The Ramsey Show - App - DAVE RANT: Go to a College You Can Freaking Afford! (Hour 1)

Episode Date: August 13, 2020

Education, Budgeting, Savings Tools to get you started:  Debt Calculator: http://bit.ly/2QIoSPV Insurance Coverage Checkup: http://bit.ly/2BrqEuo Complete Guide to Budgeting: http://bit.ly/2QEyonc Interview Guide: http://bit.ly/2BuGnZE Check out other podcasts in the Ramsey Network: http://bit.ly/2JgzaQR 

Live from the headquarters of Ramsey Solutions, broadcasting from the Dollar Car Rental Studios, it's the Dave Ramsey Show, where debt is dumb, cash is king, and the paid-off home mortgage has taken the place of the BMW as the status symbol of choice. My co-host today on the air, number one best-selling author, Ramsey personality, Rachel Cruz joins me. Also, my daughter will be answering your questions at 888-825-5225. I guess you're actually my daughter first, and then your number one best-selling author, Rachel Cruz. Sure. Switch the, yeah, you can switch the titles.

Just have to get this straight. What's the right order of the announcement here? Depends on what we're doing though i was gonna say that's the weird thing about family business is i'm like technically i would be an author first daughter second in this seat you're the ceo first it's kind of cold dad's also true i don't know that's probably true that's how it works keep the levels anyway we're not confused about helping you. Although we sound a bit confused. Open phones at 888-825-5225.

888-825-5225 to talk about your life and your money. Sarah starts off this hour in Syracuse, New York. Hi, Sarah. How are you? I'm good, Dave. How are you? Better than I deserve. What's up?

Hi, Rachel, as well. I'm really glad that you guys took my call I really appreciate it sure um so I'm a 22 year old grad student I just graduated my bachelor's this past May um and my question today for you guys is should I actually continue on with my grad studies or should I try and enter the job market right now? What do you want to do, Sarah? Just for a little bit of background, I'm about $19,000 in undergraduate debt, but I've saved up $14,000 in this past year. And it's that chunk of money that I'm really trying to figure out what to do with. I saved it up initially so that I could cash flow my first year of graduate school that would cover all my tuition costs. But honestly, the pandemic has had me rethinking everything lately, and I just want to make sure that I'm making the best move for my future right now. Absolutely. Well, I think we start with the idea that knowledge is better than lack of knowledge. So knowing stuff is always a good thing.

It lowers your pain level if you know stuff, right? And so we're not against school or academia, but we also don't want people thinking that school or academia is necessarily the key to success because there are no studies that show that. Now, Rachel was asking, what field of study are you in? I'm going into public administration. I've actually worked in public administration for the past year, and that's really where I found my career goal and interest in. So do you have to have this graduate degree in order to do that, considering you've been

doing it, though, for the past year? What have you been doing for the past year? So I've been working for the state, actually. I don't necessarily need the degree, but I think that it would help me long term in the field. Okay. Well, Sarah, if I woke up in your shoes tomorrow, I would continue to stay in the job field that you're in, continue working at what you've been doing because you're able to do the job without the degree, go ahead and pay down all your student loans. And then if you want to go back to grad school and maybe, you know, three, four years when you have saved up money, then that's an option. Cause even school now, I'm like, it's all going to be online. Like it's, it's, it's all,

it's all funky now. Education is because of COVID-19 and tuition rates have not even, they haven't, they haven't decreased at all, even though everything's online. Like, it's just, it's such a wonky time right now. So if I were you, if you were able to do the job you want to do without the graduate degree, go ahead and work and do that. And then if you look up in a few years and say, no, I really do need this degree to maybe get a different job or, yeah, like you're saying, to advance something. So when you're 42, what is your job with your career path? So I'd really like to work in public finance. So that's the career path.

Because you'd be the commissioner of finance for the state of New York. That would be quite a goal, yeah. Well, I mean, you're 42. Why not? Yeah. I mean, we're dreaming. We're projecting out. If not, you're the right-hand assistant who does all the actual work projecting out if not you're the uh the right

hand assistant who does all the actual work and doesn't get any of the credit right either one's okay this is state government we're talking about okay yeah so you know but that's that's the that's your path okay now i am not an expert on that truthfully on that on that career field pro i mean i know a lot about a lot of career fields from having done financial coaching with the different fields, and so I've got an idea of what people make and those kinds of things. My perspective, with my limited knowledge, is that you will need the master's in public administration to advance because it's probably going to be a barrier for you to get into upper leadership positions within a state

because I think a lot of your peers will have that. Am I correct? Yes, that's what I was thinking, but I feel like what a lot of people do is they get a couple years in and then they go back for the degree, and I'm kind of just taking a different route. Well, that's what I was going to suggest, which is kind of a combination of what Rachel said. Go ahead and take the job.

See if the state won't pick up the bill, by the way, for the tuition. Because some state employees go to state universities free. Yeah. I think I should have clarified this. So my position is actually an internship for my program. It's not like a full-time position. Yeah, okay, but you're making money. You've got your foot in the door.

If you can land a position, an entry-level position, and get started, and like Rachel said, let's let this resettling of higher education occur over the next 24 months. We don't know how much it's going to change. I don't predict it's going to change a ton. But one thing that has happened is that we have Americans have stepped back because of the student loan crisis, punch one. Then punch two has been COVID sent everybody home, and all of a sudden these kids are trying to charge full tuition for a study from home program, and everybody's going, I don't think so. I don't think I'm going to pay that for that.

The value proposition has shifted, and so that's a one-two punch. They weren't really questioning tuition as long as everything was going along like it was. It's too freaking high. But they weren't yelling about it too much unless they were deeply in student loan debt because of it. Now with COVID and they're all having to go from home, they're like, I don't think so. Value proposition is not there. So I think we're going to see some settling of something. It may just be a price adjustment where we all go higher education's

knowledge is important but it's way freaking overpriced and so maybe we're going to have a thing so i'm with you rachel i think she goes to work for two years three years might get on with the state or a pub or a city that that has a tuition program and then you work your tail off and take your master's at night and finish it up so that by the time you're 28, you've got your master's and a bunch of work experience, and by then you're going to have your career path dialed in. I like that plan. And debt-free.

And you're debt-free, by the way. Yeah, all of it. So, yeah, that's what I would do. I don't think you're in a rush. And, again, like you said, you can't predict it. You don't have a crystal ball, but she probably will need a graduate degree eventually. But I do think it's been a theme, or at least it was a few years ago, statistically, watching the statistics and research. That's like the next step everyone does.

They graduate with their bachelor's and they just, oh, yeah, I'll go to graduate school, right? It just becomes that next step. So the fact that you're kind of pushing the limit to say, what other options do I have? It's really healthy. It's really your critical thinking skills are kicking in. That's awesome. Yeah, I agree with that. It's not automatic.

And again, we're not against master's degrees. We're against useless master's degrees or master's degrees that have no market value. Translation, useless master's degrees. They're not required. If you're going to go into psychology and get licensed with a state, you have to have a master's degrees they're not required if you're going to go into uh psychology and get licensed with a state you have to have a master's degree it's a precursor okay if you're going to run a 250 million dollar business it's helpful to have a master's in business but i don't have one and i grew this from a card table in my living room it's not a precursor to cause this to

happen this is the the Dave Ramsey Show. Folks, I love telling you about well-made, well-thought-out products. Today, I'm talking about Grip6 belts. I don't know about you, but I'm not a fan of traditional belts. They never fit right and they're uncomfortable. Grip6 belts are unique. Owner BJ designed a truly modern minimalist belt made of high quality materials with no holes, no flap, and no bulk. And the buckles come in really cool designs and are interchangeable. I personally own these belts in different styles, and talk about affordability, GRIP6 belts come with a lifetime guarantee. And that means if you no longer like or fit the style of your belt, you can replace them for free. Plus, I like the way these guys do business.

GRIP6 is determined to help build and modernize american manufacturing to It's the Dave Ramsey Show. Rachel Cruz, Ramsey personality, number one bestselling author, is my co-host today. We are in pre-sale on her brand new book that will come out in January, Know Yourself, Know Your Money. And the pre-sale on this book, we launched it a week ago, is at record levels. It's one of the fastest-selling books we have ever launched. Rachel, I think you have caught a nerve. I hope so. I think people are interested.

Yeah, well, I think that this book, for me, as I was writing it and I was realizing it, mean this one really really came from my heart i know the other ones did as well we did smart money smart kids my first book was with you you know and you know kind of telling that story of like this is how i grew up um love yourself uh i'm sorry um oh my god i literally am blanking right now love your life love your life not theirs i literally was like i cannot remember the name of my book oh my gosh but i wrote that mothers of kindergartners they lose their minds i have three kids five and under that's why um oh gosh love your life not theirs yeah that one came out of kind of a um the comparison thing obviously was a was it is still a huge issue and was in my life for sure but But I kind of wanted to do like a core money book, you know, with my thoughts around it

and all of that. That was good. And so this book just kind of came out of 100% me. I was like, I don't feel like I have to check any boxes. Like not that the others were checking boxes, but this was like a full on, what do I want to write a book about? I'm like, this is it 100%. It's things I'm learning.

It's things that have changed my life. And so that's been a fun, that was a fun part as an author that I really just felt led to all the content that's in it. Well, I'm privy to the manuscript since it's our company doing it, obviously, and I read them. And so I know what you're saying, but know yourself, know your money, discover why you handle money the way you do and what to do about it. So you've kind of got the book broken up into sections. Yes. So there's eight sections walking you through understanding yourself. So the way I've always, the way I was thinking about it as I was writing the manuscript was, you know, at Ramsey, we do a great job building upon the foundation of people's lives when it comes to their money. I mean, we are the best on the planet at teaching you. Here's how to budget. Here's

how to get out of debt, why you should get out of debt. Here's how to build up your retirement. Here's how to become a millionaire. Here's how to pay off your house. Like we were so good at that and building upon the foundation. But this book is all going under that foundation of who you are as a person, the person who is handling the money. You know, your money, is it how much your childhood affected you in the house you grew up in? How your fears in life affect the way you handle money? How your dreams affect your money? How your tendencies, personality-wise, affect your money?

How your relationships in your life affect your money? I mean, all this stuff and understanding why. This is why I handle money the way I do. Breaking it out in all those, yeah, eight different sections. So really, Ramsey tribe members, about the only thing they will see that they have ever seen before is nerd free spirit. Are you a nerd or free spirit? Or are you a spender or a saver, which is stuff we taught in Financial Peace University as far back as when you were a little kid. But, I mean, to the point that we have people on debt-free stage when i'm wearing a t-shirt says i'm the nerd the other one says i'm the free spirit that kind of stuff so it's ingrained into the pit folks that have been doing ramsey stuff for a long time but you just took that concept

of going oh that's helpful to be able to communicate in my marriage and go well yeah you're you're more of a detailed person and i'm more of i don't care about details and or you're more of the natural saver, I'm more of the natural spinner. It gave you a context to have a discussion in your marriage or just look at yourself in the mirror and go, that's who I am, and so I've got these positive tendencies, these negative tendencies, and you just took that general idea, that little tiny little sliver of an idea, and then you went into the family of origin, where you come from, how does your family handle money, and then how does that affect how you handle money and fears?

Money fears, I think that's probably one of the most powerful parts of the book. Yeah. Going through, there's really six core financial fears. I mean, there's a lot, but those were the six that I feel like I hear from all the time. There's six of them. And so unpacking that and just saying, okay, how does that, how does fear in general dictate your life? And you don't even realize it, how does fear in general dictate your life? You don't even realize it, what it does to your psyche and everything.

And when you can break that down and say, okay, here are the things I can control. I mean, all of it. So, yeah, the fears section was an interesting one. We've got a free money quiz that you can take, and it'll give you an idea and get you started on this whole discussion. It's a great thing. It's completely free. No strings attached. No salesman will call text the word money quiz one word no blanks money quiz to 33 789 and get started text money quiz to 33 789 you get started if you buy know yourself

know your money in the pre-sale that we're in the middle of right now, you get $50 worth of free bonus items. The book actually comes out January 5, which will be here in 20 minutes. And we will all be cheering because 2020 will be over. I know. And Know Yourself, Know Your Money audiobook is included. Know Yourself, Know Your Money e-book is included. Exclusive video lesson from Rachel. I mean, COVID will be gone.

The presidential election will be gone mean covet will be gone the presidential election will be gone 2020 will be gone this is like this is gonna i'm just this i'm throwing the biggest new year's eve party on the planet oh yeah we need 2020 out of here and you just predicted covet's gonna be gone i don't know about that i know well i mean i mean the i mean all the oh i just no no no, no, no, no. I'm saying, though, because... Y'all just blog and hate me. It's all right. Screw it.

No, no, no. I was saying because you're always so optimistic, which causes me to be optimistic. Like, back when all this happened in March, I was like, surely by June, it's all going to be over. It's fine. And June came, I was like, surely by August, everything's going to be fine. And then I'm like, surely by... Yeah.

So you're just optimistic, saying, surely, surely, surely. going to be fine. And then I'm like, surely, but yeah. So you're just optimistic saying, surely, surely. Don't call me, don't call me, surely. Sure. All right. All right. Catherine in Newark, New Jersey. Hey, Catherine, welcome to the Dave Ramsey Show. Hi, thank you so much for taking my call.

Sure, what's up? I had a question. My husband and I were in Baby Step Six, and last year we took out a 30-year fixed mortgage. It was before we started listening to you, and it was at 3.625%. The monthly payment's about 24% of our take-home pay, and I recently got a quote to refinance to a 15-year at 2.25%, with closing costs roughly $2,000, but they would credit us $1,000 because of a promotion that they're running. So I'm not sure if it's worth it for us to refinance at this point. How much is your loan balance?

$292,000. Okay. If you save 1%, what you're going to save a little more than that, right? Your interest rate today versus your interest rate after the refinance is more than 1%, correct? It is, yes. So in one year, you would save 1% on $225,000, which would be $2,200, right? Okay, yes. Did I do that right? And it's only going to cost you $1,000 out of pocket to do this.

Yes. So your break-even point on this is six months after six months you're going to be making money not due to the 15 or the 30 but due to the interest rate being less you don't and you don't refinance to go from a 30 to a 15 you refinance to save money on interest right okay so if you're going to stay in this home i would refinance it and it's probably going to bump it's probably going to bump your payment up when you do a 15 up above where we would like it to be it's probably going to bump it up to around 30 percent that's not the end of the world especially if um you you said your baby steps six you've got no other debts and especially on top of that is if your income is not stagnant. Okay.

Like five years from now, how much do you think your income will increase with your current career tracks? Right. Okay. It'll definitely increase five years from now. It'll probably be over $200,000 a year. Yeah. So the point of the whole thing on 25% of your take-home pay, that's what you were referring to, is to not get house poor.

Yeah, making sure that your house isn't taking over. I mean, because we talk to people sometimes and half their paycheck is going to their house. And it's like, there's no way you're going to be able to make a ton of financial progress when your mortgage is eating up so much. But yeah, I think you're still in a great position, Catherine, to still refinance. And if it bumps up close to that 30% in a few years, it'll be back down to 25% because of your income.

Yeah. So we used to say you needed to save 2% or more on your interest rate in order to refinance. That was a rule of thumb. With the interest rates as low as they are, that formula doesn't necessarily work exactly anymore. So the way you do it is you take how much interest you're going to save in dollars with your change in interest rate annually, and you divide that into your closing costs. So if she's saving $2,000 and her closing cost was $4,000, it means it would take two years to break even. If she's going to stay in the house longer than two years, she would do it.

With her promotional situation with this mortgage company, she's done in six months. It's a no-brainer. Do the refinance. This is The Daves.com. Find out for yourself why Blinds.com is the number one online retailer of custom window coverings. You get free samples, free shipping, and with the new promos they run every month, you'll save even more. Use the promo code RAMSEY to get the best deal. So you're not going to read the question?

Unbelievable. Read it. Just read it. Okay. Questions from Daniel in Florida. My wife and I use the EveryDollar app consistently. You're the EveryDollar girl. What do we do with extra money left over at the end of the month in a specific line item

category? For example, we budget $125 for an electric electric bill and ends up running 107 do i chuck that extra money into savings or put it towards debt or use it for fun money i've noticed that i will have an extra 150 to 200 in extra money uh in categories we over budgeted because we don't spend all the money so what would you do i don't know you just called me out in front of America. I didn't really even hear the question. Okay, hold on. Okay, so they budget $125 for electric bills. Okay, so they have extra money coming in.

They have extra money that they don't spend. Electric bills instead of $107, $125, what do you do with the difference? Yeah, throw it towards your baby steps is what we do. Yeah, so if you have debt, throw the extra at the debt. If you're billing up your emergency fund, throw it to the emergency fund now if you're in baby steps four through seven this is where you can kind of be like you know we could put that somewhere i mean you could you can put it in fun category yeah entertainment category but if you're in baby steps one through three definitely apply it to the baby steps exactly exactly yeah so basically though as you're doing your every dollar budget what happens is that um when the real bill comes in versus the allocated amount,

then you make the adjustment in your every dollar budget. And you say, okay, 107 is the real electric bill, not 125. And so I've got that difference, and I'm going to pull that difference and put it over in another category. And Every Dollar Budgeting app makes that easy to do. Yeah, absolutely. So you're reconciling your budget to reality as you go along. Yes, and Every Dollar helps with the math. I mean, it keeps showing you're reconciling your budget to reality as you go along. Yes. And every dollar helps with the math.

I mean, it keeps showing you what you have now. That's a great situation when the every dollar budget, when it comes in less than what you allotted. The worst is when you decide to turn on your irrigation and you get your water bill the next month. Is this something that happened to somebody I know? I don't know. I'm not saying. You turned on the irrigation and the water bill was high? Yes.

Yeah. Yeah, I know. We didn't really account for it in the every dollar budget. So when we got our water bill this bill was high? Yes. Yeah. Yeah, I know. We didn't really account for it in the every dollar budget. So when we got our water bill this month, I was like. It was the other way around. It was the other way around, which hurts. Because then you've got to go lower all these other categories. And you're like, dang it.

The grass is greener on the other side. It costs money. Man. Yeah. It's just having to cut things. I know that's what I'm saying, though. It's like, well, when you budget, though, that's a real thing. Stuff shows up. You feel feel it you really do what happens is reality starts

hitting you in the face instead of you being able to ignore it yes and then you think happens when you do a business budget too yeah 100 so anyways when it when you have more money left over that's the fun part of budgeting because you have more money to spend but when when bills come up a little bit higher you gotta you gotta reconcile it but it's worth it because then you know i mean we have the money for it and so we're just gonna have to switch other categories lower other ones got a way to go that's exactly right so uh the self-study course for teenagers at home uh sort of a homeschool study of addition of our high school curriculum if you will no instructed need instructed needed. You can teach your kids how to handle money. So when they're grown, they can leave and pay their irrigation bill.

So right now our self-study course is at a deal. Go to DaveRamsey.com slash self-study and learn all about the different courses available for middle school students and high school students so that your kids can have a sense of confidence. What happens when someone's a teenager and they go through this high school curriculum, whether it's at home or in the classroom, their confidence level about existing in the real world increases? Because there's a lot of fear looking at the real world and not knowing if I can make it. Yeah. Oh, yeah. Well well it's so many unknowns and so when you unpack it especially the money part which i feel like that curriculum does a really great job giving those students what they need to know and it's all common sense like these they're going to learn things for sure but overall they're getting ingrained that this is this is the wisest way to handle your money things like live on less than you make if you don don't have the money, don't buy it.

Those type of things. It creates forced conversations with your teenagers that you might not have had otherwise. Like work is where money comes from, not entitlement. DaveRamsey.com slash selfstudy. Check it out. Paige is with us in Abilene, Texas. Hi, Paige. How can we help?

Hi, Dave and Rachel. Thank you so much for taking my call. Sure, what's up? So I'm 21 years old, and I'm about to graduate from college in May, and I've been fortunate enough to have a good job while I've been working my way through school, and I'll be graduating debt-free, and I've also accumulated about $50,000 at the time when I graduate. So my question to you is— How'd you do that?

So I ended up working full-time in school. I was working for one of the major cell phone company providers, so they ended up paying me both hourly and commission, so that was really helpful. And you were good at it. You're a good salesman. Okay. And where'd you go to school?

So I go to Abilene Christian University. Okay. And you paid cash for it? Yes, sir. You're incredible. Proud of you. And you have $50,000 left over in your questions. What?

So I'm just curious as to what is the best way that I should spend the money. I was considering maybe putting it as a down payment on a house, but I'm not sure if that's the right decision just with me being pretty young. Yeah, Paige. This is, number one, a great conversation. It's usually the complete opposite of what we're getting when there's a college student. Usually, you know, obviously, there's

tens of thousands of dollars of student loans. So the fact you have 50 grand saved up, I would not rush to throw it at a house right now. I would just kind of pause. Let this life transition happen. After you graduate from college in May, see what you want to do. Where do you want to go? Where do you want to live?

And that transition between college and the real world can be a very expensive one. And so having that cash available, not to rush that you feel like you have to spend it, have it there. And then once you settle down. And when you get a couch that's a non-college couch they cost more that is true so yeah it didn't come from a didn't come from a uh craigslist a craigslist yeah or a garage sale couch right so uh they do cost more and not not that you're going to blow the whole 50 grand on consumer items but rachel's right getting settled into quote the uh the the big girl job and the adult job and all that kind of stuff and settle down, get in your own place, get settled.

Let's do that and take 24 months. You'll be 23, and let's see what life's handing you then, and I think you'll make a much better decision on buying a house. Okay, Paige, can I interview you for like two seconds while I have you on the phone? Sure. Okay, so how much is your tuition a year? So before scholarships, I think usually it's supposed to be about $37,000, but I've been able to get some scholarships,

and I think it's down to about $16,000 a year. And then my company, they actually give me $5,000 a year in tuition reimbursement. So I've been out of pocket about $6,000 a year. And what were your scholarships in? They were just some academic scholarships. And then I also got some from the College of Business where I'm doing my degree. How many scholarships did you get and how many did you apply for? So I applied for quite a few. I applied for all the university scholarships, and I wasn't able to apply for them until my second year. And then once I got those, I ended up getting quite a bit more in scholarships. And I even had one semester

that was completely paid for just by the scholarships that I received. And then how many hours are you working a week, Paige? It kind of varies, but usually I'm working about 35 hours a week. Okay. And carrying a full load and graduated in four years? Yes, sir. I'll be getting my master's. I thought people died if they did that. I thought that was child abuse. Definitely wasn't easy. It was not easy, but graduating with $80,000 in student loan debt and no money in your pocket ain't easy either. No. You're a rock star. Amazing page.

Well, I just wanted to say it out loud for America to hear, because it is possible. I get pushback all the time when I talk about going to college debt-free. You want me to say pushback? Go read my Instagram comments right now after I posted this. The federally insured student loan program is stupid and it needs to stop now. We the people need to quit letting Congress insure loans in our name to put young people so deeply in debt they can't breathe. I'm not against education.

I'm against stupidity. All the comments are, so you don't want people to go to college. You can't afford college. You old man, you don't know anything about the cost of college. The comments are full of stupid people. And there's a rock star right there

who just did it. That's what I'm saying. Pretty freaking amazing. You shouldn't comment on Instagram if you're stupid. Okay. Their comments are stupid.

They are not stupid. Yes, both. Both would be true. Both would be true. This is The Dave Ramsey Show. MZShop. We were rudely interrupted by the network's need to make a profit around here with those commercials, and so I want to continue that discussion. The answer to the equation is simply this, okay? Young Page is an absolute rock star and is an example of thousands of people

that we have met over the years that have gone to college debt-free, okay? Now, what do we tell people? Anthony O'Neill's book, Debt-Free Degree, covers this. And the first thing that you have to do is you have to stop saying to yourself and for sure to your young people, America, that the only way to go to college, because college is so expensive, that the only way to go to college is a student loan.

And to do away with a student loan debt program would mean to do away with education, which is absolutely asinine and wrong. So you have to stop saying that first. And then how could you say that? Well, you can say that with the proof that's in the pudding, and the elements that you need to do to go to college debt-free are scholarships. That's what she's doing.

Well, it's choosing a school you can afford, first and foremost. Scholarships and grants. Working. I mean, there's many elements, but I think that very first step, though, well, the one before that one, was that you have to decide yourself. I'm not going to do this. Like, I'm not going into debt for it, so now what are my options? And when you do that, then reality starts to play in. Okay, maybe I go to a community college for the first year or two my school selection is key

maybe you stay in state and go to a public university page still freaking went to a private school thirty seven thousand dollars a year but had the scholarships to do it and worked and paid for it she never paid thirty seven thousand no She chose her school based on where she could get scholarships and that she could afford it. So you go to a school that's doing that, Abilene Christian in this case, which I've got a good friend that graduated from there, a couple of them, matter of fact, and you also can go to an in-state school. You also can go to a community college, and you don't have to go across state lines and pay three times the

tuition for basically the same education because you went across the state line now some adjoining states sometimes will give you in-state tuition because they're trying to attract students across the state line yeah um and particularly students with good grades now the other thing was she had a good grades let me tell you also what else she had great parents you know i know she had great parents she's articulate and poised and confident she is working hard 35 hours a week she did her studies when she was in high school and wasn't turned out to run loose and anarchy we know that because she got academic scholarships okay you don't get those without putting in the work they don't look at people and go oh you're smart they go you did the work and you got the grades and you're smart that's

how academic scholarships happen so there was discipline in that household. Yeah, absolutely. Well, and yeah, and to her credit, I'm like, she's 21. She's a rock star. And just absolutely killed it. So it is. That's why I wanted to keep her on the phone. So I'm like, it's just proof. Like, this shows you. It's stories we hear all the time, but not everyone hears them.

So when you have someone like that on the phone, you're like, okay, tell me exactly what you did. What was your situation? Because, oh my God. And I honestly thought she was going to go to a public school. Most people that work their way through. Me, too. So, in fact, she even went to a freaking private school, $37,000 a year, and still did it with scholarships and work.

And never paid more than $16,000. It's amazing. Never paid more than $16,000 for the $37,000. That's the deal. It's impressive. She worked them because they wanted her there. And believe me, if you're a college, you want people like Paige there. Yeah.

They work at getting you there so parents parent these are 18 year olds 17 year olds 15 year olds that are preparing for college they need to get their little butts in gear and get ready and not wander out half drunk out of their senior year trying to figure out what well i just want to go to college like the guy called me up he's like i don't know what i'm gonna do my daughter told me she's going to this expensive school and i'm like well see that's where you get confused in my household my teenagers didn't tell me stuff i told them stuff my daughter told me where she's going with my money how's that work that don't work and so you know we didn't do that at our place

you know we didn't i mean we discussed our place. You know, we didn't. I mean, we discussed it. We had a conversation, but we all kind of knew where you were going to school, in-state where we could pay for it and pay cash for it and not overpay for it. And, you know, the young lady had called me up a few months ago from South Carolina. She wants to go to Ole Miss and pay five times, four times the tuition because she's out of state instead of going to South Carolina in state. Why?

I asked her. The houses around Ole Miss, it's such a pretty town. It is very pretty. No! It's a pretty town. You're killing me here. Oxford. Isn't it Oxford?

It's a gorgeous town. And for a few hundred dollars, you can visit once a year and stay a week. I know. You don't have to pay five times or four times the tuition to go out of state. Dumber than a rock. Unbelievable. Now, though. And I'm paying the bill because she got a federally insured student loan insured by a taxpayer.

But if a South Carolina girl wanted to go to old miss and she had scholarships and had the money to go go you're not mad that go but please don't make your decision based on how pretty the town is geez it's not how you pick your education that's just not good critical thinking skills this is not an art class oh my god it's an education study oh because well okay it's it's an anathema to me that we don't think about education i know but listen this is where this is where your point about the parents being parents is huge because what your 18 year old sees their perspective is right here right their perspective is who's going to what school are they going to going to do a sorority or fraternity? Are they doing an immigrant? Like that is their world. And you, parents, are decades ahead of them.

And so to bring that reality to the 18-year-old is what is key. So yes, you're not picking a school based on how pretty the town is. You're not doing it based on friends. It is what is smart financially and where you can get a good education if you're paying for it. So doing all that because what's going to happen is that 18-year-old's perspective is going to go through four years, five years of school. Hopefully four if they do it in time. And then they're going to be five years out looking back and have zero, one year out. No regrets.

The people that we share the regrets from are the 18-year-olds who didn't have conversations with their parents. They really just signed up for whatever school they wanted to sign up for. Then they're a year out with tens of thousands of dollars of student loans that they're having to pay parents. They really just signed up for whatever school they wanted to sign up for. Then they're a year out with tens of thousands of dollars of student loans that they're having to pay back and they're not able to do things that they want to do. They're stuck. Because of that. So it is. Completely frozen.

It's all they see. So her seeing the pretty town, it's all she sees. So like having people in her life who I'm sure you did on the call from. I was nice. I was nice. I was. I was. I had to breathe, but I was not.

But it's true. But like, that's the thing is like, and I even learned in a book recently, I'm going to I was nice. I had to breathe, but I was nice. But it's true. But like, that's the thing. It's like, and I even learned in a book recently, I'm going to totally butcher this. So all you psychologists out there can correct me. But even like the frontal lobe of your brain, like fully does not become mature until like 25 or something. So they're making these decisions that are going to affect them for so long. And so that's what you have to look at.

You are a loving parent by having these conversations and talking about them. Here's one, okay? Out of all the successful people I know, and I am privy to run around with some uber successful people, I have never met a soul that said, I am successful because I graduated from a college that I followed my girlfriend to. Not once. I selected the college I'm going to based on my girlfriend is going there, and that

led to my success in life. I'll go a step further. You have probably never met someone that says, I am successful because of where I went to school even. That's true. That's true. But they often tell stories, you know, when you get a little older, of regret for the stupid butt stuff that we have all done. Yeah.

And I've got a Ph.D. in DUMB. I've got a whole list of stupid butt stories of things I've done. And, you know, but following your girlfriend to college would be on the list. You don't go to college because your girlfriend is going there. I'm sorry. Unless you can pay for it.. Unless you can pay for it. Even if you can pay for it. This is not a recreational activity.

It's an education. It's an education. This is not how you select your field of study and the place that you're going to do it and what you're going to pay for it. And this is how we have a student loan crisis, is we're financing this crap. The number of people when we did Borrowed Future that we interviewed for that podcast that used their student loans to buy cars while they were in college was innumerable. Yep, for sure. It was unbelievable.

Well, the amount of money that goes to lifestyle is, yes, I know. They live in an apartment with a skylight and a jacuzzi, and they play beer pong on their time off on my nickel because I guaranteed these student loans because I'm an idiot as a taxpayer and I allowed Congress to continue to do this. This is who we're guaranteeing loans for. I'm not arguing.

Just nutty. Nuttier than a fruitcake. So go to a college you can afford. Work. Work. It's not a dirty word. It's not a four-letter word. You're not going to die from it. Right before you die, you'll pass out. Work. It's okay. Work. Work. It's not a dirty word. It's not a four-letter word. You're not going to die from it. Right before you

die, you'll pass out. Work. It's okay. Work. Work. Go to a college you can afford and get scholarships. Parents, parent. This is the Dave Ramsey Show. This is James Childs, producer of the Dave Ramsey Show.

Once again, you made the Dave Ramsey Show one of the top four most popular podcasts last year. To get your daily dose of motivation and inspiration from the Ramsey Network, subscribe or follow today wherever you listen to podcasts.