The Oprah Podcast - Oprah and Mellody Hobson: Best Money Advice for Gen Z

Episode Date: June 17, 2025

BUY THE BOOK! "Priceless Facts About Money” by Mellody Hobson, illustrated by Caitlin Stevens, is published by Candlewick Press and available wherever books are sold: https://www.candlewick.com/9781536224719/priceless-facts-about-money/ Mellody Hobson, financial powerhouse, President and co-CEO of Ariel Investments and author of the New York Times bestseller, Priceless Facts About Money, joins The Oprah Podcast to talk about the overwhelming financial burdens facing Gen Z today. Oprah and Mellody invite Gen Z guests to share their own experiences and answer their most pressing financial questions. Mellody reveals simple money steps she took early on in her career to set herself up for financial success and offers advice on small changes to shift money habits. Oprah and Mellody speak with young people about working to pay off credit card and loan debt, saving to buy a home, investment advice and the growing trend of high school graduates choosing a skilled trade career path instead of college. Follow Oprah Winfrey on Social: https://www.instagram.com/oprah/ https://www.facebook.com/oprahwinfrey/ Listen to the full podcast: https://open.spotify.com/show/0tEVrfNp92a7lbjDe6GMLI https://podcasts.apple.com/us/podcast/the-oprah-podcast/id1782960381 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello to you, dear listeners. What a pleasure it is to be with you here on the Oprah Podcast. The brilliant Melody Hobson, the brilliant and well-dressed Melody Hobson, co-CEO and president of Arielle Investments is back with me in the teahouse. And Melody has written a fantastic children's book. It's a New York Times bestseller. It's called a children's book, but it's actually for anybody who wants priceless facts about money.

And I think all parents should get this book for your children and also for yourself because I have to tell you, I learned so much. Earlier this year, we recorded a podcast about the book, and if you haven't listened or watched it yet, I strongly recommend that you do. And you know, since I started this podcast last year, Melody's episode is the, of all the people we've talked to, is the most liked episode of all so far.

And since you liked it so much, I asked Melody if she would come back to talk with me. But this time with young people who are a little bit older, Gen Z, maybe you are a member of Gen Z or you have one in your life like I do. And it's in the news every day that this generation has been hit harder by rising prices,

by higher housing costs, by large student loan balances and more overall debt than the millennials before them and certainly our generation. So there's a lot to unpack. Thank you for coming back. Most liked. Thank you for having me. I was very excited about that, but I do like to overachieve.

I know, but I think it's so interesting that a conversation with kids about money out of all the conversations We've had would be the most well received the most like because it's so absent in our society It creates so much fear and I think I've worked really hard to make it to break it down and make it approachable So I think that was part of the reason that it went so well That's what you did and. And when I finished reading this and finished talking to you on the last podcast, I said, Melody, you really should do another book. You should be doing a book for these Gen Zers

that we talked about. I know you got a lot going on, but just think about it. I mean, I actually think it's a service, and that's what we want today to be, a service for you. So why is this generation, why is this generation having so many financial? Stresses well you hit it. The struggle is real the struggle is real So there are 67 million of them ages 13 to 28 just to we can establish that's what we're talking about 67 million of them. So this is a big group of people

They are going into the world with a greater financial burden than the previous generation Before them which would be the Millennials. Mm-hmm almost double the debt of Gen X which is who I am Yeah, and so this is this is a real situation the debt almost double they go into the world with about a hundred thousand dollars in debt and Our generation it was so it is real. It is real. It is not just yeah, it's not in our head It's not made up. They weren't frivolous, but there are things that account for it You talked about student loans in the last 20 years college has cost have doubled in 20 years So that's real. Those are big numbers and a lot of them are taking out loans to pay for that education The other thing you talked about is inflation

Inflation was virtually dead for decades. And it's come back really strongly in the last few years. So inflation, just the cost of living has gone up much more than it was before. And then you talked about housing. We've also seen big changes in housing prices in this country. And so that has absolutely affected them. As less homes get built and there's less inventory, houses cost more. And that is something that has actually happened.

And you've seen that starting during COVID, where everything in terms of new homes being built slowed down dramatically. And so a lot of young people are actually changing their attitudes about home ownership, which traditionally was the American dream. But what a lot of people now feel like they can't. So they still want to own a home. It feels a little bit further away. And that has actually proven to be true.

Again, the data. Yeah. I always like to say math has no opinion. The first time home buyer, average age right now is 38 years old. Wow. That is 10 years older than Gen X. Wow. So we were buying homes in our 20s,

they're buying homes in their 30s, living with their parents longer, renting longer. And so there is actual data to show that American dream, that home purchase is further and further away. Here's the other thing. You're right. It is real. It's a real thing. The average age of a homebuyer today, average, is 56 years old. What?

Yes. So I thought about that from the perspective of you're 56 and you have a 30-year mortgage. Wow. Right? Yes. The average age is 56 years old right now. So these are real things, but the first time homebuyer, which is, you know, what they want to be, the average first time homebuyer is 38. So this has gotten away from them.

The home purchase has been delayed. I still think that it doesn't mean that it's deferred, not, you know, not something that will be denied. OK. Deferred, but not something that will be denied. Okay, deferred but not denied. Yes, exactly. But I think just hearing, and I know for many of you, just hearing that it is real, it's not in your head, it's not made up, it's not the lazy generation,

it's statistics don't lie, math doesn't lie. Yes, yes. So what are the biggest mistakes this Gen Z generation is making financially, do you think? Well I think there are a couple and these mistakes are the same old mistakes. I wish I could say they were new, they're not. They're repeating the mistakes of prior generations. And some of those mistakes are everything from- And can less afford to repeat those mistakes, don't you think?

Can less afford it. Correct. That's a really, really excellent point. So one example is just the debt, the credit card debt. Now, the credit card debt is higher, but even if you adjust for inflation and even adjust it for inflation, it's 25% higher than the previous generation. So credit card debt is higher, but that cycle of multiple credit cards, of paying the minimum payment, this is a lifetime of debt. And just convincing them that that debt, that they have to break the cycle on that debt in terms of the number of credit cards they have, as I said, paying the minimum.

I bought props for you just to see, my own props. This is my life. Green, not fancy. I used one card. I used one card and then my Chase debit card and that's it because I don't want any balances. Now you don't want multiple, multiple, multiple, or paying interest on debt. Yes. I don't want to pay. So, you know, to the extent that everyone, and I know this is impossible for everyone to buy something and pay it off,

it is absolutely the best way, so you're not carrying that debt. But if you have to carry debt, do not just pay the minimum. Even a few dollars can make a difference. $5 more, $10 more than that minimum payment can take years off of debt, literally years. And so that minimum payment trap is something I'd like to see stopped because you see something

and you think to yourself, oh, the minimum payment is only $20 on this thousand dollar purchase or whatever it is. You're going to be paying the rest of your life. Years, eight, nine, 10 years. Yeah, wow. I hear a lot of Gen Zers saying going to college was a waste of their money. 51%. Are saying that.

Yes, 51%. And what do you want to say about that? Was it? It's the best money they've ever spent. There is good debt and there is bad debt. I consider education good debt. And even though it costs a lot and that student debt can be with you for a long time, I want to start with just the

fundamental idea, which I know you will agree with. You are learning. And that is something that people can never take away from you, ever. The gift of an education is something that is a gift that keeps giving. And so I really want to make sure we understand the most fundamental piece of it.

And I think the smarter person goes through life with better decision-making, better socialization, I could get through all the things. Better discipline, better discipline. Exactly. Having to achieve something like a degree. The worst thing you can do, worst, you go to college, you take on student debt, and you don't graduate. That's

the kiss of death. Because you don't have the degree and you have all the debt. It'd be better not to go to college. Because in that situation, you don't have the debt. But if you go and you fall short of the degree, it is a- Now you don't have the degree? Correct. Now here's the thing about the degree. There is a direct correlation between how much education you get in the society and how much money you make. So if you graduate from high school, you make one amount. You graduate from college, you do make more.

You get a master's, you make more than that. This is just a fact. I can show you this across all sorts of of field however The gap isn't as wide as it was before and some some other areas like trades The trades jobs also because of scarcity that we've had in this country. They're making really good living Yeah, we're gonna talk to talk to some people during that without going to college So I just want to say but even to but even to be a member of a trade, you have to have some education. That's right.

Certification. That's right. You have to apprentice. There are things that you have to do. So there's still an investment that you have to make in time. And oftentimes, money. It just may be different than a four-year degree. But I'm just going to tell you another example of just why

this education is worth it. If you just look at unemployment statistics today, now we have virtually full employment in this country at 4%, meaning most people want to work due. If you have a degree, that unemployment number is under 2%. Right now, because we have virtually full employment, it doesn't seem like a big deal, but when you start getting into periods where people are losing a lot of jobs, the person with the degree is more likely to work.

It's a fact. That's why it's the best money ever spent. Truly, to me, I really mean that. It's a lot of money. And I've had student loans, so I know, you know, I'm not sitting here from a perspective I don't know what people are talking about but I can tell you I Aggressively paid them off aggressively and I felt feel like that education gave me a lot of opportunities Yeah, I think a lot of people say that because they think going to college you're going to college just to get a job

But what you just you make clarified, I mean, I got it like a, aha, you're learning. And you're not just learning about how to get out and get a job. It's expanding you. The four years you bring so much to yourself. Once I did a commencement address for on money. And I said, the thing about it it I researched all these commencement addresses and No one ever talks about money, but I said most of your parents think you're here to get a good job That's right

But there's no commencement dress of the address on the facts of what you're the situation you're in and what you're confronting It's super interesting because this whole concept of money is such a taboo concept in our society Even though I joked in the commencement address, there are plenty songs about money. Yeah. But we don't talk about it. That's right. We can think about it, but we don't talk about it. Don't talk about it.

That's right. And so this whole idea of education, I really do think it's gotten a bad rap. And I understand why, because the costs of an education have far outstripped inflation. The cost has grown faster than inflation. So people feel it's moved so fast and so far. They feel that they've been taken advantage of. Well, that's why I thought that priceless facts about money that you did for learning how to talk to your kids about it

and sharing interesting facts about money was so vital, mainly because, as you and I know, most people grow up not having any conversations about it. It's like there's this, I don't know, stigma, shame around it. You know, my father never discussed it and just said, never have any credit card debt. You know, you never wanna, never buy anything.

When I was growing up, it was called layaway. Never buy anything on layaway, don't have any credit cards but Never really an understanding about money. So to start that conversation early and what I really think is God knows this should be taught in schools It should be taught in schools. Don't you agree? Absolutely, the state of Maine bought the book for every elementary school student and I thought about 13,000 books I thought it was such a genius idea. And I applaud them for doing that.

Um, because I do think it's a powerful tool in the hands of a young person. And it is something that is really life-changing once you get rooted in both the comfort of the conversation and the actual actual subject. Cause a lot of kids, as we're going to find out today, people who never had a conversation about money. Listeners, I know how much you value your time and your money. So I thank you for spending part of your day here with me and financial expert Melody Hobson on the Oprah podcast.

Melody's bestselling book is called Priceless Facts About Money. When we come back, she's taking questions from Gen Z, a generation facing unprecedented financial obstacles in today's world. Melody has some great real world advice that is coming up next. This message is brought to you by Apple Card. Apply for Apple Card today and start earning up to 3% daily cash back on everyday purchases. And that daily cash can even grow automatically when you open a high yield savings account through Apple Card. What are you waiting for?

Visit apple.co.slash card calculator today to see how much daily cash you can earn. Subject to credit approval savings available to Apple Card owners subject to eligibility savings and Apple Card by Goldman Sachs Bank USA member FDIC. Terms and more at applecard.com. Welcome back to the Oprah podcast. I invited Melody Hopson back to share some crucial financial advice, this time for Generation Z. From student loans and credit card debt to paying rent, and if those buy now pay later deals, are the right choice. Melody has smart financial answers, so let's get back to it. We have Jinzy zooming in with questions for Melody. Kayla is joining us from California. I hear you've been, what, nodding along with this conversation. Tell us what's going on

with you. Well, thank you so much for having me. And I have been everything that Melody is saying and everything that, you know, just is being said. I'm just like, yep, definitely, definitely something that I agree with or I'm experiencing right now. What's your situation? Tell us what's happening. Well, I mean, my situation kind of all started when I graduated nursing school in the height of the pandemic in 2020. And that was already a struggle in itself. But I think I kind of

dug myself deeper into that hole with the use of credit cards because it was difficult to start off with no job, with no nursing job, trying to find a position. And that kind of just spiraled into maxing out those credit cards and just, and to the point of maxing out those credit cards, the total of 20K, not including the student loans that I have from nursing school. But I think I just hit that peak of my money situation when it came to the point that I wasn't able to pay for even just like a $5 meal, like a fast food meal.

And I was even utilizing those buy now pay ladders, which is what layaways are called now. I was utilizing those for groceries. So I knew I had to change something. And so I kind of held myself accountable. You knew this when you couldn't pay for lunch. You knew this when you couldn't pay for lunch. Yeah, it was literally just a lunch that I had,

that I wanted to get for myself during work. I wasn't able to do it. And I cried that day. It was, I knew when I cried for that meal, I knew that was my breaking point. And so... Are you doing the thing, have you been doing, Kayla, the thing that Melody just said don't do? And that is making the minimum payment on your cards, just the minimum payments? Yeah. Yes. I, since 2020, I've accumulated about five credit cards and since then I've been just

doing the minimums and I just recently actually calculated all of the interest that I was paying over these five years and yeah. What was the number? I can't remember on the top of my head but combination of everything was 5,000 plus. Wow. Wow. Yeah. So, and that really like lit a fire in me.

Isn't that interesting because most people, I mean, that's why everything I was nodding to everything Melody said, because you don't think about it. I remember when I first came out of college and got my first credit card, I was so excited. And you think only 20% minimum, only 15% minimum payment, and you think, oh, well, that's not so much. And then you get three or four credit cards. And before you know it, you have so much debt, you don't see how you're going to get yourself out of it. Yeah, it just ended up being a whole snowball effect of using all of the credit cards. And I think putting it all on paper in front of me

and seeing all the numbers in front of me, I think that's when it clicked and put me back into reality of, we need to do something about this. So what's your question for Melody? So my question is, with me now paying off these credit cards, I have paid $5K out of the $20 so far. It is also very difficult to maintain just the lifestyle and if there's any emergencies

that happen, I don't know if I'll have the money and I have about $5K that I've already paid off from one of the credit cards. I don't want to result back to that. So my question is, how can I continue to have this progress of paying my credit cards off, but also have a good cushion with an emergency fund, doing this all at the same time? Okay, well, I think you're going to have to prioritize. I like that you have really gotten clear about your situation. I like that you put the bills in front of you.

One of the disadvantages that, to the bills in front of you one of the disadvantages That to the great advantage you all have as being digital natives is that because you are digital you can avoid a lot of the reality by not, you know, just having the piece of paper in front of you and checking and Tend to pay digitally you tend to you know Go through that life that way. So the first thing I would say that I would want you to do is I would want you to pay off the most expensive debt first.

There's a saying that it's very expensive to be poor. The less money you have, the higher debt, the higher interest rates you might be paying. So get rid of the ones that are the highest interest rates first, because trying to save against those interest rates you might be paying. So get rid of the ones that are the highest interest rates first because trying to save against those interest rates gets very hard. It's like having a bucket with a hole in it.

Something's leaking out even though you're filling the bucket with money. So you want to get rid of those high interest rate credit cards first and really be deliberate about it. So you might, you maybe have paid 5,000 so far, you might say, I'm going to get rid of this one totally first and still pay these minimums. Does that make sense?

Look at each by the interest rate they're charging you and be very clear about that. And you have to be extremely disciplined about not restarting. So once you clear one of those cards, you're going to have to be ruthless about it, that you don't start again, because you see that zero balance

that might be sitting there. The second thing that I think is really important is a little bit of savings can go a long way and become very, very addictive. So I'm going to ask you to do something that is going to seem so small, but every dollar does count. Like the show The Bear, they say every second counts. This is every dollar counts. Start by saving

50 cents a day for two months literally 50 cents You can have a jar of change but 50 cents a day in that jar after two months. I want it to be a dollar I know this seems like so, you know melody. What are you asking me to do after two months? I want it to be three dollars Okay, and after the in the last four months, I want you to try to save $5 a day. Now $5 a day, we're talking about $35 a week. We're talking about $140 a month. That gets hard. But in those early days, you start to condition yourself around saving. I love this because you've trained yourself.

And this becomes a way of life, not a diet. It's very, very important. It just starts to be a way of life and saving becomes addictive. So everyone that I've had do this, they see a little money, they get excited. They start to see more money, they get more excited. So that- I love this. This is so much, but everybody will say save 10% of your salary.

No, it's too hard It's too hard eating 50 cents a dollar two dollars three dollars five dollars at the end of that year You have almost a thousand dollars And that's a little cushion and it's you didn't start by saying I got to save a thousand dollars Which when you're you know living paycheck to paycheck that seems impossible But if I start you at 50 cents, I promise you can get there The other thing I'd like to ask you to do for one month period 30 days. We guys 30 days Is just use cash for one month?

Okay, you cannot use anything else. This is why it's important If I ask most people how much money do you have in your wallet? People can't even tell me If I ask most people how much money do you have in your wallet people can't even tell me But you'd know if you only had cash and so you only use cash Which actually changes how much you spend believe it or not when we don't see and have to take the bills out, right? We spend more money. So we spend about 18% more on plastic debit or credit Because we the scarcity isn't there where you're You literally have no more bills in your wallet. You've got to go to an ATM and get more money. Cash for one month, it is going to shift how you think about what you buy.

Starting today. One month. Today. Okay, starting today. That's on the to-do list now. That'll get you a little bit of an emergency fund, but I want to prioritize that debt first, because $15,000 in debt at your age is still a lot of debt. Yeah, and that's not even including because I have my student loans and I'm currently

in school right now along with like a car loan. So it's- However, I have to tell you, first of all, you need the car to get to work. So that's essential, probably, unless you're going to take the bus. The other thing I have to say, and sometimes there isn't public transportation in certain communities. take the bus. The other thing I have to say, and sometimes there isn't public transportation in certain communities, the other thing I would say, you nailed it with nursing because it's so in demand. That is a really good job and that is there's a shortage of nurses in this country and there will be a for a

while and so you're gonna be looking at great income in terms of nursing. Yes, definitely. I'm very proud of where I am, so I'm very grateful. So good job there. Good job. Thank you. Thank you so much, Kayla. Thank you so much. Let's talk about the Buy Now, Pay Later services that Kayla mentioned.

What should young people know about these services? Okay, this is what makes me nervous. Okay, on the one hand, I can tell you that they have these Buy Now, Pay Later, well, they'll say a year without interest. You're going to buy it. No payment for one year, no interest. Sounds good. Enticing.

If you can be very disciplined about that. So you're going to buy a refrigerator and you're not going to pay interest for one year. Basically the float that you, the interest they're paying for in order to get you. But what happens is most people aren't that disciplined. The interest then comes and then it starts hitting you very, very hard and the numbers are very big. That's why I don't love it. So if you said to me, I bought the refrigerator, I paid it off in six months, I never paid

a dime of interest and I paid the refrigerator off full stop, we're good. But if you say I bought the refrigerator, I got to the one year and then I started to pay the interest, I could promise you that interest is going to be very high, then you're going to be in that minimum payment scenario. There's a reason they offer it to you. They're getting paid back some way and they're going to get paid back in that interest. The reason they're offering it to you is because they're counting on you going through that year and then waiting and they can pay you back.

Correct. I'm not a big fan. Okay. We have Madiha joining us from Boston. And I hear after you graduated last spring, you applied for over 300 jobs. Wow. What happened? Well, thank you so much.

It is a pleasure speaking with both you today So taking you back last year after I had graduated I was applying to jobs like nobody's business and I was able to get interviews however, they differed from what I had applied to so In a handful of circumstances I would get on these interviews. And it wasn't just the interviewer and I. It was myself, them, and a handful of other applicants. So that wasn't disclosed. And then when they started describing the job positions,

I realized that it also differed from what I had applied to. So I had applied to a marketing position online. And what they were describing were door to door sales. So this happened in multiple different occasions. And then there were also times where I was asked to do work projects as a part of the interview process. And these work projects were unpaid and they would take hours or even days to complete. And it may have been naive on my part. You know, I really wanted to prove that I was a solid applicant

and that I had the skills for the job at hand. So after turning in these projects, I was ghosted by a lot of companies. So that was very discouraging and disheartening. There was one circumstance where I was the top applicant. I made it to a final round. I spent a whole week working on a work project. And they had told me all great things.

So about a week later, I got a call from the recruiter. And he had simply told me that they went with another applicant who had more experience. And so that just kind of hurt, as it was an entry level position. And I had completed a lot of the work. I ended up asking the recruiter for more feedback. And once again, I was ghosted. So with all of that said, I have come out on the other side.

I have a job now. But I know that my story is not unique. There are so many other people in my generation and in others who are experiencing this, or even worse right now. And I do believe that my generation was raised on the premise that the American dream was still within reach. That if we ended up going to college and obtaining a degree, that we would be able to get a good job and set ourselves up for success in the future. And with this job market, I just feel like that system is no longer as accurate as it once was before.

So my question for you, Melody, is what advice would you give to my generation when it comes to building a stable and successful future while maintaining a healthy work-life balance And really just not living paycheck to paycheck Okay, can I ask one question? How did you get the job that you have? I Had a networking connection and I really do believe that if I didn't have that connection, I very well could still be job searching. Okay, great. Because that would be one of the things

that I would suggest, just in terms of that job search. It's not just about putting applications in online and hoping someone calls you back. I think that takes the same amount of work as anything you would do, and it's about, who do you know? So many people have referrals that will get you somewhere, and the mere fact that it was a networking connection, I think that's more and more likely these days than not.

You might have a friend who has a great job and you would say, do you think there are any jobs available at your company? Or is there anyone you could introduce me to at your company? So I think that is a really, really good option if you're looking for a job that maybe everyone doesn't think about because they often think, well, who's going to help me? And how could I, what network do I have? But it could just be a simple network of someone that you know who talks about their place of employment in a very positive way.

In terms of, I like to just be very authentic and real about these things. When you're in your 20s, the work-life balance question, I think, is going to be challenged because those are heavy, heavy work years of trying to put in the time to get points on the board so that you have the opportunity to have the kind of freedom and success that you want over time. But that first decade, it's a dues-paying decade. And so when I hear a nine to five, which seems to me pretty work-life balance, that's 40 hours a week, when I think of no work-life balance,

I think of 80 hours, I think of 120, I think of a very different lifestyle. I think you have to ask yourself very, and be very intellectually honest about what do you want. So you can't have all of the things you want without making some trade-offs And you certainly can't have it all at one time Correct. I think this is such an Invaluable point you're making about work-life balance and I hear this a lot because I have girls in their

20s and you don't have work-life balance when you're just starting out and you're 25 You you there is no such thing. There is no such thing. Someone else controls your time. That's the fact. That's it. When you think of your 20s, how hard did you work? I was working a hundred.

I remember once filling out my time sheet and I had 107 hours on, 107 hours. And my boss says, well, you're not a team player. I'm not a team player. Yes, I think you should reduce the number of, wanting me to not even take credit for the hours. So I ended up doing that. I ended up only putting in like 80,

because to work 107 hours and get paid for 107 hours, they didn't want to pay me for 107 hours. But the expectation was that I would show up and be there whenever needed. We've all done that, 107 hours. Still doing it. And still doing it, and still doing it, but. Yeah, but that's why I said you have to decide.

I thank you for listening to the Oprah Podcast. When we come back, bestselling author and money maven, Melody Hopson shares the simple steps she took early on in her career to set herself up for financial success. These are easy money saving moves you can make right now. We also have more financial questions from Jen's ears who worry about paying off debt and also how to save money to buy their first home. Melody Melody

It feels like all the odds are against me right now because I have so much on my plate. Melody Melody's advice on how young people can make their own version of the American dream come true after this quick break. This episode of the Oprah podcast is sponsored in part by NetSuite by Oracle. What does the future hold for business? Ask nine experts and you'll get ten answers. Rates will rise, rates will fall, inflations up or down. Can someone please invent a crystal ball? Until then, over 41,000 businesses have future-proofed their business with NetSuite by Oracle, bringing accounting, financial management, inventory, HR into one fluid platform.

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So glad you're with me here on the Oprah podcast because we're talking about something I know is essential to every person. Money. I am here with financial powerhouse, Melody Hopson, author of Priceless Facts About Money. And whether you're a parent or you're a young person yourself, she is here to talk about the financial obstacles Gin's ears are facing today. Melody has advice on how a simple shift in your money habits can make a huge difference in your bank account. Let's get back to our conversation. I do think this generation has been fed some dream idea

of work-life balance. That just isn't real in your days. It's not real. Now that I also, I reject the concept because it implies when you're working, you're not living. When you're living, you're not working. You know, when people talk about that. And I think you can have both,

especially if you were doing something you really enjoy. But I do think this idea of thinking that you'll have your weekends, you'll make a great living, all of these things all at once. You'll have a job that you love. Those early years are, as I said, those are hard, hard years for most people. And they continue to be hard years for people.

I have a joke with my husband. He's getting me a time clock because he says, you know, I work some of the hours, I punch in, you know, and I don't punch out. But I do think that that is something to keep in mind. The other thing I would say to you is, in terms of feeling, you know, financially secure, I think the question that is something to keep in mind. The other thing I would say to you is in terms of feeling financially secure, I think the question that you have to ask yourself is about what are your goals?

People, knowing early on what that means to you, then you have something to drive for. So I want to give you a very specific example that was me. I started doing my job and I just thought I was putting money in my 401k plan at work. I was starting off maybe putting away a couple thousand dollars a year. No, you know, a couple hundred dollars a paycheck kind of thing, maybe a hundred a paycheck,

which seemed like a lot to me. Just, you know, I made $38,000 a year. That was how much I made, so it wasn't, I wasn't making a lot of money. I had this goal of ratcheting up how much I saved in my 401k plan because I had one goal. One day I wanted to see that I had a hundred thousand dollars in my 401k plan. Wow. That was my goal because I did the math on over 25 years if I confounded a hundred thousand dollars

would I have millions of dollars? And the actual answer was yes. So I said, I'll be a millionaire in retirement if I can get to $100,000. But I had a goal. With compounding, yes. Yes, with compounding. So just having a goal of what is it that you're trying to accomplish, and it can change. Do you want to retire at a certain age?

Do you want to have a family at a certain time? If you could establish that goal, then you can financially start to plan for it and work towards it. And if you say, listen, I want to work 40 hours a week and I want to surf on the weekends, just understand what that financial trade-off is. And some people are absolutely willing to make it. And I have no judgment on that at all. None. Has this been helpful?

Is this helpful? Very helpful. Yes. It's, it's the goals need to be set for sure. I think it's just a matter, you know, I'm a recent graduate, so you live and you learn and you go through it. And I think it's, it's just the fact that a lot of other people are going through this and it feels very real

So that was great advice and it's also just keep in mind that the mere fact that you're feeling a little shaky and unsure About this it makes a lot of sense You're not you know, this is you go into the deep end of the pool now when you know adulthood becomes upon you It's you are making your own life decisions and the safety net starts to go away of the family that you've probably, I can't say for sure, have had there to help take the edge off. Yes, yeah, absolutely. I've been lucky enough to be able to support myself

for a while. So I do have a taste and a feel for what that's like. But I know a lot of other people are just entering into that world as well. So it is still, you know, you just got to persevere through it and push through it. Good job. Good job. Thank you. Thank you so much, Madia. Next up is 26 year old Alexandria joining us from California. And I hear you moved in with your parents after graduation to save money. So many people can relate to that. So tell us your story.

Okay, well, first off, I'm so blessed to be a part of this important conversation. It means a lot to just sit here with admirable women, especially while I'm trying to get things together financially for the first time. So I'm 26, I'm living at home. I'm a labor and delivery nurse. I previously got my bachelor's in nursing

and then I have another bachelor's in psychology. So that comes with a lot of responsibilities and now this is like my first big girl job. And so I'm having student loans, credit card debt, wanting to save, budgeting, learning. Now things are in my name, like my car, my parents were helping me at one point during school. But it's so much.

And I was watching the previous podcast with Miss Hobson, and it was just, she said something like, it's scary to make financial decisions. And that's how I'm feeling. And it really hit home for me. So school, it has never set me up for that. Like it never taught me about credit. It never taught me about investing or budgeting and what I can do. So I feel like I'm just in this space where I'm overwhelmed because now I have all these student loans accumulating and then it's like, wait,

I applied for this much. why is it this much now? And it's like the interest and you know what is consolidation and just understanding subsidize and unsubsidize like it's so much and I'm still trying to like help around my house too. That's why Melody should write that book I'm telling you but anyway. Oh my gosh so it's hard and it's just I feel like even me wanting to own a home eventually, it seems so far out of reach. So I guess my question would be for someone like me who's trying to achieve financial security and stability and even home ownership, like eventually, what steps can I realistically take to get there when it feels like all the

odds are against me right now because I have so much on my plate? Just even paying my debt off, what's the right steps? Okay, so first of all, the first thing I would say to you is it's a lot, but it's also generations have done this before you. This is a part of life, and the best thing that you could do right now is to calm your fears by taking one piece at a time. If you think of it all at once, you're going to be overwhelmed. It's like a storm.

But if you take one piece at a time, I think you can start to dissect the issue and take control of it. So you've got student debt in one bucket. You've got the, you know, just your living expenses in another. You have the benefit of living with your parents so you're not paying rent or mortgage right now. But that's going to give you a lot of opportunity to save for that down payment for that first house, which could become part of your goal.

So the first thing that I would do if I were trying to really understand the situation and get it under control, what is your nut? What does it take for you to just live? Like where you haven't done one nice to have, you've only taken care of the need to have. You got to pay the student debt. You've got to pay the student debt. You've got to pay the car payment. You have to contribute to the house some amount that you've negotiated with your parents.

What is that number before you've done, bought a lip gloss or, you know, gone out for a hamburger? What is that number? I think you understanding that if you do, that's great. If you don't, you need to understand that Then when you look at that against what you make you can start to figure out what things can you start to now? Be very intentional about like the debt Consolidation you mentioned that

One of the things you might do is say I'm gonna going to consolidate all of these loans around one payment, one amount. The maximum consolidation for the federal student loans interest payment is 8.75% right now. Now, if you have bank loans, that's a different story. But you might want to consolidate those student loans. The thing is you can only do it once, as you probably know. You might consolidate those student loans just to also not have all these different things coming at you from different places

Which feels overwhelming and you're down to one loan that you're paying and then you decide maybe you might want to accelerate that payment So that you can pay it off faster But if your credit card debt is 15 or 20 percent, I'm going to tell you pay off that credit card debt first So looking at the pre credit card debt, that's something you have to pay. And I've just said to you, don't pay the minimum. So if you're not paying the minimum and you're accelerating that, what does that number look like? Understanding that budget, which is just really the most important thing you could do,

then lets you know how can you achieve the other goals that you have. But you've got to start with what you're paying today. Then you're gonna get raises, you've got such an awesome job. If I could deliver a baby every day, that would be so much fun because I love babies so much. So you've got this awesome job,

you're gonna do better over time with tenure and seniority, you're gonna make more money, it won't all be static of where you are today. So there's, instead of being behind the eight ball, you've got so much ahead of you, so much opportunities, so much income that you will earn. You're not stuck. You're just starting.

You're not stuck. You're just starting. And so if you can think of it that way, I think it'll make a very big difference in your mindset. You're like every other 20 something, your age, trying to get control of this situation, because sadly, and this is the thing that I'm most upset about in our society,

no one teaches us. I've said that over and over again. How would you know? No one in school has taught any of us any of these subjects. And if you don't live in a house where your parents talk about it, they may not know either

because no one taught them, you know, you're really behind the eight ball. So you're just going to take it upon yourself to now take this in hand, but you're going to start by understanding what you're spending. Yeah. And I think understanding too, Alexandra, that everybody is in the same position as you trying to figure it out. So you're feeling overwhelmed and you're thinking, everybody else has it figured out.

They don't, they don't. Everybody is trying to figure it out for exactly the same reason that Melody just said. Because nobody gets taught, yes. She's also in a good situation. I mean, you've got the, to live with parents. Once you get this budget under control, you could start saving for a home.

You know, because you're not paying the full rent that you would be paying. I mean, over time, that's gonna work in your favor. And I know you don't wanna live there forever, probably. I'm thinking I kinda wanna get an apartment or something because I've been here for a while, and I'm 26. I want to build. So maybe you get a roommate.

You know I say this to people and they're like a roommate. I'm like that's the way most people started their lives. They lived with a friend. Right. They split the rent. They split all the expenses and that just that makes it easier. You know yes there's another person there. Find someone that you like hopefully.

But it does make it easier. You know what I'm just saying a roommate to someone, people get offended sometimes when I say that. I'm like, but that's a perfectly fine solution. You know, something that people don't do much anymore. You talk about carpooling. These were like, you know, oh, they split gas. Yes, yes, yes. You know, these things are, you know, they're not so bad.

And they help you actually save money. And also, did you hear previously what Melody was saying about saving 50 cents a day, then saving a dollar a day, and then I just- I've actually not. I've been saving my checks since I started working. I started in February, so I've been saving as much as I can. And even if there's a little bit, you know, in my checking, I started in February. So I've been saving as much as I can. And even if there's a little bit in my checking, I'll take that at the end of the month

and put it into my savings. So I've really been trying. And just- That's really great. You know, the other thing I tell people about savings is, most people eat out at work every day. They grab a sandwich or whatever. I was like, just one day a week, take your lunch. You know, it's 10, 12, $15. One day a week. It's $45.

Thank you, Alexandria. Thanks for joining us. Thank you. Thank you so much. I appreciate it. Thank you. Good luck. You're on a good path, really. Yeah. That means a lot. Thank you. And I'm definitely going to take that advice. I'm not just saying it. I'm a hard grader. Thank you. I appreciate it. I love what you said earlier too, Melody, about this period in the 20s. It's like you're

putting something in the game. I forgot the term you used, but it's like you're building for the future. Yes, exactly. Yeah. Yeah. And it's something that I think people don't realize, that you have to get started and you're getting started with debt on you because of the education or just the life, you know, being what it is and just being as smart as you possibly can about how you handle that in the beginning. And we all make those early mistakes.

So I remember when I got my first credit card, I was at college at Princeton and my friends go on this ski trip to Aspen. Now, I am not Aspen ski trip money people, okay? Let alone I've never been skiing. You need all the gear, the ski passes, et cetera. It's maybe one of the most expensive sports. This is true. I went with my friends, all in $2,000. I have no money and I put it on a credit card and I said, I'll just pay the minimum, but

then got behind and bill collectors were calling me at school. So I'm freaking out. I am in so much trouble, embarrassed to tell my mother because we've been to this movie, in my family of not being able to pay our bills. I can't believe I've done this. It literally seared me. And the only way that I ended up paying for it, and I cannot believe I'm telling you the ending,

my aunt died. And it was... And she left me $2,000. Oh, my goodness. Is that the craziest story? Yeah, yeah, yeah. I mean, which is I didn't obviously want her to die, but she was so proud of me being- And she left you exactly $2,000?

I swear on my eyes. And I was like, from heaven, she was saving me from this horrible credit card bill that scared me so much that I- And then did you course correct it and not do it again? I swore, which is why all of this became so hardwired in me, I would never, ever it and do it again? I swore, which is why all of this became so hardwired in me, I would never, ever, ever do that again because I was so stressed.

Wow. I know the skiing thing. I had multiple family members come for skiing, and by the time everybody's boots and coats and ski instructors... It was a very bad idea. It's a lot. It's a lot, I should have opted out of that one. That's right. Yes, you should have gone hiking. Only shoes. Or walk around the block. Yes, skiing is a lot.

We're gonna take a quick break, but stick around because Melody Hopson and I are about to talk to a teenager and a teacher about the growing trend of high school graduates choosing the skill trades over college. If you're a parent or a student, you'll want to hear this. Melody also has some fantastic advice on investing for young people. We'll be right back. Hi and welcome back. Thank you for spending part of your day here with me. I'm with best-selling author and financial expert Melody Hobson, who's talking about the financial squeeze young people are worried about, especially in Gen Z. Next, we're talking with a young man

who is joining a growing trend we keep hearing about, the choice to work in a skilled trade instead of going to college. Let's listen to what Melody has to say. The Wall Street Journal recently did a story about this growing trend that we were talking about earlier of young people choosing the skilled trades over college, even calling Gen Z the tool belt generation.

The article featured Father Judge High School in Philadelphia, which is an all male Catholic school. And we gave them a call and joining us now are the welding program instructor, Mr. Joel Williams, and 18 year old senior, Marcos, from their shop class at Father Judge. Hi there. Hello, hello, how are you? Hi. How are you? Great to have you both here. So you've opted not to go to college Marcos I hear and instead are pursuing a trade. Why did

you make this choice? I made this decision for a couple of reasons. One was when I was in grade school I was always in like the honors classes. Even at Judge, I was in the honors classes, but studying, it took a while for me to memorize stuff. I just was never the best memorizer, so it came hard. And then looking at high school and even college, I wasn't sure how that was gonna go. And I thought about that, like for my future. But then I came to judge at an open house and I saw the welding program for the first time. And I saw an opportunity to be successful without having to go to college. Also, I always thought student debt, student loans for college, that that was going to be a lot. I didn't want to go into that. And I saw welding as a way to get past that.

Another reason is because I'm very hands-on. I love building, I love creating, and welding was a way I could make that into a career and be successful as someone that went to college and be making the same as them or even more. So you enjoy welding. You actually enjoy welding. Yeah, you like it. Yeah, I do. That's a big bonus. Mr. Williams, tell us about this program and

why it was started. This program was started because there was a definite need and a deficit of welders. There are so many people retiring, but there's not enough people to fill the void and all the blue collar jobs. So the Archdiocese had a couple of meetings and they thought about bringing the trades to the Archdiocese. So they chose welding and then in a matter of months they decided to build a welding program here at Father Judge. And this is a three-year program. Two hours every day for three years these young men come to my class. We learn how to read blueprints. We articulate blueprint symbols. We learn how to draft symbols. We

talk math. We talk language. We do things on and out of class. We teach them soft skills. We teach them interview skills. So my class is just not a program of welding. I teach these young men how to be men and what the real world has to offer to them when they graduate, like bills, like introducing yourself, shaking a man's hand with a firm grip, looking him in the eyes, and just different facets of becoming a man, not just the educational side, but the building side, and incorporate that

into becoming a man and into the society. I hear some of the students are being recruited even in their sophomore year and receiving offers of up to $70,000 a year before they even graduate. Has this surprised you? It hasn't really surprised me, but it still surprises them because these guys are still young so some of them grasp the income and salary, but I try to tell them that the average income of a male is between 40 to 57,000 a year.

These young men at 17 are incorporating salaries between 60 to 80,000, depending on submarine welding, nuclear fabrication, structural welding, and they're starting this with no debt. Nothing of what us as adults seem to acquire in our age. education, structural welding, and they're starting this, you know, with no debt. Nothing of what us as adults seem to acquire in our age. These young men are getting these salaries without any means of that getting. And I hear, Marcos, you already have a full-time job lined up for this summer.

Yes, yeah, I do. It's called Holtec International. It's in Camden, New Jersey. And they make nuclear containers. And I'll be starting on July 14th. Wow. And I hear you have a question for Melody. What is it?

Yes. I'm blessed to say that because of the welding program, I'll be, if I stick with this route, I'll be making 100,000 by the time I'm 20 years old. Wow. And because of that, I'm planning on staying at my house, staying home, saving my money. But I'm going to have so much money, I really don't know what to do with it. So I was wondering like money tips from you, like what do you think I should do with it?

Okay. Wow, you're going to be flush as we said. You're going to be flush. Well, first of all, I have to say that this is welding college. This is fantastic. This is welding college. I mean, from what you've said, the amount of hours, the detail, the depth of it. And you get your certification here.

You get certified here. Yes, yes. Which is a big deal. And, but the one other thing I want to say, which I think that when people think about trades they think they are less than than I've never ever thought of that I actually even reject the idea of the notion of blue collar white collar. Yeah, I just don't like that I think work is work and it all work is admirable all work and this is Essential these are essential jobs for our society

And so it's no wonder that they are you would be in demand and you'd make this kind of money now what I would tell you Being disciplined at this age around that kind of money coming into your hands is going to require a great effort But if you are disciplined you are going to be set for life because time is on your side with the ability that you have for that money to compound and then also just The opportunity that you will have not to accumulate the debt that so many people are talking about the fact that they have to dig out of. Can you explain compounding to Markos? Markos, you understand compounding?

So compounding, Warren Buffett calls it the eighth wonder of the world. So he said compound interest is magical because your money starts to work for you instead of you working for your money starts to work for you instead of you working for your money. So a very simple compounding example that I give in my book is, would you rather have a penny that doubles every day for one month, 30 days, or a million dollars? Which one would you rather have? Oh, the penny. Right. The penny is over five million dollars.

And I explain how if it doubles every day, one cents is two cents, two cents is four cents, four cents is eight cents. And so that kind of compounding is magical. And the money starts to grow really fast. So because you're so young, and let's just say you work until you're 65, you have decades of money to compound, decades. And I actually looked at some math. I did some math on this of just something simple. If you put away $2,500 a year, just $2,500 a year, you only made 8%, only 8%, and it compounded for 25 years. It's almost $200,000.

Just $2,500 a year. So there's a wonderful calculator you can go to. There are all sorts of calculators you can go to where you can calculate returns. Now, what I would do if I were you starting, I would invest first of all, if you get a full-time job and there's a 401k plan, a retirement plan, invest there first because you get the tax advantage, you don't pay taxes on that money.

And oftentimes they have a match, which is free money. So you don't want to walk away from free money ever. So you'll still have some discretionary money that you can invest, but first make sure you're maxing out on that 401k plan, as much as you can possibly put in it. You start that now, I can tell you, it's magic. Then when you are starting to invest on your own, if you wanna buy stocks, I would invest in things you know.

So what do you like? And why do you think it might be a good investment over time? And how much should he invest or not invest in stocks? So first of all, I would- Because that's the question, when do you invest and what to invest in? Okay, so when you invest and what to invest in? Okay So when you invest you can invest at any time. I actually like investing for children

Yeah, and I like them too. If if Everest likes Barbie, I want her to have Mattel if she likes Sephora LVMH, okay, I can give you all of those examples. So is there anything in your life like a lot of young people love Video games they love that might lead you to Microsoft. You know, all of those thinking about things that are in your life, Microsoft has been an amazing stock as an example. Think of things in your life that you'd say, I understand this and therefore want to invest it.

If you don't want to do that, you can buy a mutual fund or an ETF where a professional does it for you. But your point is invest in what you know or like. Correct. Yeah. So that you understand it. I love the idea of just a small amount of money that you would invest in something that

you know and like and you can just track it over time. I think that would be something that you'd really actually start to enjoy. Okay. Got it. Yeah. Thank you. Thank you. Thank you both so much. Mr. Williams. Good luck, Marcos. Thank you. What? It sounds like a fantastic program. Yes, it is. We want

to thank you guys for having us here on your show. We really, really appreciate it here at Father Judge Welding. And Mellie, we really love what you do. And we've, I took some tips from you also. I watched your video. So, you know, I want to thank you for being you and Oprah. We don't thank you also. Thank you so much Thanks for all you're doing for So many kids, that's great Marcos. Have a great summer. Is it your first job? Yeah, this is this is I had a internship Summer job last year for welding, but this is like my first full-time job

Can I say one other thing Margo's just make a commitment? There's a certain amount of money you're gonna save no matter what you are not going to touch it It's going to go in an account. It is literally off limits to you and And I think of you again if you get into that discipline now, you won't have to learn these lessons later. Yeah Okay. Yeah, thank you so much. And thank you for both of your time too. Thank you. Thank you. That's great.

So cute. But Melody, before we go, what do we need to understand about Gen Z and money that's not getting enough attention? I would say two things. My first one is what I already said. Every dollar counts. Every dollar counts, meaning every dollar that you save counts. Every dollar that you every dollar that you save Counts every dollar that you put against that debt counts and it don't have to think of it in big numbers You know, it's not every five thousand dollars counts not everyone dollar counts every dollar counts

I'm very important for me today is what you said about the 50 cents 50 cents a day is so doable It's so doable you start small and it grows into big numbers and then that's the second thing. Time is on their side. They have one thing that is so valuable, the time that they have, the decades that they can use to help them compound money. It's not how much they put in, it's when they start. And if they start now, very early saving, that money will grow by leaps and bounds over decades. So that later they're not catching up trying to put big amounts of money away. Little amounts today grow into giant amounts over decades. That is just the math of it. So every dollar counts, every dollar you save, and time is on your side.

Time is on your side. And I thought what you said at the very beginning of this conversation that what's happening with Gen Z is real. Yeah. The struggle is real. The struggle. They absolutely, they're not making this up. They're not being whiners.

They are coming into the world with more debt than prior generations. That is a fact. Melody Hopson, thank you. It's always a delight and pleasure to be with Melody. I know you all know because she's the most liked on the podcast. And her book, Priceless Facts About Money, is available anywhere books are sold. It is a must read for children, as I've said, and their parents. Thanks to my guests, Kayla, Madia, Alexandria, Marcos, and Mr. Williams. Thank you so much. And to our partners, too.

Thank you. To all of you listening and watching, so grateful for you sharing your valuable time with us. See you next week. You can subscribe to the Oprah Podcast on YouTube and follow us on Spotify, Apple Podcasts, or wherever you listen. I'll see you next week. Thanks everybody.