The Rachel Cruze Show - Metaverse and College Degrees: Are They a Waste of Money?

Episode Date: May 9, 2022

We’re tackling some big topics on the show today—everything from the metaverse to student loan forgiveness (yep, we’re going there). What does it all mean, and how does it impact your money? Let’s find out! In this episode: Is the Metaverse a Waste of Money? Is Student Loan Forgiveness a Myth? Helpful Resources: EveryDollar Christian Healthcare Ministries Sponsors pay the producer of this show, The Lampo Group, LLC, advertising fees for mentioning their services or products during programming. Advertising fees are not based upon or otherwise tied to any product sale or business transacted between any consumer or sponsor. The following sponsor has paid for the programming you are viewing: Christian Healthcare Ministries. Learn more about your ad choices. Visit megaphone.fm/adchoices

On average, people spend about $80 billion of real money per year on virtual goods that are sold in video games. This was crazy. It's everywhere. Gosh, this is where our world's coming to. This is really going to be our world, y'all. Hey, guys, welcome to this episode of the Rachel Crewe Show podcast. I'm so glad that you're here. So in this episode, we're going to talk about some things that may not be worth your money.

You'll hear a conversation I had with my friend and new Ramsey person. Christina Ellis about student loan forgiveness. You don't want to miss this conversation. So much is being promised right now, and we're going to break down the best way to conquer student loans. But first, let's talk about the metaverse. Mm-hmm. So what is it?

How does it work? And is it worth your money? Take a listen. All right, you might be hearing a lot of talk about the metaverse. And you're probably wondering, what the heck is that? Is it real life? life because it sounds kind of like a weird sci-fi thing. I know, I know. And let's be honest,

I fully don't grasp this whole idea. It's crazy. But we're going to talk about it. We're going to unpack some of the questions you might have heard about it and learn what it means for your money. So what is the metaverse? Well, the metaverse is basically virtual reality or this virtual world that you can access to the internet or gaming. So since Facebook rebranded as meta in October of 2021, the term metaverse has now been trending. So you can think of the metaverse is kind of like that computer game, The Sims. Remember that? And it's like this virtual world and you can control the virtual characters, but it's all fake. So like, it's kind of like that. Like that's the metaverse, okay? Or you can play a game with a VR headset, like those goggles,

which is trippy, trippy. You put it on and you're in this whole other world. And like that world is the Metaverse as well. Another part of the Metaverse is something called blockchain technology, and this is where cryptocurrency comes in. So, cryptocurrency, if you don't know, is a form of digital money, like Bitcoin or Dogecoin, and you can exchange real money to buy these coins or tokens that are cryptocurrency.

But again, it's all in, like, the digital world, right? The Metaverse. But they can be exchanged person to person on the Internet without using a bank or any kind of government that oversees it. I did a whole episode breaking down cryptocurrency and blockchain a few months ago, so make sure to check it out

if you want to know more details about crypto. Now, people think, okay, so once you have cryptocurrency, what can you buy? Well, some retailers like Whole Foods, Nordstrom, and PayPal are starting to let people pay with crypto. And even some athletes and other professions are asking for their salaries to be in crypto. And a lot of people who use crypto

we'll exchange them again for goods and services. And you can also use crypto to buy something called NFTs. So what is an NFT? Well, an NFT stands for non-fundgible token. Fungible. That's the word fungible. You got it? So when something is fungible,

that means it can be traded one for one and it's not unique. So like a $5 bill example, something that is fungible. But something that's non-fungible, means that it is unique and rare. So, NFT art has become a really popular thing to collect in the Metaverse. It's basically digital artwork

that only exists in the digital world. That's where it exists. And this artwork can include things like GIFs or GIFs, however you pronounce it, animations, emojis, all of it. I mean, it's just, it's crazy. So if it's digital, how do you own an NFT? Well, this is not as simple as just saving a file to your computer.

So the blockchain is the ultimate authority on who owns what. So if someone buys an NFT, they're recorded in the blockchain as the official owner. And people spend crazy amounts of money, you guys, crazy amounts of money on NFTs. So, for example, the first ever tweet made by the CEO of Twitter sold as an NFT for $2.9 million. dollars. I still don't understand. You're probably like, why? I'm kind of asking the same question, too. So I think it's like buying a collectible item, but it's like only exists in the metaverse. I don't know. Another way people spend money is that they buy items inside of video games. On average, people spend about $80 billion of real money per year on virtual goods that are sold in video games.

And in fact, now designers are going in. You can buy clothes like Versace and Dulcich and Gabana in the Metaverse. Like you don't, it's not like real stuff, you guys. Like it's in the Metaverse, but you can own it there, but not like physically. And no joke, there was a $300,000 tiara by Dolcine Gabana only in the Metaverse. I'm probably going to like watch this back in 10 years and be like, Rachel, you were so old school. Oh my gosh, you thought that this was crazy. It's everywhere. Oh, gosh. This is where our world's coming to. Is this really going to be our world, y'all?

I mean, it's just crazy. I don't get it. I still don't get it. So you may be thinking, gosh, should I spend money in the Metaverse? Should I buy things like crypto and NFTs and other virtual items? Listen, the way I look at it, it's almost kind of like gambling. Okay? Sure, some people have made money off of it. Some people lose big time. So if you're going to, to go play in this world. I really, really want you debt-free. I want you with a fully funded emergency fund. And I want you to just be stable. Okay, like, I want you investing in your 401k and you're off-Iri. Like, can we just do the boring, stable stuff, okay, to make sure that we make it through this life with money? And then if you have extra money, that you're like, oh, yeah, I can

kind of blow this. And if it's gone, it won't hurt me. Sure, you can go play around in the metaverse, whatever. But let's be smart. Okay. Let's be smart about it because it feels crazy. Feels crazy. So just take a deep breath. I don't know. This may be the future. Maybe Jesus comes back tomorrow.

We don't know what's going to happen. But this is what's happening. So I'm giving you and relaying you the information, even though it's just wild. I mean, it is, you guys. Crazy. Let's just be stable, y'all. Let's go for the boring stuff first and foremost.

Let's make sure that we are budgeting. We're funding retirement. We have an emergency fund, all of it. Okay? Let's do that. Stay stable. Hey guys, so excited about this episode because I have my friend and fellow Ramsey personality, Christina Ellis on with me. Welcome. Thank you.

This is your first time, right? Yes. On the show. So excited to be here. Welcome. Welcome to the place. Yes. So glad you were here. I was actually on back in 2019.

Oh, that's right. You were, well, as I was saying that, I was like, I kind of feel like you have been here, but yes. Yeah, it was like a really short clip. Yes, that's right. First official intro. That's right. As Ramsey personality. She's here.

So she's a best selling off. who has helped thousands of students earn their degree completely debt-free, which is amazing. And you wrote a book about how you won over $500,000 in scholarship. So I want to hear your backstory. Tell everyone kind of what your story of what happens and how you got all that money. Yeah. Well, my story really began, my freshman year of high school. My mom gave me a challenge.

She sat me down and said, Christina, I love you and I believe in you. But there's just no way that I can support you financially once you graduate from high school. So you got to figure out your own way to pay for college. Now, at first, like, every freshman, I was like, why are you telling me this? I'm a freshman in high school. What can I do about it? But at the same time, she was just trying to be real with me. My dad, he actually passed away when I was seven after a long and painful battle with brain cancer.

And my mom, she did the best she could to support me and my brother, but we still struggled financially. So the idea of spending thousands and thousands of dollars on college was just not an option for her. So she wanted to light a fire in me to figure out how I could do it myself. She told me about scholarships, and I just got so excited about him. I started doing a ton of research. I read every book I could find, every article, every magazine, and it was just like, how can I win scholarships? How can I stand out in this process?

And I put together a strategy and implemented it all throughout high school. I got super involved in extracurricular activities, took up leadership roles, did volunteer projects, and then my senior year of high school, I treated the scholarship application process like a part-time job. I just applied, applied, and applied. And thankfully, all the hard work and effort paid off. It led me to win over half a million dollars in scholarships and go to Vanderbilt for undergrad

and Belmont for grad school completely debt-free. Oh, it's unbelievable. Unbelievable. And what's crazy is just a little backstory. So when I first started doing this job was like 2010, 2009, 2010, when I would travel and, like, I would go into high schools. Like, that's how I started speaking. And I used a clip, I've told Christina this, of her on the news,

somewhere that I found because I was like, I'm telling all these high school students that they can go to school debt free, and this girl did it. Watch Christina. And I played just like two-minute clip of Christina. So we finally met in person. I was like, oh my gosh, Christina for like a decade. I've been waiting.

Talk to you a person because it is. It's so impressive. So impressive is what you've done. And you're here now at Ramsey Solutions to really bring that message home to students. Like your heart really beats so deeply for them to find a way to go to school debt-free. Yeah. Once I graduated from college, I had all these friends that were saying Christina, like I wish somebody would have sat me down in high school and told me that I didn't have to take out student loans,

that there is another way. And just seeing my friends struggling with thousands and thousands of dollars in debt, I was like, I've got to do something about this. Like, I want to share my story and help people see that there is a different way. So I was able to write a few books on it, and now I've been able to travel the country and help thousands of families graduate debt-free. It's amazing. Yeah, so great. So great.

So great. Because as you guys know, Student loans, it is a huge, huge issue today. I mean, millions of people are struggling with it. So I want to dive in to this topic right now, but specifically on student loan forgiveness. So an article came out recently and talked about the student loan repayment. And it said in a new report from the Federal Reserve Bank of New York found that 37 million student loan borrowers haven't been required to make a federal student loan payment since March 2020. and 10 million student loan borrowers with private loans or FFELP loans were required to make student loan payments and did not get the student loan relief.

So once federal student loan payments restart, student loan delinquencies are expected to rise. So what does that mean when you hear the word delinquencies? Like, what does that break that down for us? For a lot of people, right? A lot of people are owing student loans and they just haven't been paying on them. Yeah. Delinquency is what happens when you miss. a student loan payment. So the first day that you miss a payment, you are delinquent on your

student loan. Now, if you continue to be delinquent on a student loan, then you go into default, which you really want to avoid at all costs, because once you go into default, they can garnish your wages, they could possibly file a lawsuit against you. So you definitely want to stay away from both of those. Yeah, I don't think it's going to be so hard for people. I'm like, if you've gotten in the habit of not paying your payment, either because this program that feels like forgiveness and it's pausing and it's like, oh, okay, I'm not going to worry about it. Or you really don't have the means right now because maybe your job changed in the pandemic, whatever it looks like.

But just being in the habit of not paying your payment, like, that's hard. And then when it kicks back in, I mean, it is. It's going to be a huge issue. And when that kicks back in, we don't know. We genuinely don't know. It keeps getting pushed out and pushed out. So there was a pause again through August 31st. They're going to extend this, again, pausing.

the idea of you having to pay your student loan payments every month. But there's also a decision about completely canceling student loan debt, which is, again, I feel like been talked about so often. And so apparently Biden came out recently and said that he would cancel $6.2 billion of student loans for borrowers who are struggling financially, but we don't really know exactly who qualifies for this. And that amount of money, that billion, $6 billion is not in the budget, was not in his annual budget.

So this is another kind of frustrating thing because we were talking about this before the segment and you were like, but that's just billion because trillions are owed. So it's not even that much if it even goes through. Right. And that's part of the problem is that there are so many students that are just coming out of college and they came out of college when the pandemic hit and they've never experienced paying them in the first place. And so now it's like this is their first time working with money and running a budget as an adult.

And these payments have been paused. and then they're supposed to start now, and then they're extended. And it's just so confusing for all these students who are just starting out, wondering how on earth to deal with it. Actually, we'd just make a decision. Yeah, that's right. I mean, sometimes when you read through this stuff, even the language in these articles is confusing, too,

because it's like future tense and past tense. Has he done it? Is he not? We don't know. So listen, we say it all the time, but it's just true. When you want to get rid of your student loans, it's up to you. It's up to you to do it. Who knows how long they're going to kick the can down the road. I mean, it could be another 30 years, and they're still going to be talking about student loan forgiveness.

So we don't know. So if you want your student loans paid off, you need to do it. So I want to know your thoughts, though, overall on this idea of student loan forgiveness because I feel like people have strong opinions one way or the other. Yes, I'm just curious after all your research and everything you know about it, what you think. The problem is there's just so much red tape with a lot of these programs. So there's a lot of people who are counting on public student loan forgiveness, and then they're shocked when they either don't qualify or they get disqualified.

In fact, in 2021, less than 2% of these applications were actually approved. So that's all these people who were making their payments on time and thinking that this was going to happen for them, and it just didn't happen. And then when we talk about broader student loan forgiveness, again, who knows if that's going to happen. But there's a lot of people with private student loans that won't even qualify if the government forgives public student loans. So it's just really challenging and really confusing because people don't know what to expect. And a lot of these programs, like even the idea of it, it's just not really,

reliable. People are just confused and they just don't know what's going to happen. Yeah. It's tough. Oh, it's so hard. I don't know. And it's so funny because I'm like, my heart, I'm a little bit split on it because there's a part of me that I'm like, no, you signed your name, personal responsibility, like Dr. John DeLone. I've heard a few people like they harp on this. But then I'm also like, but it's these 18-year-olds that had no clue what they're doing. And some of them are, feel like they're almost tricked into it because they just see financial aid and FAFSA and they think, oh, this is scholarship. I mean, even the language and that's You know, like, the whole thing's a mess to me.

And so, like, my heart just breaks for people that are, like, they're in it and they made a decision 19, and now it follows them for decades of their life. And so that's, we don't want that for you, okay? So, like, again, the idea of saying that I can take control of my money and I can actually do something about this in the future, it's empowering. And we hear it all the time about people paying off their student loans. Yes. Which is huge.

So what is a good plan for people to go about this process if they're feeling overwhelmed? Yes. Well, first get on a budget. You want to tell every dollar where to go, give an assignment, and then crush that debt using the debt snowball. Pay off your loans, smallest to largest. I mean, you may need to get a second job to get a side gig. It can feel like a lot. But remember, this is just for a season.

Like, you're doing this hustling for a season so that you don't have to stress out about it in the future. And you can get on with the rest of your life. And then also consider student loan refinancing. We don't always recommend it, but you can do it if you can get a better fixed rate, a shorter term, and you don't have to pay any fees for the refinance. Plus, I want people to make sure you keep motivated because some people refinance and then they see a smaller payment and they're like, well, I can kind of put it on the back burner. It's like, no, you have to keep your gas going. Yes. Yes.

Put on the pedal. That's right. That's right. Keep it going, even though you feel like you may see that smaller payment. So, again, I hope that you feel the weight of this, again, that so much of this is in your hand. And, you know, as Christina is saying, that you shouldn't wait until the student loan repayment process gets kicked back in. Like, people should be paying their loans right now, which is huge because there's not interest right now. And so they actually could get ahead financially by paying them now.

Yeah, it's the best time to be working on paying down that debt. Yeah, because it's not growing interest. Like, you can really tackle this and knock it down quickly during this time. Yeah, so take advantage of it, you guys. Don't just sit back and be like, oh, I don't have to pay right now. paying on it again because you can get so ahead on the principal. Christina, thanks for being here. Oh, thanks for you.

I love having you on the team. Seriously, I'm so glad you're here. And where can people find you? Because I know there's a lot of people listening to think, oh, my student loans paid off, or they have a child. I do not want them in student loan debt, and I want them to apply for scholarships and grants and all of it. And you're the person to go to.

So where can everyone find you? Yeah. You can find me on Instagram or Facebook at I am Christina Ellis, and that's Christina with a K. And you can find a lot of my content on Ramsey Solutions.com. We have a great article that came out that is all about how to deal with repayments starting and how to plan your budget. So go to Ramsey Solutions.com and look up student loan payment. So good.

Oh, I love it. And you were in our documentary Borrowed Future as well, which went so well. It's incredible, you guys. So make sure that you check that out because it exposes this entire system that you know a lot about because you dug into all the details of it. So you guys can check that out anywhere that you can watch documentaries. so Prime Video, Apple TV, Google Play, or Ramsey Solutions.com. So again, we have so many resources for you guys because we want you to tackle this thing that feels like a mountain, but that you can do it. All right, Christina, before you leave, the one question I have that I ask all my guests is what is one thing you're doing with money that's creating a life that you love?

Well, we are about to buy a car, which we're really excited about. It's got all the worst time to buy a car. So now you've got to do it. But yeah, we have a 2008 Ford Escape with over 200,000 miles and tiny babies, so we're about to try to bargain hunt. We need. Do you know? I don't know.

I got my last car for $6,000 off Kelly Blue Buck. So I'm just kind of like open to the type of car and mostly winning a really good deal. Yes, I can appreciate that. As TV, hopefully. Yes, yes, yes. Some room. Well, if you want any opinions on minivans, Christina, just out of this gal. Well, thank you again, Christina.

for being on. I so appreciate it. And you guys, use her as a resource. Like if you know somebody that is going to college soon and they're wanting to take out loans or they're thinking about it, send them her way. Again, so much content around the subject that's just really, really important. It really can completely change your financial future.

Well, I hope you guys enjoyed that conversation I had with Christina. She's just wonderful. It has a heart of gold. And again, student loans, man, they follow us everywhere. So getting them out of your life is so, so important. All right, one thing that I am loving right now is our new puppy. That's right, the cruises, we got a new puppy. We had to put our yellow lab Nala down in October.

She was 12. It was terrible. If you're a dog person, you know, it's just like the worst thing ever. So we have been preparing knowing that we will get a new puppy, and we did it. We did it. So her name is Juniper, or June is what we're calling her. and she is a field-bred, Cocker Spaniel, and she's just precious, y'all. I mean, the puppy, it's everything.

Like, she just has the puppy breath. The sweetest little thing sleeps, like, every, like, 20 minutes. I mean, she's just precious, absolutely precious, and my kids are obsessed. The girls, oh, man, she, like, doesn't walk when she's around the girls, because they literally pick her up and carry her everywhere. So that is just, man, it's been so fun. And so that's one thing I'm loving. and then I'm going to keep on the June train here

and things I'm learning. Puppies again not quite like children. No, no, no. Sort of. They pee everywhere, but you got to stay on top of them. So we are house-breaking her as we speak, and we know it takes like a good three to four weeks. And then I think we're going to send her off,

honestly, for a few weeks to get training and all of that. So we're kind of in that re-learning phase of having a puppy. It is worth it because she's so fun. So precious, so precious. All right, you guys, thanks so much for listening to this episode of the podcast. I want to thank Christina for being on the show. And if you guys have not hit the follow button to subscribe to this podcast, make sure you do that. And if the spirit leads, you can leave a review.

And if you have a great friend that you want to share this podcast with, make sure to do that as well. Remember to take control of your money and create a life you love. You know,