graduate with 150 grand
in the bank and then let him go figure out, you know, where he wants to get a job and
then you can leave that money in the account and he will be a multi-millionaire by the time
he retires if he never even thinks about it for the more money.
Yeah, and you know, who makes more money than the kid that took six years to complete
his degree because the school was dragging it on and just cost more money.
The person is making more money, it’s your damn plumber, your electrician, your CNC machine
operator, your robotics technician, they have just they went to school quickly.
They got skills, they got certifications and then they went to work and built experience
that’s worth more than anything else.
You know, 30 years ago, college degree was special, right?
Like, oh, you’re special, you’re going to hurt, you deserve more money and you’ve got
the specialized knowledge.
These days, a bachelor’s degree ain’t special, right?
There’s not the special, what’s special, like Steve said, is the guy that can fix your plumbing,
that can work on your car, you know, get your truck running again.
Now the guys that actually have the old school skills, those are the ones that are in demand
because they’re so, so little of them still around because everybody’s shifted to, I have
to have a degree.
You’re just one of millions with your four year degree competing for the same jobs.
Yeah, especially for your degrees in English philosophy, dance or something like that.
You don’t want to be amongst millions of people with the same skill set competing for
a finite number of jobs.
You want to be in the camp of, there is a lot more jobs, there’s a lot more demand for
what I have than there are people that have the skills to service them.
And that’s why you’ve got your, you know, electrician driving that nice paid off, lifted
Chevy Silverado.
Well, let me give you, I just look these up because I was curious.
So lifetime earnings, so if you have a career this 45 years, lifetime earnings for a plumber
about $3 million, lifetime earnings for a CNC machine operator about two and a half
and for where a robotics technician, $3.2 million.
That’s nothing to sneeze at.
Yeah, and you don’t have to go into a huge chunk of debt just to have a chance at it.
Well, let’s talk about the ramifications of the student loan debt, you know, the people
that you deal with, you’ve had people that have died.
Oftentimes, I remember one story where the debt collector was yelling at this guy over
student loans and you were afraid that he was going to stroke out.
Yeah, I know you’re, yeah, you’re talking about it was actually the grandfather of one
of my clients and they sort of private student loans and the grandfather was the co-signer.
And this collector was just an absolute asshole.
And the grandfather was not in a position to be able to pay it and they didn’t have the
means to be able to pay it, but this debt collector was just relentless.
And the poor guy actually legitimately was on the phone with the collector one time.
And he hung up, ended up, you know, having to call an ambulance, his wife called the ambulance,
went to the hospital, ended up he had a heart attack because of the, like literally hung
up the phone and was like, I’m not feeling good and, you know, went to the hospital, was
having a heart attack.
And of course, you know, I call the collector and raised all hell and they stopped calling
him after that.
But yeah, and it was just, there’s, I think if you go back into the internet archives,
I’m sure you can find, unless my memory is failing me, but I swear back in the day, Dave
Ramsey used to call student loan debt, good debt.
Yeah.
I could be wrong with that, but I think he did.
Now, I don’t blame Dave Ramsey for that because that was the thinking at the time.
Dave Ramsey doesn’t say it’s good debt anymore.
He says the same thing we’re saying, do not get student loans.
Even he realizes, you know, how bad they are, the student loans are not good debt.
They should be avoided at all costs.
And honestly, the ease of which you can get student loans, in my opinion, is what has
taken the guardrails off of this whole thing.
Because if there was no student loans, families would have to get creative.
They would have to really work for it and want it.
They would have to be committed to, okay, my son wants to be a doctor, how are we going
to figure that out?
They wouldn’t just, okay, I’m going to sign here, I’m just going to go to Princeton or
whatever.
Right?
Or you can’t be a doctor unless you’ve got a 5.0 GPA in all those extra credit AP classes
or whatever.
You had to work for it.
You couldn’t just, well, I’m a C student and we can sign this form and I’ll find a college
that will let me in and take my 20 grand a year.
But maybe I don’t have the, you know, really what it takes to be successful.
I’m just, you know, getting by in high school, getting C’s, maybe the person that’s just
getting by in high school, getting C’s, doesn’t mean they’re going to be a failure at
life.
It just means school might not be their thing.
Yeah, get in some space.
Yeah, getting into a four year degree might not be that student’s forte.
Maybe they’re really good at plumbing or fixing cars or whatever and they hate studying.
They don’t like any of that stuff.
So spending 150,000 to force them to do it for six more years is probably not going to
turn out too well.
So the big takeaway on this is every situation is different.
Sending your kid to college right after high school should not be the default.
Getting student loans should not be the default.
It doesn’t mean you’re a bad parent.
It doesn’t mean you’re not supporting your kids.
In fact, to the contrary, I think it means you’re a great parent.
You’re making sure you’re not setting up your kids to fail at life by having student
loans hung around their neck because your kid is 17 years old.
All they know is what they’ve learned in the last 17 years and all their friends are
talking about this school and that school and that party school.
Yeah, the best party school.
Yeah, we’re going to go out on the coast.
So you’re going to be the bad guy.
You know, I don’t think that’s a good idea, son.
Here’s why I don’t think you should.
But that’s being a good parent and allowing them to stay home and stay local for a couple
of years will not only help them in life, but if you’re struggling financially right now
too, especially with debt or whatever, it can help you as well.
So we might need to start getting back to kind of old school.
We don’t think about it in this country as much anymore.
But having extended family, living together a little bit longer, having the family kind
of help each other out.
That’s not a bad thing.
Well you talked about default.
So the largest amount of debt that is owed for student loans is federal student loan debt.
And we had the pandemic and then there was forbearance and then a whole bunch of stuff.
You got kids now that are graduating school that have never made a student loan payment.
And people from beforehand that had a bunch of years off here, but the Department of Education
has ended that gravy train because about 195,000 borrowers who haven’t paid their student
loan bill for at least nine months got a 30 day official notice in May and beginning
in early June are going to start having their wages and everything else garnished.
Now later this summer, the Department of Education said all 5.3 million defaulted borrowers
will get their 30 day notice and then they will get administrative wage carnishments and
start having their wages docked over loans they haven’t paid in years.
Yeah, I mean we’re about, we’re going or five years out from when the pandemic started
in early 2020.
And then so if you back up and so anybody that went into college in 2016 or later, most
of those people because you’re not paying your student loans when you’re in school.
So if you started college in 2016, 2017, 2018, by the time you got out, even some kids
in 2014, 2015, if they were taken six years, by the time you got out, we were in this
pandemic forbearance.
So you got out your loans would have been due and they weren’t and then you had this four
or five years of life of no student loan payments do, right?
So this has been a decade since you agreed to pay this money and you’ve never what happened
while those payments were not due.
Well, they got a couple of years of no interest in the heart of the pandemic, but after that
it started again.
But my point is this, you have essentially a generation almost, I don’t know quite a
generation, but at least what do they call like a millennial and a boomer, they’re not
generations anymore, but what do they call that?
I don’t know where you go.
A millennial and a gen exer, anyway, you got a decade worth of people here that don’t
know the pain of a $1,500 bill for your student loan, right?
It’s something that’s been floating out there, I haven’t had to deal with it.
But now I’m asking and their lives expanded to fill their income.
That’s what I was going to say.
So imagine you graduated school in 2019, you got your fourbearance, then the pandemic
hit and now you’re, what would you be now?
You’d be what, 26, 27 years old, right?
Maybe you’re now married, you’ve got a couple of kids, you’ve got a decent job with your
degree and maybe you’re making $80,000 a year, which is like the new poverty these days.
So you’re making $80 grand a year and you’ve got your mortgage payment, you’ve got your
car payments and you’ve got no savings because you’ve got no money because food is out of
control.
And now, all of a sudden, Uncle Sam’s coming and knocking and your payment is $1,500
a month.
Imagine that.
Yeah.
And there’s another flip side to this because of all the changes that have happened.
There are some opportunities for you to get your loan out of default, out of wage
garnishment, however, and Damon, you can attest to this, the system is now so clogged
with inefficiencies or trying to get someone on the phone or trying to get a rehabilitation
approved or trying to get your paperwork in, is more complicated now than it’s ever
been.
Yeah, it’s a nightmare with all the, you know, the different servicers closing, going out
of business, getting out of federal student loans, shifting over here, all the different,
you know, programs changing with different administration.
One administration comes in, we got all these different programs, different administration
comes in.
No, no, some of those programs aren’t going to go.
Some of them will be fine.
Some of them, we’re going to have different ones.
I mean, it’s, it’s, you don’t want to get in bed with the federal government.
Trust me.
You do not want to be, because you’re, oh, without $1,500 bill, I’ll get on a, an IBR.
Okay, fine.
Maybe you can get on an IBR.
Maybe we cut that payment down in half or something.
Now you’re only paying 700.
You still don’t have room in your budget guaranteed for the $700.
But now you’ve got some deal with the federal government for the next 25 years that if you
pay a certain amount of money that you have to, you know, recertify every single year based
on your income goes up, you get married, you get a divorce, you, you have an extra kid,
whatever it is, every year you got to like, you know, let the government know.
Here’s what I’m making.
Please don’t kick me so hard in the nuts or whatever it is.
And then you’re hoping 25 years from now that if you follow all the rules that they’re
going to forgive the debt, you’re hoping.
And we, we could just see in the last 10 or 15 years how many different programs have
come and gone.
They’ve all changed and gone and whatever.
It’s amazing.
And we’re supposed to make plans based on that.
So you mentioned I’ve had clients that have actually passed away with these student loans.
And I have clients where, and I wish I was joking, but I’m not where they’re in a situation
especially with parent plus loans where we’re essentially putting together a strategy
to minimize or eliminate what they have to pay now so they can maximize their retirement
because these are parent plus loans.
These people are getting ready to retire.
They don’t have retirement.
They’ve been, they can’t afford these loans or never going to pay them off.
So we are trying to strategically avoid payment long enough to where by the time they have
to start paying, they’re going to be on a fixed income.
They’ll be retired.
We want to maximize how much they can put away retirement, which, yeah, we don’t want
to default.
We’re not defaulting.
We’re just, you know, everything is above board with forbearances and deferments and things
like that.
But then the end goal is literally you will statistically, most likely pass away before
you get to the point where the loans would even be potentially forgiven anyway.
And that would save you from having the tax burden of those loans getting forgiven because
you couldn’t pay the damn student loans.
So even if you get it forgiven, now the IRS, again, unless things change will come knocking
and going, okay, you don’t have to pay the 250 back, but that forgiveness was now a taxable
event.
So you’ve got to give us 85, right?
And you’re going to go, I couldn’t even afford the $500 a month payments.
I’m on fixed income right now.
Where am I supposed to get the $85,000 in this forgiven debt income?
So that’s why if you pass away before that event, it’s actually better.
There’s more of it as that sounds from our straight financial standpoint.
I have clients that are like, okay, so if I pass away before that happens, my family,
you know, now the loans die with you, the federal loans, they die with you.
So at least there’s some silver lining that your kids won’t be responsible for these loans,
these federal loans if you pass away.
I mean, it’s ridiculous.
Bottom line is don’t get student loans.
All right, so the bottom line to summarize all of this is before you even think about,
hey, school’s a good thing, I need to go.
We’ve just given you a bunch of alternatives.
You know, is somebody dying in your house?
My freaking maltese, dude, I had to eat you and yell at her, she’s howling.
So the bottom line is, hey, we’ve given you a bunch of
options.
We’ve given you options that can make you wealthy in your kids, your kids wealthy in their
lifetime without jumping first into school, just thinking, we’ll do the math.
And you know, if you ever have questions about this stuff or you know somebody who’s
drowning in these loans, you can always reach out to Damon.
You can find him, d-a-m-o-n-d-a-y.com and Damon can save your ass.
I can save that.
I do.
I’m an ass saver.
You’re an ass saver.
All right.
Well, so to summarize this from your point of view, what would you like to share?
Well I think I already did a pretty good job, but the biggest takeaway for me is parents,
it’s okay to take a step back and really have a good honest conversation with your kids.
College is not just the automatic way to wealth anymore.
In fact, it can be the exact opposite and it’s okay for kids to graduate, take a year
or two off, don’t go to school at all, figure out what they want to do, maybe you know, get
an apprenticeship, learn a trade, get a job, do some door dash, do some instant cart, go
to a community college, live local and save money.
The best help you could give your kids between 18 and 25 is to help them minimize or eliminate
their bills, take whatever money they’re earning and put it away.
That will be more help, that will go much further to allowing them to, you know, become
a multi-millionaire than any damn college degree ever would.
So let me give you an update before I say goodbye.
We did a show, I guess it was two months ago now about acorns, something like that.
And I’ve been rounding up my purchases like we talked about on that show and putting
depositing $50 a week in my account.
And right now starting from zero, my balance is $708 and it’s got a 9% return.
Nice.
And that’s including the Pandelarium, the stock market was crashing and, you know, as long
as you don’t sell, you’re fine.
Right.
Well, we talked about that at the time.
Everyone was panicked because of the stock market and we were saying, wow, it’s great
time to buy.
Get more in.
Yeah.
The market’s down.
Sweet.
Let’s shove more into it.
Yeah.
So, you know, just think of through before you just have a knee jerk reaction about college
is a good thing.
Got to do it.
Yeah.
And I want to tell you one little short story.
So when I graduated from high school in 1977, long before you were born, no, I remember
standing.
I remember standing.
Oh.
Okay.
Well, what month were you born is December.
So you were a college graduate before I came into this.
Yeah.
Yeah.
No, I was a high school grad.
High school grad.
You’re not that old.
Yeah.
No.
I was standing in line at school and over here in a conversation, two kids in front of
me.
So where are you going to go to school?
I’m going to University of Florida.
Well, why?
Oh, they got the best parties.
So that sums it up.
Yeah.
But back to your child.
But in 1977, that kid could have gone to Florida, got a job part time at the damn supermarket
and paid for his degree at the University of Florida.
That’s the difference.
And he could have stood a party in all weekend.
In 1977, for me to go to my local community college was 50 bucks a semester.
I thought you were going to say they would pay me.
Please.
Please come here.
We need students.
All right, Damon.
Until next time, I will see you.
Peace.