Borrowed Future | How Student Loans Are Killing The American Dream

you graduates are coming of age in  an amazing time as americans we enjoy   more freedoms and opportunities than  citizens in any other nation on earth   so my american dream is pretty simple my american  dream is just not living paycheck to paycheck   we have the chance to get an education and work  hard and give our children a better life you don't   go to college you you don't get a job like that's  the only way you can make a living for yourself   the challenge for our generation is to create  a world where everyone has a sense of purpose   from a pretty early age i knew  i wanted to be an orthodontist   what has always been certain is the ability to  shape that destiny my mom was a teacher i just   ended up falling in love with history and went  down that track you will be happy you will be   successful and you will make a difference in  the world congratulations on your graduation a college degree is a signal attend the best  possible university you can get into you'd be   wrong to forego a college education the return  on a college education has never been greater   what it is a signal of is i am able to speak  a certain way and understand a certain set of   cultural tropes and this group of people maybe  not so much financing college is very tough for   millions of americans tuition has gone through the  roof post-secondary education is now the largest   source of consumer borrowing behind mortgage  loans so many families are borrowing to the teeth and the thing that we say to  these kids is do this shtick   in high school and it will get you into  college and then we say now do it again   and it will get you a job they fell into  a trap our society is created for them   student loan debt has been steadily increasing  affecting approximately 44 million americans   the cost of getting a college education  is having a lasting effect on graduates   it's just so natural like everyone does it this is  good debt thirteen thousand dollars can turn into   25 000 easily there's a good return on investment  i'm paying all these bills and i have nothing you   did this to chase the american dream that we all  cherish people are alive but not living this is   not the way the american dream was set up you know  here i am 36 i have a million dollars in student   loans every piece in the system did what it was  supposed to do and the victims are 17 years old   the stories all come down to one theme how has  this happened to me when i did everything right i remember mad when i was you know 17   a guy walked in from a local college there  in the city of fayetteville and said hey   if you haven't started thinking about  college education you are you are late and if you really want to be successful you have   to go to college because if you do not  go to college you will not be successful   i didn't know how to process it my entire young  life i was never taught the proper education   of what i needed to be successful i was just  told go to college you will be successful and   if you have to take out student loans that's okay  everyone is doing it and i became like everyone the culture in the last three to four  decades has dramatically shifted it used   to be that we said education is important study  something so that you can further your career   it moved from that to where education was  permission to play you weren't going to be   valid in the economy unless you had a four-year  or more degree not only is it necessary   but it's like a guarantee that you're guaranteed  to be more successful and so you have to have   this because a degree is the answer society has  rules and the first rule is you go to college   you want to have a happy and successful life you  go to college if you want to be somebody you go to   college if you want to fit in you go to college is  a four-year college degree still a good investment   i mean not surprisingly the principal you think is  a good a good investment for a couple of reasons   one a student is going to earn a million dollars  more over their lifetime career if opposed if   they didn't have a college degree they'll be more  nimble they have lower rates of unemployment even   robert johnson said they're going to live longer  because they're likely to have better insurance   okay we set the table in such a way that we doomed  millions of parents and kids to take the bait   when we elevated the pursuit of a  four-year degree to here we inversely   relegated a two-year degree or a community college  or an apprenticeship program or all those other   things down here higher education became a  thing everything else became an alternative   there was some studies that came out and said if  you have a college degree you will make this much   more in your lifetime that became the marketing  slogan for higher ed which is if you come do this   you make more money the shift of a public good  turned into a private good i'm getting my degree   so i can make more money for me then the markets  got involved and this thing was not something we   all invested in like roads or police or fire  departments it became a way for me to get rich   the cost of college has grown faster than the  cost of energy and the cost of real estate the   cost of health care all of it somehow we got it  into our heads that it's priceless and we've told   an entire generation of kids if they don't borrow  whatever it takes then they're going to enter into   this crazy rat race hopelessly disadvantaged  so you had a 17 18 year old kid being told   to sign on the dotted line or else his parents  aren't cautioning him not to do that guidance   counselors aren't saying hey take a breath  be careful nobody is i think where this   really becomes a crisis is millions of people who  faithfully pay their student loan bill every month   where that debt is having an enormous implication  on their lives and their communities things like   the ability to buy a house save for retirement  what career you choose even if you're gonna start   a family it's this unintentional consequence of  just living in society and being surrounded by   everything that says spend and have a certain  lifestyle and it's okay to borrow and to go   into debt and just make sure you can afford the  payments they're just following the normal path normal ended me in the back of my car  because i didn't have nowhere to sleep   normal ended me in the ymca washing myself  because i didn't have a home to go to and   take a shower before i even  turn 19 i'm 35 000 in debt i was that young kid thinking  about committing suicide i was that young kid wondering  how am i going to eat it was during that season in my life that i   decided that i'm i'm sick and  tired of being sick and tired i'm tired of not being able to have the options  what can i eat what can i do where can i go   and so i got myself out of debt   learned a lot about money learned  a lot about life all right anthony had to lose some friends had to better myself and i said when i get out of this i want to be  in front of young people and help them go after   their dreams but make sure that their dreams  do not become nightmares and when i look at   this table i see dreams but if it's going down  the wrong path i also do see future nightmares   and so i'm excited to be here with you all  tonight is to have a conversation about   your life and what you are experiencing you  all are about to step into the real world   what is one thing that you're feeling about  graduation so once i get out of high school   i gotta make sure i get the right steps to  make sure that whatever i do going forward   can put my kids in a better situation  than i am does that make you fearful   though are you nervous about that yeah god i'm  a teenager you know i make bone-head decisions   so like my small decision can play a big  role in my future hey but you know what   at least you admit that right unless i'm a  teenager i'm gonna make some dumb decisions   what is one decision you're scared of making  i want to enjoy my life to the fullest   cause i live for now and then i also got to live  for the future so you don't know which one you   want to choose my mom tells me all the time to do  what makes me happy you support me 100 um but then   i also have my dad um he tells me look you have  to pick something it has to be something that's   high paying because you have to feed yourself you  know and we're in a society today where you can't   just not go to college or like well you can but  it can be a little rough of course growing up your   parents always tell you you can do anything you  want to do you can do anything you put your mind   dude if you work hard in high school and you  keep these good grades and take these classes   you can go anywhere you want to go  well they don't tell you that there's   a 180 000 price tag attached to it so do  you think college is the only way you can   be successful in life yes always going to college  is like a safety net no matter what you do in life   no matter what dreams you chase if you have  a degree to fall back on you're always safe so my game plan was the game  plan that everyone else had i'm gonna apply to get student loans i always thought everything's just gonna  be fine everything will sort itself out college was always in the picture older brother  went to college older sister went to college so   me being the youngest also go to college  and get the best i can for myself for that first year it was 24 000 i didn't work i played three sports so  to me it was really easy just say this   money will just take care of itself i'll  make enough money went off to school and   didn't really worry about it for a year until we  had to do it all over again free money free money get out the notes that we started on before  we're gonna keep going over values and beliefs   and things that we have in our society  that tell us what we can and cannot do   and so on from there i met  josiah through mutual friends   we were only dating for a couple months and he  just brought it up and i didn't even think twice   about it like everyone had it like that's fine  whatever and i don't think it really hit me until   like the week after we got married we got  a decent amount of money from our wedding   and that instantly like went straight to like  all of our bills and then like it was gone everyone in the pictures and they're so happy  holding their diploma walking across the stage   by the time the graduation ceremony  was i had realized it's not this happy   go lucky time i had taken out about a hundred and  ten thousand dollars in student loans interest had   been gathering the entire time that had ballooned  to 125 000 after four and a half years of college   it was something that i was not prepared for it  was an avalanche coming down on me i had a total   of 11 separate bills coming in the mail for 870  some dollars that i was going to pay per month student loans on the table for you yes  man you jump straightly yes bro i mean   i'm not the first i'm not gonna be the last  like because that's the only option i mean   technically no my thing is whenever you wanna  do something you gotta take the good and the   bad with it yeah so like my thing is if you want  to be real successful you might have to take on   the debt but it's you going to work hard to get  out of that ditch but how much that is too much   what are you really yeah like that's the whole  thing when it comes to the student loans so like   what what does you feel like it's an enough risk  for you yeah and in life like everything sucks   everything has like a backdrop everything has a  trade-off you're never gonna get the good only   you're just choosing what sucks less yeah that's  true i know people that are planning to die with   that debt like they're only paying interest  i'll take the bloke like give it to me you know   so you would hold that burden for the rest  of your life yeah paying off student loans   hundreds and hundreds yeah like when you won  something really bad you got to take all of it   this is probably one of if not the most important  financial decisions in your life and i think a   lot of this stems from this unfortunate thought  that we don't need to worry about student debt   because it's quote good debt there's something  about like the word student being before the   word loan that just makes us think about this  differently and like differently in a very bad way the student loan problem has reached epidemic  proportions the curve on the growth of credit   card debt even though it's been ridiculous  has been much more gentle than the curve on   student loan debt it's gone to a mushroom  cloud in terms of the mathematics on it   the problem is is that you don't register  emotionally that it's money i mean when you borrow   money to buy a 20 000 car you have a completely  different emotional experience than if you write a   check or put down twenty thousand dollars worth of  benjamins right there you having them you have an   emotional experience that you do not have when you  just sign and go i think i can make those payments   it's the same thing happens with student loans  there's a whole lot of people who have a big   target on your back who view you and your ability  to take on a ton of debt as their chance to get   rich college tuition has risen enormously over the  past five decades why would someone pay for this   well everyone seems to agree that graduating  from college is a guarantee to a better life   so it's no surprise that the student  debt level has risen exponentially   as people pursue their shot at the american  dream but is the payoff really there   well when the student loan program was first  started by the government it had really good   intentions students could only borrow up to a  thousand dollars a year for school the expectation   was as students completed their higher education  they would in turn contribute their knowledge and   skills back into society and the money for all of  this came directly from the us treasury but as the   demand for higher education grew so did tuition  now the government had to open up the student loan   program even more so they brought in the banks  that meant the government didn't have to foot the   initial bill anymore but they still guaranteed  the loans if the borrower couldn't pay it back   so the banks they were getting paid  one way or the other and on top of that   they got to collect any and all interest from the  loans in business this is called making a profit   so fast forward tuition is still rising because  the demand for college wasn't slowing down   and the banks they couldn't keep up this is  where the government stepped in and created   the student loan marketing association more  conveniently known as sally may as a government   sponsored enterprise they were designed to funnel  money into the student loan program they would buy   the loans from the banks which allowed the banks  the cash flow to issue more loans and over the   next two decades sally may became a major player  in the student loan market but in 2004 sallie mae   cut their strings from the government and became  a fully private company and this meant they were   a real business a business that exists for one  thing to make a profit this is where the student   loan program went from being a public good to big  money actually this isn't even a program anymore it's an industry the real mail in the coffin though came a  year later when sally may convince congress   to make private student loans nearly impossible to  discharge through bankruptcy this has resulted in   growing default rates record amounts of interest  accumulated and dragged out repayment plans   that never go away now we're left  with entire generations of people   trapped in student loan debt who took it on in  hopes of making a better life for themselves   because that was the original goal of all this  but it's companies like sally may naviance great   lakes thea osla nelnet and countless others  whose pockets are overflowing with the money   your future was supposed to be built on so with over 45 million americans sharing  this 1.6 trillion dollars of student loan debt   the question still remains hey guys it's  lacey and i am broke as [ __ ] 200 000 172 000 in debt i went to a regular ass day  school i have only paid off seven thousand   two hundred thirty one dollars and eleven cents  how much interest have i paid in thirteen years   nineteen thousand thirty dollars  and twenty seven cents holy sh   i got in there one day and it said your loads will  be forgiven if you die well that's that's nice so i feel like my time in college wasn't  really the ideal picture that i had at college i feel like college is supposed to be fun  and the time that you're away from parents   and rules and can make your own decisions  but my college was pretty much filled with   how am i gonna make sure i'm stable my view is like it's not the end of the  world it's normal it's life to have dead   everyone has debt everyone has it so it's  fine brush it off don't worry about it when i got my final financial  aid report and i seen   how much more money i needed you can't  start class if you don't have a zero balance i had to do something i couldn't  get that amount of money from home   i talked to the financial aid advisors that we  have at our school and they introduced me to loans i did look at it as it was  investing in myself like it's okay but then once i realized i had to continue to   take things out it was like okay wow  this is like adding up very quickly   it became a thing of like   dreading the fact that i'm gonna owe  so much money when i get out of school that is when it like hit me the hardest it's  like you don't want to have to being dead   and so you try to comfort yourself  with the notion that it's normal   but you don't want it so it's like a constant  like dissonance and conflict going on through   your whole collegiate career because you're like  yeah i'm excelling as far as i'm getting a higher   education but at the same time i'm going to be  just like everyone else working to pay off debt the weight that people feel from this decision  they haven't even made their first rent payment   on an apartment they haven't had to have their  own bank account for a lot of students like their   prefrontal cortex isn't even fully developed  yet and yet we're saying do you want 50 000   in student loans that's a lot to put on  an 18 year old especially when you have   well-respected adults working at banks or  admissions offices saying you know hey this   is a great thing just take out this loan it's no  big deal people shouldn't leave college in chains   from the decision to get an education that  helps them contribute to society that is a good   thing it's really sad to see people struggle as a  result of this great decision to get an education and add another one to add another one to the  list yeah they said some of these other bills   were going to be a little bit lower but you never  know so we might even have additional stuff too so   come back on groceries yeah so if we can change  like what do we need we need about 60 bucks 80   bucks so if we can choose you think oh i have a  house we have a car we have jobs like we're fine   we're the average american but we weren't making  ends meet we were living paycheck to paycheck and   i thought i made a decent salary we get the taxes  this month it puts us at about 20 short so if i   go donate plasma like another time that's another  20 bucks or so yeah depending on which one it is we are on our way to lima to donate  plasma uh it's something that i   do usually every tuesday and  thursday after football practice split outside linebacker's wide out widen out  have to stay in still quarterback is still   your guy because if they do a crossbow  i'll be home till about eight or so but   gotta make this a little bit extra money somehow that money i make during the month or donating  is a big difference in my life people say like   i go through a crazy schedule but you know  i've left courtney at home for the last   12 plus hours i worked in works and works  and i worked at a job i didn't like but   i had no choice like i have  student loan payments to make   i didn't make enough money to pay it off  in 15 years like the plan they wanted me to   they're gonna take me 30 years to pay off i  took up credit cards when i was on college   because that's what you do i still had a  car payment at that time too i was broken i'm paying all these bills and i have nothing i want you to be successful i want each and every  one of you all to go after the american drink but   i got to ask you this question what is one thing  that can stop your dreams dude say it again did   say that one more time did my man you gotta take  debt off of the table i'd rather take six years   to graduate debt freed and freedom graduating  four and i spend the next 30 years paying back   my sick lunch let's be real if all of you all  went to college didn't listen to my advice today   two of you all will graduate from this table  with a hundred thousand dollars or more in debt   studies are showing that the average person takes  them 20 years to pay back their student loan debt   let me go deeper studies are showing that y'all  right here young people when you graduate college   the number one goal in life is not to  get your dream job number one goal in   life is when you graduate college it's not  to go out there and buy you a nice car and   it's not to go out there and buy a house and start  a family you know what the number one goal is for   college people who are just now graduating  pay off sickness is that the american dream no   the number one mistake i see with your generation  is you take a kids approach to an adult decision it's funny talking with my mom and getting  her story of you know i went to college   for four thousand dollars and thinking to  myself that's cool it's not that cheap now growing up we were more in the lower middle class   a single mom who has two boys you could tell  that we didn't have an endless supply of money for college i ended up opting to go the business  route i saw what the financial situation was like   and realized if i could create a business and  grow that and then be able to give back how   much more of a difference would that make  if i could fund 20 of me to go to college u of m in minnesota was my big choice  it's a very large substantial campus   and you get this sense of pride you know walking  into that situation knowing that this is where i   could be cutting my teeth for going out into  the real world so one day go to the mailbox   i got in that's what i wanted i was totally set  on going there i'd done everything i needed to   up into that point basically i could coast out  my senior year right i made it to the next step   that's the funny part they don't send  the tuition with the acceptance letter   that letter also had shock you open  it up you look at it and 22 000 a year   at that time i'm driving  a car i paid 600 bucks for   i was totally ready just to dive deep into debt  because that's what the journey looks like right   that's what everyone expects it to  be and i was gonna be one of them what college are you going to i haven't like  got my financial package from duke yet but   duke is my passion why is duke your dream school  um i've been to the campus i've toured and i fell   in love with it you fell in love with like the ex  like the classes the people there the overall like   experience of being there their connections how  much is duke gonna run you um yearly about 75. oh it's undergrad so i'm still thinking about uh  yeah that's 300 grand yeah no for a degree yeah   what about you nyu really nyu yeah why is that  your school because it's like saturated with music   artists with with producers with opportunities  just out at every corner for music in particular   how much is it uh 75. oh my gosh 75 000 i'm  gonna reach for what i can and if nyu is it   then i'm gonna reach oh my gosh i was so  serious please stop stop don't leave us   okay so i toured buffalo back in  november and i don't know i feel   like it'll be a lot like high school as  far as like arriving like there like i   know my parents talked about like college  was like the best years of their life and   died and so i feel like the experiences that i'm  gonna get at college are gonna be like unmatched   so you're going all the way to buffalo state  just to have an upgraded high school experience um yeah keyword upgraded well if i wanted to sell  a college to the normal group of semi-unmotivated   semi-uninformed people i would  start with the football team i would move on to the parties i would then go on to uh shiny pictures  of people at graduation we are we are   i wouldn't mention student debt i wouldn't  mention all the hours you have in between class   because most colleges aren't good  at helping people through that   picking a school is a complicated process between  applications and essays and costs and visitation   and the stuff out there on the web it's it's  just overwhelming the average person doesn't   know what to look for because this isn't their  world and then all of a sudden you get thrust   into it and it's information overload and how  do you synthesize it into something that makes   a whole lot of sense the new 30th edition of  best colleges was just released this morning   and we've got it brian kelly is editor of u.s news  and world report good to see you again brian kelly   this is getting to be an annual visit we like  it if you were to ask me what's the worst thing   that has happened to higher education in the  last 20 or 30 years i would say unabashedly   a fledgling magazine decided to start ranking  colleges which schools will have the greatest   chance of giving you the american dream the usual  suspects i have to say princeton harvard yale   columbia stanford are the top five the whole  world wants to go to these places education is   a brand now it's a label that's an industry one  of the things u.s news and world report measures   is the percentage of people the college rejects  that the more people you reject the better college   you must be i always look at their alumni they  are they're very loyal alumni people who go to   princeton love princeton they give it money they  come back they stay engaged with the school that   makes a difference and then they came with this  ever-evolving matrix of points really important   things like your reputation how other people think  about you it turns into a higher ed arms race it's   like nikes versus gucci they're both shoes they  both work the same but one has more value because   of the name some colleges figured out if they  made their dorms nicer or their gyms fancier   more people would want to come what's up with  their dorms what do they have beautiful campuses   yeah 10 different residence halls there's a food  service it's pretty awesome if more people wanted   to come they discovered that u.s news and world  report would rank them higher do you accept bribes   only very large ones i have been lobbied by some  of the finest people in the world if u.s news and   world report ranked them higher more people wanted  to come if more people wanted to come they could   charge more because their piece of paper was  worth more so the ratchet kept turning and it   kept turning and it kept turning the parents are  demanding the college students are demanding it   you have to build it otherwise they won't come  because your college isn't good enough the idea   that you can spend four years not living at home  going to class three hours a day yeah that's   the definition of privilege wherever you came  from best campus food i mean it is fabulous wow   so let's be really clear you shouldn't go to a  famous college there's no reason i hope you go   to a great college but i also know that some of  the cheapest colleges in america could be great   if you make them great if you use your time there  to have a series of experiences to change your   life and other people's lives because that's what  you get you get four years of freedom and leverage   what are you going to do with it because  if all you're doing is saying i'm going   to give up four years of my life and all my  money for a piece of paper at the end well   it doesn't make sense to pay what  you're currently paying for the paper what really was apparent to me was how  much debt can be that ball and chain on   your ankle when you actually hop into the real  world once you can change that mental state of   debt actually doesn't have to be an option i can  do this a different way there's a newfound freedom   that comes with that going forward with  school i knew that i wanted to pay for it later on in my senior year when i went  and toured wisconsin lutheran college   i went to the school with the mindset i'm gonna  hate this i was thinking am i shorting myself by   going to a small school will i be able to get the  job i want to because i went to a no-name school   everybody knows university of  wisconsin-madison the badgers how many people know the wisconsin  lutheran college warriors   as exciting as d3 football is i knew  we weren't gonna be known for that   but then when that tuition bill came paired  with some scholarships that i earned in high   school meant i wouldn't be going in my first  year that was an eye-opener i'm convinced that   most of the mistakes around college are  simply college choice it's it's simple 30 years ago the difference in cost of a community  college a state school and a private school was   not a lot and the difference in what you got 30  years ago in terms of the quality of education   was a lot the weird thing is is that the quality  of education has come up on the community college   so much and on the state school so much  that they're almost all three parallel now   but the cost went dramatically different but  here's the thing a lot of people get the basic   knowledge of business the basic knowledge of  a communication the basic knowledge in i.t   field at a community college and get a really good  career out of it information is just much more   accessible now than it was 30 years ago to the  average person so let's talk for a second about   whether you should go to college at all given that  every single course at mit is available online for   free given that with motivation you could cover  four years of college coursework in a year that   there are ways to cobble together what you would  learn in college and even show up with a degree   without going in the front door without paying  full price and the giant shift that's happening   is that the people who are hiring what they want  from you is not that you went to a school with a   better reputation or at least a better football  team what they want from you is the real skills   creativity honesty directness leadership  resilience and i think we've got to strip   away the easy and fun part stop rewarding it stop  confusing it with a useful signal and instead   get back to the hard part which is how we're  going to be productive generous human beings i'm not i'm not really going to college to get my  degree i'm going to get the knowledge so my plan   was to go keller's right that's like yeah harvard  for innovation it is yeah and then i was like i'm   set but then two schools here have animation  programs i was like you know might as well   i go and check out lipscomb's animation program  and it's the the professors are disney animators   so it's like what i'm getting here in my  home state and home city and like for free   wow instead of getting into like 400k debt right  it's like why would i not you know wow yeah so   you turned down the harvard of animation to come  here turn on the channel okay you're banking on   student loans and work if not it sounds like you  may not be going to school that's the reality   i've come to face this year you still may not  be able to go to school or your dream school i wouldn't be able to be comfortable at school  but if i don't go to my dream school because i've   picked my dream schools to be the schools that i  would be happy at that i would be comfortable at   why it's like it's the price you pay for   certain things in life because i could skip  out on college and go work a full-time job   won't have any debt but i won't be happy can't  come up with 13 000 a year so you can't no no i honestly didn't know how i was  gonna pay for year number two you go through the first year of  bliss but when the tuition bill hits   and you get that letter in your mailbox  that says tuition is going up for next year   no one wants to pay more money for school i was fully prepared to take a gap year or do  anything to avoid having debt my second year and   continuing on college tuition can now cost as much  as 50 000 a year but luckily one woman says she's   figured out how to get a college education for  free christina ellis earned half a million dollars   in scholarships and is the author of confessions  of a scholarship winner welcome christina nice to   see you a lot of times whenever people hear that  i won a half million dollars in scholarships they   sometimes assume that like i just got to pocket  anything that i didn't use and they're like   where's the car that you bought and it's like no  that's not how it works that being said a really   cool thing about pushing for a lot of scholarships  is that you can actually get a refund check if you   live off campus i would actually get like a ten  thousand dollar check each semester to be able   to pay for my housing and my books and meals and  transportation so winning scholarships can allow   you to have a lot of freedom and flexibility with  how you live your life while you're in college   what are your thoughts on scholarships are  you all currently applying for any right now   yes and it's like i don't know where to look  right and it's really overwhelming because   you hit so many dead ends it's like 10 million  scholarships it's just it's overwhelming it's   strange to the library and got scholarship  books in their garbage like i'm trying i was aware of scholarships honestly they were  just a hassle just too many non-guarantees in   that when i could be working because most of them  only range from like 200 to a thousand dollars   and that doesn't even put a thump in  how much tuition is at most universities i think it's great to have a conversation  about scholarships your freshman year because   it gives students time to develop  a resume without a lot of pressure   that being said a lot of students think that  it's too late to apply for scholarships if   they've already started college and that's just  not true there are scholarships that are available   for students all throughout their college  experience the gap is really there's a lack   of financial education inside of our schools and  in two this is a lack of wise counsel along this   journey and we're not taking the time to teach our  young people to step back and to do the research   if you spend two hours filling out an application  that allows you to win a thousand dollar   scholarship that's like making 500 an hour that  is significant i mean what other part-time job   in high school are you gonna find that makes that  amount of money i decided i want to make looking   at scholarships like my full-time job if i just  hit one of those 500 scholarships after applying   for 10 of them it's still worthwhile so much of  it is about habits and just getting in a groove   of consistently putting in the effort it doesn't  have to be so overwhelming if you just break it   down into manageable steps you may have to  come home spend two hours spend three hours   on the internet grinding you may get a lot  of no's but that one yes that second yes   that third yes is going to be worth all the no's  that you got scholarships are a great opportunity   there are millions of scholarships given away  every single year for so many different reasons   you can win a scholarship for  being tall for being short   there's a vegetarian scholarship there's a  scholarship for being a golf caddy for having the   best zombie apocalypse escape plan the criteria is  so broad that it's a numbers game in many senses   don't write off the 500 scholarship don't  write off the thousand dollar scholarship   because those are often where students find the  most success there were some i didn't find out   until the last second and there were some that  i got that i didn't even know i was going to get if you were still enrolled in a university you  should still do your research and try to find   scholarships if you are currently taking  out student loans to get through school   take a moment to do some research and see  the vast options available where you do not   have set goals and you do not go through a  series of behaviors with intentionality you   are never going to be in that area of your life  successful and college is no exception to that   every single day you're being intentional  about the decisions that you make that's   going to get you in college and through  college without borrowing a dime it sets in once you apply for graduation it's like  okay i will no longer be in school so i no longer   have that crutch of putting it off because now at  this point i am going to have to come up with a   plan as to when i'm going to start paying it back  off how much i'm gonna have to start paying back   off and what i can even afford to pay back off and  there's a bunch of stuff that come with adulthood   that you just don't account for it does kind of  make me worry about what am i going to do then   you know like i don't want to still be paying  back student loans when i'm supposed to be   nearing retirement but being realistic and  like looking at it's like well maybe i won't be   because 13 000 can turn into 25 000 easily  depending on how i manage that because it's a   lot of my peers who leave a four-year university  and still don't have a job for six months and   that's where you have to start paying back  your student loans so it's like what do you do moving to van wert we tried buying a  home like it wasn't a very nice home but   it was in well means and we applied for loan and  got denied definitely like put us in perspective   like we would never get a house we wouldn't be  able to have kids like we're not going to be   able to live we had a point in time where we  actually did not go shopping for a full month   and we didn't have food outside of basically some  boxed pasta and like watered down spaghetti sauce   because we didn't we did not have  enough money to literally go afford to buy groceries and that's with every credit  card maxed out everything like just literally   backs to the wall pinned up against it like we've  officially hit rock bottom i just looked back   at that money amount and realized like what what  did it actually get me i know it got me a college   degree and i know it got me experiences but the  college degree and experience is worth 125 000 we don't think anymore we just do so much of  our mental health challenges in this country   are because we let our feelings and our emotions  drive our day college choice is no different   we've gotten so unintentional about it and then  we figure out we're going to pay for it later   now we blinked there's a couple of trillion  dollars floating around out there on the backs   of 19 20 25 year olds 40 year olds it's  just becoming like a car payment like a   mortgage that's just a payment we have that's  a way of life and we've got to recenter that so who's the first person on the schedule it's a  consult okay when i was 10 i got hit in the mouth   of the golf ball so it like broke my two  front teeth and unfortunately i was the   one that hit the golf ball so it came back  and hit me right in the mouth i was kind of   in and out of the dentist office as a kid so  that's what got me interested in orthodontics i got out of undergrad debt-free but then  it uh quickly went the other direction finished dental school i had probably  somewhere around 400 000 in in student loans ortho and oral surgery are the  two most competitive residencies   and a majority of programs i mean they only have  three or four seats each year and they probably   have 1500 applications so i mean you have to be up  in the top of your class to even get an interview   all right you just got to stay biting  down to hold that in place for me okay once i was in residency the  tuition was 95 000 a year i mean at that point i mean what  i didn't have any other options   it was either you know you're not gonna be an  orthodontist or this is what you're gonna do there is a quote-unquote bottomless pit of money  if you will i consider private loan folks the same   as payday lenders there's always a place to go  find money right it's going to cost you your soul   but there's money out there if you want to  go do the things you got to do to go get it we're seeing private educational loans becoming  larger and larger and larger where there's no   real governmental control like there is under the  federal programs for those you're at the mercy of   your lender and for that i can't tell you what's  going to happen but you're at the mercy of a   private credit-based lender and you owe  tens of thousands of dollars good luck think about it like a car payment you've agreed  this much money over this many months at this   much amount to pay it back when you don't we want  it give me your pound of flesh now and that pound   of flesh can come in all different ways but they  have to sue you to get that then you have now   a judgment against you that they can then do  other things for instance garnish a paycheck   if you have one garnish a bank account if you  have one you possess a vehicle if you own it   to be made whole because they light you money  what we also have to think about though with   that is roughly 90 of those are co-signers  so the co-signer could be mom or dad grandma   and grandpa is a huge one and there's nothing  worse sitting around thanksgiving table telling   grandpa you can't pay that and grandpa already  knows because he was served with a lawsuit too   we had borrowers with private student loans where  they would be paying their loan on time faithfully   and their like parent or grandparent who co-signed  their loans died and instantly despite the fact   they were paying they're like now you're in  default give us all give us all our money i   had someone she was in a horrific car accident  paralyzed her and um her mother was killed in   the car accident which triggered the default  on the private student loans she was hoping to   get back to work she was you know working for her  degree in nursing and she had a closed head injury   and i thought okay this this is the case  this is it we can do this um and the court   and that at the end of the day  because she was gonna qualify   most likely for on social security disability  that meant that she had the ability to pay it back but i want to try to figure out how  to make stuffing i think if i add some   broth to it it won't be so good it won't  be dry yeah but we'll try it and see   one way to find out when it came to student  loans like you could get whatever you wanted there's problems on both sides of that  the people that are giving the money and   the people that are taking the money  i mean 95 000 times 15 residents   you're talking 1.3 million  dollars in tuition from 15 people and the international residents that were  there paid 140 000 in tuition every year 140.   you're you're a number you're you're a paycheck and who you're surrounded by in those years  are people who probably know nothing about   personal finance have the same loans that you  have and you literally just you do everything   you can just to not even think about it it's not  like i'm getting a loan and they're giving me   the money and then i have to actually give it  to the school i never saw it it was scary but   at that point you're just like whatever man  with all the interest and everything that i   already had on my loans i probably had 500 or  600 000 i'm like sure just throw it on there you want to go ahead and take  him back and do that okay it's a ton of money and it is it's scary and i  think early on too it was just we had to have   like a lot of like hard conversations about it how  are we gonna pay it off do we just go on a minimum   repayment plan and you just pay it off for forever  like how do you even begin to get out of it   the people who are writing the loans and they  don't care i just got an offer on my student loans   like oh you qualified to lower your your interest  rate well why'd you wait till i have 300 000   in interest to lower my interest  rate why don't you lower it before   because you just wanted all the interest these student loans you know they never go  away unlike so much other debt that can be   forgiven you know in the wake of a bankruptcy  for instance it's like stepping in gum man it's   with you forever and ever and ever so it is  accruing about 6 000 of interest every month mr frostman you are now recognized for  five minutes to present your oral testimony over the course of the last decade i traveled all  across this country talking to thousands of people   in big cities small towns and nearly every slice  of america in between and from these conversations   i have found that one aspect of life cuts across  the fallout from extraordinary student debt there are now more than 8 million student  loan borrowers in default we had a million   student loan borrowers default last year a year  before that the year before that year before that   so if you do the math that means every 28 seconds  another student loan borrower defaults on its loan on top of that we have three million more  borrowers who are behind that's over 10   million people or one out of four student loan  borrowers who are having their financial lives   ruined as they can't make their payments people  with student debt have just felt invisible   you take on debt that's what you're supposed to  do this is good debt stop complaining but the   ramifications for your financial life are the same  if not worse like student loan borrowers have less   rights less protections and we use the full weight  of the government to make sure you pay that back i look at all the things that are going on  right here and i'm just article after article   what certainly seems like a very large amount of  corruption in 2009 sallie mae's ceo said quote   if a borrower can create condensation on a mirror  they need to get a loan this year in order to put   their subprime lending in place navien forwarded  wrong information to credit reporting agencies   saying that permanently disabled veterans  had defaulted on their loans when they hadn't   then you have itt credit union using financial  aid staff to rush students through an automated   application process when they knew that they  had projected default rates as high as 64   so they were setting people  up to fail these are a series   of public policy choices at the federal government  at the state government that have gotten us here   i think this is the intersection between so much  debt and illegal practices right because there's   this enormous mismatch between what borrowers are  promised and what's happening on the ground and in   between our student loan companies this is not  just some one-off company or like one bad apple   you see players across the student loan spectrum  who just view this as their chance to get wretch my name is lynn sabolsky i am a former employee of  nadine's call center i thought it was going to be   a really easy straightforward job that i would  understand the rules that i would perform well   the longer i was there i started to notice red  flags people were being asked to lie people were   not being given the right information in general  there was just this oppressive environment that   wasn't really allowing the representatives  to do the job that they were being paid to do there is a memo that navient council told and  had the mantra to the people that you would   call those customer service people for bear  for bear for bear get these people that way   forbearance an agreement to postpone your loan  payments while interest continues to accrue when   naviance puts an account in forbearance they  get to collect the interest those loan balances   increase they are now collecting interest on top  of interest that is the most beneficial scenario   for them we sued one of the biggest student  loan companies in the country navient and a   single claim as part of that lawsuit documented  how the practices of this company added 4 billion   with a b dollars of unnecessary interest onto the  most vulnerable borrowers mr fuhrman our friends   across the aisle have mentioned that student loan  services are supposedly not incentivized to steer   borrowers toward forbearance and that they are not  financially incentivized to give borrowers poor   or outright incorrect advice yet an audit released  by the doe in february this year found that more   than 60 percent of the department's oversight  report contained examples of servicers acting   improperly if our friends across the aisle are  correct and loan services are not incentivized   to make mistakes and give poor advice then why is  this consistently happening because they're wrong   because they are incentivized to give bad advice  they're incentivized to get their call reps off   the phone as quick as possible which we see across  the industry leading to the outcomes we have today   this part of our training was keeping your calls  to seven minutes if i don't keep my call to seven   minutes i have a lower status at the end of the  day i'm considered not having performed as well   if you're a representative and your choice is give  this person the help they need or get in trouble   in some way shape or form then really you're  you're pitting one person against the other   i was talking to my coworkers over lunch and over  break and a few of my co-workers said that there   was just no way to answer all of those questions  in a way that was satisfactory and maintain the   numbers that we were maintaining and so they  would be on their call and then they would   just press a button and go oops we're sorry dial  again funny enough navient's still in business   making a kajillion dollars a year and still has  contracts with the federal government angry yet on the shoreline of maui's wailea beach at the  luxurious fairmont hotel sallie mae executives   and more than a hundred of its employees are on  a five-day paid trip celebrating a record year   5 billion in student loans to 374 000  borrowers planning session and recognition of   accomplishments for our sales force  has been something that has been done   i'm going to say since the company was founded  in 1972 and it's recognition of the hard work but   it's an important piece of planning i think we're  done that is like a general sentiment that we hear   frequently which is we love getting the money  to be involved in the student loan system   but when it actually comes to doing the work to  help borrowers to avoid the defaults you know   how dare you accuse us of of being part of the  problem and so we sued this company in court   and one of their top legal arguments  were judge you should dismiss   this case because we have no actual  responsibility to help followers i'm being cheated out of my paycheck i could retire two years after  i'm done paying my student loans   it's like paying for retirement and literally  never seeing a dime of it ever again   you should know the names of the companies that  have targeted your constituents citibank discover   bank navient fia quinn street sallie mae sofi  transworld wells fargo and the list goes on in a way there's no morality in the student loan  system because there is no one that's going to   stop you from borrowing at the end of the day  it's just you know you type a couple buttons in   and on the other side there's a student loan with  some numbers that is the most personal it gets so this right here is my uh college  diploma um don't even take it out of the   envelope in fact i had to have my mother mailed to  me because i didn't know where it was so let's see stamped signed and sealed that's not going to ever be framed i'm not going  to ever leave this envelope again and ensure i   can have the degree allows me to do something  that i love to do in but this piece of paper   is something that has brought a lot of pain  in my life i don't really want to look at it you can talk to someone who's graduated  10 years ago and they still owe   student loans so it's like if  i can meet a complete stranger   and this is what we have in common that's an issue the borrower slave to the  lender and like that's so true when you have this kind of debt or  really any debt like you you feel that   it changes who you are and how you can behave it changes your life   you've arrived at your destination the choices  that they made now own them and they were led   down this primrose path by a set of values put  on them by a series of guidance counselors and   parents who weren't thinking educators who were  out of control and a congress who continues   this ridiculous student loan debacle and here  they sit trapped and they do not know what to do i try to do this without crying i feel like  when he told me how much shitload that he had   it wasn't gonna make me change  the way i felt about him like   you're dead is it bringing  you down as a person you know   millions of americans are struggling with the  same problem like it's not just your fault i like i don't care how much diet he'll  ever have like i would still always love him but i don't think he realized that i feel like i've failed as the provider  as the husband because i'm the reason that   we're in so much debt we only had a total of  about 142 000 120 some of that is my college it's literally like saying you're the reason  your team is losing if they if you weren't on   this team we'd be winning but because of  one thing it takes everybody down with it the first hardest thing it was for me was  right after we got married we could not go on   a honeymoon and i know that sounds like cliche but  like you don't realize you'll never have that like   moment that like time again like newlyweds get to  go to like this awesome place like it's something   you look forward to when you get married and  like we lost out on like that time that was hard   i know she still loves me no matter what and  i'm so grateful for that but it stopped us from   being able to get a house when we moved  down to vane where and it stopped us   for a long time from not having kids like  i'm not being the man that i'm supposed to be looking at you know what it's gonna look  like to actually attempt to to pay it off   paying somewhere around ten thousand dollars a  month you know sounds like it's gonna you know   actually do something but it's not gonna do  as much as you'd like to think that it will at some point it's gonna have to be you  know you're paying 20 30 40 000 a month to be able to pay 30 or 40 000 a month i mean  you gotta you gotta be making a lot of money you know i think realizing you know what it  is um it just uh you know just knowing that you know it's probably not going to be possible   you know without the help of god i mean  how am i gonna make that much money but all you can do is try so there are a lot of people who quite rightfully  say i did everything i was told to do now i'm   in a boatload of debt i'm not happy about  it how are we going to keep this cycle   from repeating itself well to the first group  of people i'm sorry that you shouldn't have   trusted the system the system let you down how  do we keep from repeating it is stop telling   people this is what they're supposed to do stop  telling people that this is the path it might be   easier it's definitely more fun in the short  run but here it is with subtitles this is not   what you're supposed to do what you're supposed  to do is figure out how to make a contribution   not figure out how to make a marketing industrial  governance system happy in the short run what was the first step you took in terms of  you getting out the lifestyle that you were yeah changed my mind what are you putting inside of  this that comes out of this that comes out of this   a degree that y'all are trying to get is  a small degree when it comes to your life   this right here is everything and when  i changed what i was putting up here   that's when my whole life changed each and every  single one of you all need to have a clear vision   of what you want to do the vision is not   i want to go to this school i want to have this  experience no what is the vision for your life i want to have options i want freedom the question  is are you willing to put in the work up front   if you can grasp that you will be successful going into my senior year i knew it would be close   i can do the math so can you working at a normal  hourly job would not pay the necessary 14 000 i   needed for school i knew what i had to do i went  for something with more opportunity and that was   a sales commission job and really went and made  the most of it usually work four days a week ten   hour shifts and then on my off days i would sell  lawn mowers and flip them driving across the state   hey how's it going good how about you good   it's right over here little did i know  that there was so much opportunity in it well i know you had it listed for  six but just take five on it cash we gotta teach young people how to  really take ownership of their life   if they're paying something out of their pocket  they will take their education experience a little   bit more serious because now they can say my  parents didn't pay for it we paid for it this is   just simplistic to me it's something i understand  and i don't think lawn mowers is for everybody   someone who's interested in shoes would  be better suited to do something like that   as long as you have knowledge in an area you can  probably figure out a way to make money with it   during this expensive period if you have the  resources and the time how will you choose to   spend it so that when the system tries  to squeeze you you can say no thank you   got these pictures uploaded gotta do  some cropping get them posted then wait there was one guy i bought a bigger zero turn paid  1700 bucks brought it home washed it listed it   sold it for 2 600. same day my mom would just be  dumbfounded are you sure you're allowed to do that   mom it's selling lawnmowers i don't know what else  you want you definitely have a lot of noise around   you saying take out loans you're not able to do  this once you find that window of opportunity   though and realize that if you repeat this  process over and over like i did with lawn mowers   there's just so much empowerment and that feeling  of running after this goal and chasing it down and   putting everything you have into it that's hard  to explain all right she's all ready to go yep   when you start opening your eyes and  looking to these unique opportunities   you can add value in unique ways all good in total that summer i probably made around 13 000   at that point i could say i'm getting  out of these four years debt-free i don't know for a while to go here but we are oh sweet that's cool so i remember once when i was in  undergrad and i asked my history professor why   did they send all these 18 and 19 year old u.s  soldiers to the normandy innovation and he said   something that shook me he said because any combat  veteran who saw that plan would have said no way d-day worked because of some extraordinary  planning some extraordinary sacrifice and what   he said was good old-fashioned unabated american  teenage arrogance because they got up in front and   told those boys nine out of ten of you will not  come home 90 out of 100 of you are not coming back   and those guys in line went sucks to be that  guy right and they did that all the way down   because when you're a teenager you're invincible  that's gonna happen to somebody else and so i have   to know no matter how honest i'm being and  how upfront i'm being hey this is expensive   and you're gonna have to pay this back i have to  know that my end consumer the 18 year old's going   okay we'll get there and has no understanding  of what seven hundred dollars a month actually   feels like out of a 2 400 a month paycheck i'm  just i feel like i'm just so worried about like   having to sacrifice my happiness for like a  cheaper route like having to sacrifice what really   makes me happy and brings you joy on a day-to-day  basis just to save money like happiness is worth   anything like you know what i mean like that's the  part i'm confused on like if you're not happy in   life at that given moment no matter what it takes  what does it really matter the happiness later on   i'm not saying you can't be  happy i want you to be happy but i feel as if your happiness comes from  something that is outside of education   and i feel as if you're looking for something to  confirm something on the internal side of you not   something to help you grow as a man because if  you're looking for the education then you can get   the education anywhere but from what you said you  just want to go there so you can have a good time   i would really step back and  ask myself what's more important   happiness for four years that cost me 30. or  a little bit of happiness but hard work that   really makes me happy for the rest of my life and  if it was me i'm saying man i'm putting into work i look back at my four years  and this is the time of my life   i got to travel a bunch for really cheap  been to alaska california texas florida but the reality is it's not the buildings it's  not the sports it's not the land around the school   that make the experience that's all up to you  it's not the school that's gonna change that so which one of these are you sitting i'm way   like over there you'll have to get your  binoculars out and squint a little actually   i did you know what the difference is between  a normal person and someone who is not normal   is the not normal person was willing to do the  things that normal people are not willing to do   i do not want to live the majority of my life not  being able to do what i want to do because i got   to pay for things in my past that's the normal i  refuse to be a part of students need to begin by   saying i refuse to be brainwashed into believing  that if i get into a good college it means i'm   better than if i don't so go find a door you can  afford and go through that door and figure out   how to marshal the resources you need whether it's  scholarships or only going part-time or taking a   gap year and working like crazy to put 25 000 in  the bank so at least your first year you're not   starting with free and easy money you're going  to be paying off for decades it never was the   degree that caused people to succeed it was the  knowledge base the tools in their belt to be able   to get their work done that's what caused people  to succeed it still is what causes people to   succeed whether you can demonstrate that you have  the skills to do the job is going to be a much   higher indicator than where you went to school  or for that matter even if you have the degree   i think there's a real opportunity for guidance  counselors and parents to talk to their kids   about how they want to work as opposed to what  they want to do i think a smarter thing to tell   a person who's trying to figure  out what to be when they grow up   is to say put it all on the table and if you do  that you're liable to be a very happy satisfied   plumber making six figures a year or perhaps  running your own mechanical contracting company   it's not the job that makes you happy it's you so  what this is really about is freedom it's about   earning the freedom to decide what you're going  to do next david james wilson bachelor of arts   business administration summa [ __ ] laude here's  the secret to you while being successful you're   not looking at the picture today you're looking  at the end picture what kind of future do you want   and the choices you're making now will impact  it i can choose what opportunities i want i can   choose where i want to live i can decide my job  i can focus my time on things that matter to me   which will lead to greater satisfaction down  the road the best feeling is knowing that   this journey that i'm starting with the rest of  life i don't have to carry any baggage with me can you imagine getting off that stage  going home walking into your job for the   very first time it's your career and when you  get that first paycheck that paycheck is yours can you imagine having freedom  at 22 making 35 40 45 000 a year walking the stage debt-free is not  just about walking the stage debt-free   but you're walking into life debt-free welcome and so

Channel: The Ramsey Show Highlights

Views: 614,689

Keywords: Borrowed Future | How Student Loans Are Killing The American Dream | Documentary, borrowed future full documentary, full documentary, ramsey documentary, student loan documentary, debt free, college debt, student loans forgiveness, borrowed future documentary, borrowed future, student loan forgiveness, Borrowed Future | How Student Loans Are Killing The American Dream, borrowed future dave ramsey, borrowed future full movie, Borrowed Future - YouTube

Id: W7krdoXswQA

Length: 88min 34sec (5314 seconds)

Published: Tue Oct 18 2022