Tag Archives: Yale

Get Rich Using The Tortoise And Not The Hare Method: An Interview With Get Rich Slowly

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There are some stories in life that truly move and inspire you. To be an inspiring storyteller, is a gift.

However, all talent must be continually used and worked on if you are to turn talent into something great.

That is when you become a professional. What is a professional? Someone who is paid to do a job.

God gives talent. Work turns talent into genius. Anna Pavlova, Russian Prima Ballerina (1882-1931)

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I’ll share with you over time some stories real and fictional that have inspired me on this blog such as Oprah and Jay Leno.

Just to name a few stories, you know off the top of my head, the following:

  • Hearing about strangers helping strangers.
  • People paying it forward by becoming part of an organization as Denzel Washington and Steve McQueen did with their efforts with the Boys and Girls Club.
  • *Just FYI: The actor Steve McQueen grew up poor. The Boys and Girls Club gave him a clean and safe place to be in his youth. He paid it forward after he become a famous actor by asking movie studios to give him thousands of white t-shirts, socks, and personal hygiene products as part of his compensation package for starring in their films. He secretly turned around and donated all this material to the Boys and Girls Club to give out to the young men there. Just melts your heart doesn’t it.
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Steve McQueen also known as “The King of Cool”
  • How the Teenage Mutant Ninja Turtles always looked out for the little guy.
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TMNT film circa 1990
  • The friendship between Shaggy and Scooby-Doo. Those two they just warm my heart.
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Some of my favorite singers that have turned their talent into success are Whitney Houston, Pat Benatar and Toni Braxton.

One of the things I remember Ms. Braxton saying, “music is not about you just saying what you think, but how you make people feel.” Her music and voice have always made me feel good.

Seeing her up on that stage performing recently at the American Music Awards, reminded me of all the reasons I liked her; she has a gift for making you feel good with the words she sings that transcends whatever hard times you are going through in that moment. She makes you feel happy.

Toni Braxton performs onstage during the 2019 American Music Awards at Microsoft Theater on November 24, 2019, in Los Angeles, California. (Kevin Winter/Getty Images for dcp)

And speaking of people that inspire you with their words, I would like to introduce you today to someone who has not only done that for me, but for millions of people around the world through his writing on personal finance. The one and only Mr. JD Roth.

He has turned his passion and talent into success as a successful writer and blogger. I had the pleasure of meeting him in person.

He was kind enough to agree to this interview on Greenbacks Magnet (GBM).

Here at GBM we are all about rejecting buying brand new fresh off the factory floor made cars in order to become Financially Independent (FI).

We pull back the curtains and blow the top off the math, and not the Mercedes, behind how not buying new cars can make you rich.

GBM is the place where we like to get down and dirty into the math behind building wealth, but we keep the jokes clean. Our jokes here are like a Hallmark card, GBM cares enough to send the very best! Even my tweets are called Lipstick Confessions!!! haha 💋Smooches

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Below is just a taste of what GBM has to offer. This blog ages like fine wine; it only gets better with time. No topic is off limits!!! Not even French Fries!!

I’m like Space Ghost Coast to Coast. Booking celebrity guests for my audiences reading and fiscally literate pleasure.

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Fun Fact: The original pilot of Space Ghost C2C was produced in a closet, and the guest was Denzel Washington (second mention in this post cause Denzel is just everywhere). It was green-lit as a series on the Cartoon Network in 1994 and went on to huge success.

Therefore, if you are looking to start a podcast, let this be inspiration to know it is okay to start it on a shoestring budget and in your closet.

Let’s get down to the interview.

Topic du jour: The tortoise wins the get rich race every time. Who is the man behind the tortoise shell?

Subject: Men who talk money. How to Get Rich Slow?

GRS JD Roth: YES, I would be happy to do your interview.

Ladies and Gentlemen, please put your hands together for Mister JD Roth!!! The founder of Get Rich Slowly.

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ALLOW ME TO INTRODUCE MYSELF

GBM Miriam: It was great meeting JD Roth of Get Rich Slowly at FinCon 18 in Orlando.  I had seen his picture on the blog-sphere so many times that I knew who he was on sight. I tried to keep a calm and cool composure, but on the inside I was screaming, “IT’S JD ROTH!!!!!” Over and over in my head.

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Imagine my surprise when I got to ride shotgun with him on our way to a restaurant for a fellow bloggers birthday.

Here I am a total stranger and he was as cool as a cucumber. Totally down-to-earth and fun too. Check out one of his tweets. Hilarious!!!

You can check out more of this story on my post about my very first FinCon called FinCon The Recap from your Friendly Neighborhood Greenbacks Magnet Part I and Part II.

We are in the car with Liz of Chief Mom Officer, Military Dollar, and Erin of Reaching for FI. In a car full of women, he was totally cool driving while listening to Taylor Swift. Yes, I found out that JD is a T. Swift fan. I am too. It’s like john jacob jingleheimer schmidt up in here!!!

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Here is proof here!! I just so happen to think Taylor Swift is pretty awesome too! 😉 Great minds think alike. I literally just posted tweets on Taylor Swift and Lizzo last week. 😂👍

Let’s dive into the interview.

MEET JD ROTH

This is how it feels to meet JD.

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Yes, he was just that friendly and down-to-earth.

This is how I felt getting to interview JD. Over the moon and on top of the world. After three years of blogging, I made it. I’m still here. Anything is possible if you work hard enough for it. 😉So Grateful.

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JD STARTS A BLOG ABOUT GETTING RICH

1. What prompted you to start a blog about money? How much makes you feel rich? Would you say $500k, $1M, $2M, or more? 

I started Get Rich Slowly for three reasons. First, I wanted to document my own journey out of debt. Second, I thought maybe I could help other people learn to manage money as I improved my own financial skills. Finally, I hoped maybe I could make a few hundred bucks per month to supplement my income.

I had NO idea that starting Get Rich Slowly would change the trajectory of my life, financial and otherwise. It wasn’t even something I could have conceived at the time. Yet it changed everything.

How much makes me feel rich? That’s a great question. It doesn’t take much. I grew up poor. My family lived in a run-down trailer house in rural Oregon. My father was often out of work. Sometimes we had to take assistance from our church in order to get by. Today, I have far more money than my parents ever did. I feel very rich. But I don’t know what dollar amount leads to that…

GBM Miriam: Well ok. Thank you for your honesty. It is always appreciated. I fell into learning about money by accident. I was at my boyfriend’s place when I saw a Kiplinger magazine lying around. I just so happened to pick it up…

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2. Any favorite finance books? How come?

I’ve read and enjoyed many finance books, but my favorite books about money usually aren’t actually books about money. What I mean is that often the books that I believe will most help people with their finances aren’t financial books. They’re only tangentially related to finances.

For instance, I think The Seven Habits of Highly Successful People is probably one of the most helpful book anyone can read if they’re struggling to improve their finances. The ideas and philosophy it conveys are so valuable in developing a successful financial mindset.

GBM Miriam: One of my top favorites is The Millionaire Next Door. That and the one you named are some good reading. 👍

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3. What are you reading right now? What’s on your night stand?

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Haha. I always have several books going at once. Right now, I’m reading:

* Wake Up and Live! by Dorothea Brande

* House of Suns by Alistair Reynolds

* Y: The Last Man by Brian K. Vaughan

* Deep Work by Cal Newport

This “many books at once” habit kind of goes against the whole Deep Work philosophy… 

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4. One thing people may not know about you?

When I left for college in 1987, I thought I was going to be a religion major. My aim was to get a religion degree, then become a Christian missionary. I thought I’d ultimately end up as a church pastor.

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GBM Miriam: I did see you mention something about that on your blog. I put a link to that story in your response for readers to be transported there faster than Marty hitting 88 mph by clicking on college in 1987.

5. What’s in your wallet? How did you start building wealth?

These two questions don’t seem related.

I carry a minimalist wallet: https://www.tombihn.com/products/minimalist-wallets?variant=13762302378047

It contains my debit card, my business credit card, my personal credit card, my Apple card, maybe $40 cash, and my insurance info (health and vehicle). That’s it.

I started building wealth through a two-pronged attack. First, I reduced how much I was spending. Second, I worked to build my income. Basically, I did my best to work both sides of the wealth equation (income and spending) in an attempt to grow my saving rate as high as possible.

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GBM Miriam: Awesome. I started by saving $1 a day. Then gradually started increasing my savings and investing rates from 5% to over 40% of my income over like 10 years. I cut out buying crap and clothes to bank that money for my future baby!!

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Well said. So that’s what I did. Unlike that episode of King Meets Queens, when Carrie buys thousands of dollars worth of expensive clothes, keeps the tags on them to return them for a refund (get this because she could afford them *ahem* $2,000 Chanel suits) and said this to her husband…

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If this sounds like you, please stop reading THIS and go read the Get Rich Slowly archives right now! If you want to get rich, cut the excuses and get fiscally educated!!!

If you are truly fiscally clumsy, then try the lazy method of investing. I would use Swensen’s model that he crafted for Yale University. With over $27 billion dollars under management, the Yale endowment is the second largest college endowment in the world (Harvard is #1). Just watch the video. Now you and Rory Gilmore will have something in common.

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And if this is too much, just park your investments into a total stock market fund like the Vanguard Total Stock Market Index Fund Admiral Shares (VTSAX) or Vanguard Total Stock Market ETF (VTI).

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BONUS ROUND

Bonus Questions (pick any of the questions from the top or below that you want to answer) 

6. Any life or money lessons from a favorite movie or TV show you would like to share?

I’m partial to Mr. Roger’s philosophy of loving others and encouraging others to love. He believed in accepting people for who they were, regardless of who they were. I subscribe to that ideal too.

GBM Miriam: Good stuff. I ❤ Mr. Rogers I wanted to take a ride on that train soooo bad! It looked like so much fun.

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7. If you found a lottery ticket that ends up winning $1.5 million. What would you do?

I would buy new cars for me and my girlfriend. I’d get her a Tesla Model 3. I’d buy myself a Mini Cooper — the electric model, if it ever gets released. I’d stick the rest of the money in the bank.

GBM Miriam: A mini Cooper eh? I can dig it.

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But that Tesla looks sexy.

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And love those falcon wing doors.

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Car Magazine UK Tesla photo
Tesla Model X doors


8. Who is your favorite X-men,  Justice League, Avengers or comic book character? Why?

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I’ve always been partial to nerds from the Marvel universe, characters like Cyclops from the X-Men or Mr. Fantastic from the Fantastic Four.

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GBM Miriam: You are probably wondering why I asked this question. Beside being a huge cartoon and Mavel fan, I actually named this blog after a Marvel comic book character; Magneto. 😉

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Just FYI: We skipped a few numbers and moved on to question 11.

11. If both a taxi and a limo were priced the exact same, which one would you choose?

Neither. I would probably walk, if I could.

GBM Miriam: Yeah, that’s me. I love to walk. I’m like Elizabeth Bennett in Jane Austen’s Pride and Prejudice.

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12. What song or songs best describes your work ethic?

“Don’t Worry, Be Happy” 🙂

13. What would you do if you just inherited a pizzeria from your uncle?

I would sell it, if it were profitable. Hell, I’d sell it even if it weren’t profitable. That sounds like too much work!

GBM Miriam: You may be right. I know it’s just a cartoon but they worked the crap out of Doyle in that pizza place in Galaxy High!! 🤣

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14. What was your best MacGyver moment?

This question is so NOT me. I’m not a MacGyver type. That said, my best MacGyver moment was probably installing a new tape deck in the 1993 Toyota pickup I bought last January. Admittedly, I had instructions for this project, but it was still pretty MacGyver-y for me. Now I can listen to cassette tapes as my dog and I cruise around Portland. 😉

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15. If I gave you $40,000 to start a business, what would you start?

I know the answer to this! I’d start a blog. In fact, I’ve spent a similar amount to launch blogs in the past — and they’ve become businesses.

GBM Miriam: Why am I not surprised. 😆 I love blogging too.

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How I feel about blogging: “Tonight, darling, we are going to right a lot of wrongs. And we are going to wrong some rights. The first shall be last; the last shall be first; the meek shall do some earth-inheriting.” -Margo Roth Spiegelman, Paper Towns by John Green

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Cara Delevingne as Margo Roth Spiegelman in Paper Towns
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16. If you had $2,000, how would you double it in 24 hours?

Hm. I’m not sure. There’s no reliable way to do this, of course. My inclination would be to pick a game of pure chance, such as roulette, then to make a single bet that would either double the money or lose it in one go. Using that roulette example, if I bet all $2000 on, say, even numbers or odd numbers, I’d have about a 48% chance of doubling my money and a 52% chance of losing it all.

Really, though, there’s no sure way to do this.

GBM Miriam: That’s JD. He always gives it t you straight and keeps it 💯just how we like it.

For example, he just put this out there for our fiscal viewing. Check out his post on Our first annual family meeting. Bringing people and finances together. As a financial blogger, that just melts my heart ❤right there.

Notes for family meeting

THE END

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GBM Miriam: Thank you JD!!! It was an absolute dream come true and a pleasure to have you stop by Greenbacks Magnet.

It was my honor to be your host this evening. See you at FinCon 2020. The year of perfect vision!!! Until we meet again!!! I bid you farewell.

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Want more fiscal nuggets of wisdom, from the JD Roth?

Find him on his website and connect with him on Twitter at @getrichslowly.

What Is Your Degree Worth

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College is a reward for surviving high school. – Judd Apatow

Let’s face the facts. A college degree is not as valuable as it used to be.

Many folks are landing starting salaries well below what it cost them to get that required degree before starting that job that pays less than what it cost to go to school to qualify for the job in the first place.  

According to PayScale, the typical college graduate with zero to five years of experience is raking in $48,400.

The National Association of Colleges and Employers (NACE) states that average starting salary for graduates is about $50,004. So what does that say about paying $100,000 for that creative writing degree? That it is overpriced.

Let’s get down to brace tacks.

HOW MUCH MORE IS COLLEGE TODAY?

The price of college has now outpaced inflation.

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The average yearly cost of 4-year public college cost from 1971-2016:

2016: $20,967

1971: 8,734

140.1% increase in college costs

During that same period of time wages decreased by 5.4% over those 45 years.

You read that right. Wages actually went DOWN instead of UP with a college degree in your hand.

See my post College Alternatives that could save you $100,000

WHAT IS THE PRICE OF COLLEGE VS THE VALUE OF YOUR EDUCATION?

After you get that degree, then you have go out and get that coveted job. You want a great starting salary, but most employers will tell you they cannot quantify your knowledge but so much.

Really?

Cause college are sure about to slap a price tag on getting that knowledge.

Why not offer the same salary as the cost of the degree?

For instance, if you pay $45,000 for your sociology degree, then that would be your starting salary.

Let’s think about that for a second.

What if colleges and employers printed the cost of degree and payment for that degree? Then you would see something like this:

Petroleum/Mechanical Engineering: Degree cost and starting salary $90,000.

Psychology: Degree cost and starting salary $47,000.

That would alleviate a lot of stress and salary negotiations right there.

THE MOST EXPENSIVE DEGREES ON THE PLANET

“A university is just a group of buildings gathered around a library.” ― Shelby Foote

Education is an asset. And investing a great deal of money in a degree doesn’t necessarily guarantee a first-class education. However, it can alter the trajectory of your life if you are able to parlay all those late nights writing papers into some serious coin.

As of 2019, Harvey Mudd College has taken the crown for the most expensive college in the world costing students approximately $57,401 for the upcoming 2019/2020 academic school year.

If we time that by four, which is being nice considering the average college kid is graduation in 5-6 years, then we get a mind-blowing $229,604!

For some perspective, if we invest that money instead over four years and let it ride, then after 30 years with an 8% return you would have $2,310,426.27! Yes, those four years cost you over $2 MILLION!

You literally could have used your college savings and invested every penny in the stock market and gotten a higher return than what many will get after 10 years of drudgery repaying that $200,000.

It gets even more expensive if your kid starts in at the top and goes to a private school from K-12. This could cost you even more and the losses start to really pile up!

Say those adolescent years are spent in some swanky private school at $50,000 a year. Over the course of 13 years, you would have paid $650,000! Add that $229,604 and you are staring at education bills of almost $900,000!

I would take a check for $900,000 at the age of 22 any day of the week over going to fancy private schools for 17 years!

And just in case you were wondering.

If you invest that $50,000 private school money over 13 years in the stock market, you would have $1,160,746.02 with an 8% return. And add in four years of college, that would net you $1,822,512.19.

Going to public school isn’t looking so bad now is it?

Here are some of the most expensive colleges in the United States and the world.

These 12 colleges are currently the most expensive in the United States:

12. Duke University (18)
2018-19 Tuition & Fees: $55,960

11. Bucknell University
2018-19 Tuition & Fees: $56,092

10. University of Southern California
2018-19 Tuition & Fees: $56,225

9. Tufts University
2018-19 Tuition & Fees: $56,382

8. Amherst College
2018-19 Tuition & Fees: $56,426

7. Franklin and Marshall College
2018-19 Tuition & Fees: $56,550

6. Landmark College
2018-19 Tuition & Fees: $56,800

5. Harvey Mudd College
2018-19 Tuition & Fees: $56,876

4. Trinity College
2018-19 Tuition & Fees: $56,910

3. Vassar College
2018-19 Tuition & Fees: $56,960

2. University of Chicago
2018-19 Tuition & Fees: $57,006

1. Columbia University
2018-19 Tuition & Fees: $59, 430

These 11 colleges are currently the most expensive in the world:

11. Yale University
2018-19 Tuition & Fees: $49,480

10. UCL (University College London)
2018-19 Tuition & Fees: £9,250 or $12,080 USD

9. ETH Zurich (Switzerland)
2018-19 Tuition & Fees: CHF 1,298 (~US$1,310)

8. University of Chicago
2018-19 Tuition & Fees: $57,006

7. Princeton University
2018-19 Tuition & Fees: $43,450

6. California Institute of Technology
2018-19 Tuition & Fees: $45,390

5. University of Oxford
2018-19 Tuition & Fees: £9,250 or $12,080 USD

4. Harvard University
2018-19 Tuition & Fees: $46,340

3. University of Cambridge UK (United Kingdom)
2018-19 Tuition & Fees: £9,250 or $12,080 USD

2. Stanford University
2018-19 Tuition & Fees: $46,320

1. Massachusetts Institute of Technology
2018-19 Tuition & Fees: $47,704

Those are expensive colleges.

Did you know you could go to university cheaper abroad?

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For some perspective on exactly how expensive colleges are in the United States, as an international student you could go to the same college as Prince William and Duchess Kate Middleton for less than it costs to go to Harvard, Yale, or Princeton! The cost is £20,770 or $27,125 USD. That is what it would cost annually to attend the University of St Andrews.

NOT ALL DEGREES ARE CREATED EQUAL

Education is not an equalizer. If you go to the same college as a science nerd majoring in Math, while you are majoring in philosophy, you both are not on equal footing by a long shot.

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In light of the recent college bribery scandal, let’s talk top-tier universities.

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If you were to get an acceptance into Yale or Duke University, congrats to you, as you are among the college elite. However, don’t break out the celebratory champagne just yet.

Although you and another student may be paying the same amount to go Duke, if you major in a different field, then that degree can easily eclipse yours.

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Put it this way. You and another student both pay $48,000 a year over four years. That is $192,000. You become an engineer raking in big bucks right after grad by getting a starting salary of $95,000. Your friend on the other hand, let’s call him Joe, majored in piano or violin and is only able to get a starting salary as a backing musician for $38,000.  

That is a difference of $57,000 a year.

You ask how is that so? We went to the same university. We paid the same amount.

Yes, but your degree is in higher demand than Joe’s.

Then you may ask yourself: Well why didn’t Joe pick a more in demand degree? And therein lies the rub.

Joe is a skilled musician. That is where his passion and interest lie. Even if he would have seen a brochure, which there aren’t any in wide circulation on any college campuses that I have ever been to, showing the starting salaries of majors he still would have chosen music.

The playing field of majors is not level. Therefore, you need to decide before you even step foot on a college campus what you want to be.

This is a small list of what employers are paying for college majors.

My suggestion is that you do a search on what it costs and what it pays to be a lawyer, accountant, doctor, or violinist. When you know what your options are, then you can at least make an informed decision.

College Alternatives that could save you $100,000 dollars

Yale University, Landscape, Universities
Yale University

After seeing it being reported today in the media, that there is a huge college admissions scheme involving wealthy parents (CEOs, Hollywood actors), I thought of writing this post.

I recently wrote a post called Why I Think College Should Only Be 8 Months.

Well, this post will complement that one.

A part two in a series on college.  

Let’s get right to it!

ALTERNATIVES TO TRADITIONAL FULL-TIME ON-CAMPUS COLLEGE LIFE

Here are just a few things I will throw out there. I am sure some of it is already being done, but just not on a massive scale in the United States.

Dear parents of college-bound kids,

I would like to share with you some things I have learned about college alternatives. Here goes.

FLAT-RATE TUITION. How about a flat-rate tuition to help improve graduation rates? Much like a flat-tax would probably improve the economy (and closing loopholes in the tax code), a flat-rate means that once you reach a certain amount, it does not matter how many credits you take for that semester. 

COMMUNITY COLLEGE. Community college is cheaper. You can also transfer to other state colleges without losing credits. Just be sure to find out first.

Starting at a community college or cheaper college then transferring to a bigger more expensive university is college arbitrage. You pay less, but have that flagship college on your resume.

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COLLEGE LEVEL EXAMINATION PROGRAM. CLEP – testing out of courses can save you thousands of dollars.

FLEXIBLE ONLINE LEARNING WITH STRAIGHTERLINE. StraighterLine – an online educational website that allows students to take college courses for cheaper. For example, $99 a month would allow you to take as many courses as you can handle and then transfer those credits to major universities, saving you thousands!

ADVANCED PLACEMENT. AP courses – Advanced Placement testing that could offer you college credits. One student graduated from University of Virginia (UVA) in one year and paid only $1,000! He took so many advanced courses that he came into college with 60 credits and took 18 classes in two semesters and one in the summer to graduate early.

APPRENTICESHIP OR INTERNSHIP. Pick a major early or career path and stick with it. You can always learn on the job or find other ways to learn about a career. Do an internship or shadow someone? Changing majors is costly and time consuming. Changing colleges can be just as damaging without proper planning. Avoid it at all costs.

GAP YEAR. Take a gap year and save. It is no shock that many college students get burnt out. Mainly because they did not decompress from high school. A gap year give students a chance to recover from high school before tackling college.

WHAT SOME BOOKS BY EXPERTS SAY ABOUT COLLEGE

In the book, A New U: Faster and Cheaper Alternatives to College, it states that; every year, the cost of a four-year degree goes up, and the value goes down. The book looks at alternative routes to great first jobs that do not involve a bachelor’s degree. Bootcamps, income-share programs, apprenticeships, and staffing models are attractive alternatives to great jobs in numerous growing sectors of the economy: coding, healthcare, sales, digital marketing, finance and accounting, insurance, and data analytics.

Another book called Debt Free U, I actually read this one, discusses how one student manages to graduate college on-time and with no student loans. He recommends student work their way through school. Find a place you can afford. Make a budget. And find a way to earn the money to pay for each semester. If a semester costs $3,000, then you must first earn that money before starting that semester. He says stay away from scholarships that make you pay a fee to apply. In addition, he also recommends books like The Brazen Careerist and Getting from College to Career.

College (Un) Bound discusses the four-year college experience is as American as apple pie. So is the belief that higher education offers a ticket to a better life. But with student-loan debt surpassing the $1 trillion mark and unemployment of college graduates at historic highs, people are beginning to question that value. The great credential race is having long lasting consequences. Alternatives such as MOOC’s, apprenticeships, trades, and lower cost options are discussed where you can get a top-tier education for middle-tier college prices.

There Is Life After College: What Parents and Students Should Know About Navigating School to Prepare for the Jobs of Tomorrow. Saddled with thousands of dollars of debt, today’s college students are graduating into an uncertain job market that is leaving them financially dependent on their parents for years to come—a reality that has left moms and dads wondering: What did I pay all that money for? The book offers practical guidance for how to navigate life after college.

If you can find a way to cut out taking several classes or shave entire years of college, like that guy in the example I gave above at UVA, you could save anywhere from $500 to $60,000 or more!

Think of it like this.

If going to the University of Chicago costs $50,000 a year in tuition, and you can cut out two years of college by using CLEP, transferring credits, AP credits, and internships; then you save $100,000!

Just some food for thought.

Sincerely,

Your Friendly Neighborhood Greenbacks Magnet

Why I think college should only be 8 months

University, Boston, College

“No. I can survive well enough on my own— if given the proper reading material.” ― Sarah J. Maas, Throne of Glass

Where do I begin?

Let’s start here. The cost of college.

College is expensive. According to the College Board, the average cost of a 4-year in-state public university hovers around $9,970, at private colleges $34,740, and $25,620 for out-of-state residents attending public universities.

Many folks don’t just have $10,000-$30,000 sitting around in their bank accounts.

According to numerous reports, many Americans do not even have $400 for an emergency. How the heck are they going to come up with 10 times that amount or more for college?

I, myself, had to become an extremely massive saver in order to stop living paycheck-to-paycheck.

This required me to become very frugal and find ways to earn more, cut spending, or both from my household budget.

Most of my problem was the revolving credit card debt I had. So, I had to come up with a plan to get it paid off. Every time I paid off one debt, I started saving that money.

I went from saving $1 a day to $13,000 a year.

Want to know how I did it?

See my post How Millennial Money inspired me to start saving $13,333.06 a year

What I really noticed about college besides just the price was that many of the things we’re learning came from equally expensive textbooks. Couldn’t I have saved tons of money by just skipping college and reading the textbook instead? Literally, all I would have needed is the syllabus of the course.

I went on Amazon to see books about the cost of college being worth it. It is right? Well, maybe.

Image result for ivy league admissions chart

The point I am trying to make with this article is to examine the following:

  1. Challenge the conventional wisdom that college will solve all your problems
  2. Going to college will make you rich
  3. Prestige is to be pursued at all and any cost

THE COST OF COLLEGE

It has been well-documented that college is coasting more and more every year.

The amount of student loan debt in the United States alone stands a $1.5 trillion.

I cannot even wrap my head around that number. Basically, it means that many people are either going to be paying back their loans for a long time or will not ever be able to repay them. That is a sad fact indeed.

We are mortgaging our young people’s future.

Many are unable to buy homes, start families, get married, and put down roots.

The cost of college is especially hard to manage for those that are of low-income. The issues of poverty do not stop with a college acceptance letter.

We are starting to create a reality in where the poor inherit their parents’ poverty while the rich hoard opportunities for their kids.

That glass floor is real. When poor kids are getting 1200 to 1600 SAT scores and pulling hard A’s but still unable to graduate, while trust fund babies are barely pulling soft C’s is just ridiculous. That means, a rich kid can get a college degree simply because their parents have wealth, income, and resources.

I have heard stories of low-income college students dropping out for owing less than $1,000 to get their degree. Frankly, this saddens and alarms me.

And I am not buying avocado toast at $10, according to one politician, who will remain nameless.

The cost of a Bachelor’s (BA/BS) degree is just too darn expensive. The worst part is that an education is not an equalizer. Just because you went to Harvard doesn’t mean you are going to get the corner office. That fancy C-Suite is the carrot being dangled in front of all those Ivy League hopefuls.

Many do not make it there.

Don’t believe me.

Check this out.

When I looked up books on colleges, admissions, and the Ivy League online, I found the following titles:

  • Excellent Sheep
  • Nudge
  • No Sucker Left Behind
  • Where you go is not who’ll you be
  • The Chosen: The Hidden History of Admission at Harvard, Yale, and Princeton
  • The Price of Privilege
  • Paying for the party
  • Pedigree Elite: How Elite Students Get Elite Jobs
  • The Blessing of the B Minus
  • Academically Adrift
  • Winners Take All
  • Generation Debt: How Our Future Was Sold Out for Student Loans, Bad Jobs, No Benefits, and Tax Cuts for Rich Geezers–And How to Fight Back
  • Equity and Excellence in American Higher Education
  • How to Raise an Adult
  • iGen: Today’s super connected kids are growing up Less Rebellious, More Tolerant, Less Happy – And completely unprepared for Adulthood

I have read a few of the books listed above. Many are eye-opening recounts of their experiences with elitism, the Ivy League, college admissions, debt, student loans, finances, etc. Paying high prices, as much as $100 an hour for instruction, for college, taking on tons of debt and then receiving low starting salaries.

Stagnant wages and student loans are a dangerous cocktail.

The one book that still haunts me is No Sucker Left Behind. In this book, he describes college as a rip-off as he feels that colleges are involved in price-gauging schemes. Colleges, in his opinion, have become profit-obsessed businesses with an approach that is more reserved for used car salesman.

There are some Ivy Leaguer’s that become Corporate America rock stars. However, the majority go on to careers in the same type of jobs that those that do not go to top tier colleges.

COLLEGE EARNINGS

You think the Ivy League is the only way to go. Well, think again.

You hear all the time that a college degree means higher earnings, like $1 million more in income over a working lifetime. What you do not hear are the tales of people paying $100,000 for that sheepskin and then getting a $35,000 starting salary right out of college.

A blogger by the name of Sam has a website called Financial Samurai. He wrote a very eye-opening article called What If You Go To Harvard And End Up A Nobody?

He looked up profiles of people that went to Elite Schools.

Mostly more of the same from elites: people chasing money.

Surprise, surprise many end up in investment banking and consulting. If places like Harvard are the playgrounds of the rich, then places like investment banks are close behind. The Elite School graduate sandlots.

I have come to believe that you should pursue what is in your heart and your God given talent. Whatever that may be. God does not give anyone anything he doesn’t want them to use. Sacrificing doing any less than your best is to sacrifice the gift. Figure out what you are good at and then pursue that! The money tends to follow.

Some studies have followed, like the one above, people who attended Ivy League schools and others accepted to those schools but who chose lower ranked schools instead.  The result: There wasn’t a difference in lifetime earnings.  In other words, Ivy League caliber people don’t need an Ivy League education to have high earnings.

WHY FOUR YEARS OF COLLEGE?

Remember that $100 an hour for instruction that I previously stated? Due to that, the real cost of college is costing some students $100,000 a year, according to the book No Sucker Left Behind. So, that is what part of the reasoning behind four years is. Collecting the tuition and fees.

The BA/BS degree takes no less than 120 credits to complete.

Why is this?

Should we not question this? I get it. You do not want a doctor that is immature performing surgery on you. However, I value work ethic and experience over age.

Why not have a degree take 48 credits to complete?

How we would do this is to cut out all the unnecessary courses one needs to graduate. Forget the gen eds and endless electives. Stick to what we need to graduate.

A college degree should be done as quickly as possible so that people can get out there and work. Most families do not have 4 years to let junior go off and explore. They need him out there working and bringing home the bacon today!

I read an online forum called college confidential where it asked why is college in America so long. Great question. Here are some of the responses. This is how it went down.

Why is it that it takes so long to get a professional degree in the US?

In order to study Optometry or Medicine or Dentistry etc you need to do 4 years in college first, not even 1 or 2 years but 4 years whereas in the UK the 16-18 education is enough to prepare you for it.

People may want to start/support a family and at the same time pursue their passion but the length of study is off putting.

Answers were the following:

Gen eds.

The US is looking for mature people to be their doctors and lawyers, not a 21 year old whose frontal lobe is not yet fully developed.

If you have many AP/IB credits, you can get your degree in 3 years, too.

I would not want my doctor/dentist to have had only 1 year of formal education.

It’s a business. The more classes one is required to take, the more money the school makes.

What I suggest is that colleges get straight to teaching you all you need to know in your field. This would cut down on the time and expense of school.

And as for those who say people need to mature. Sure, I’m all for that, but how many people know 30 year-olds that are still wet behind the ears? Lots.

If you want people to mature, put them to work. Nothing makes people grow up faster than responsibility and accountability.

If maturity is really an issue, then have people start in at the bottom.

Nothing beats entitlement out of you like taking orders, scrubbing toilets, and fetching coffee.

Make people work their way up. After college, they could apprentice and work while learning their jobs. Get paid to train and work instead of paying for more training. It is just that simple.

I think college should allow student s to do an intensive 8 months and 48 credits

You would take 4 three-credit classes every 8 weeks. This would mean doing 4 eight-week semesters instead of 8 three-month ones. You would earn 12 credits every 2 months.

A college schedule could be like this:

Year One. English, Economics, major, major.

Year Two. Economics, Science, major, major.

Year Three. History, Math, major, major.

Year Four. Economics, major, major, major.

You see what I did there. I focused on the major and getting people out of college. That should be the point of college, right?

Why the focus on finance? Other than the fact Greenbacks Magnet is a financial blog, it just makes sense to teach people about money as they have to manage it for their whole lives.  

After 8 months, you earn 48 credits and graduate. That took less than one year. It also saves you heaps of money. If four years costs you $40,000, then 8 months should run you $6,667. That is huge savings!

I was gobsmacked to hear of doctors owing $300,000 to $1 million in student loan debt. Do you know what type of interest you pay on that kind of debt? It’s immoral.

Interest of 5% on $1,000,000 is $50k a year. That means after income taxes you have to pay $50,000 just to pay the interest on this debt. To service this type of debt, you would have to pay more than $50,000 a year just to touch the principal.  

I remember reading one lawyer say that he expected to have that student loan bill tacked to his coffin.

Just utterly insane!

 PRESTIGE AND CLASS

I read a book called Class Matters by the New York Times and Bill Keller. The book discusses how people chase money and prestige. Class determines everything about you: where you live, who you marry, what you do to earn a living, where you shop, and who your friends are.

The zip code you grow up in can ultimately make or break you.

In the book, it discusses how Americans have long thought of themselves as unburdened by class distinctions. There is no hereditary aristocracy or landed gentry, and even the poorest among us feel that they can become rich through education, hard work, or sheer gumption. And yet social class remains a powerful force in American life.

Class―defined as a combination of income, education, wealth, and occupation―influences destiny in a society that likes to think of itself as a land of opportunity.

What was jaw-dropping was this part of the book: And we see how class disparities manifest themselves at the doctor’s office and at the marriage altar.

For anyone concerned about the future of the American dream, Class Matters is truly essential reading. I agree with that assessment given to the book.

THE CREDENTIAL RACE

Grades are important. Sort of. Those getting straight A’s have to conform. Visionaries are not conformists. A New York Times (NYT) article quoted Dr. Karen Arnold as saying, “Valedictorians aren’t likely to be the future’s visionaries.”

The NYT article also noted the following:

This might explain why Steve Jobs finished high school with a 2.65 G.P.A., J.K. Rowling graduated from the University of Exeter with roughly a C average, and the Rev. Dr. Martin Luther King Jr. got only one A in his four years at Morehouse.

THE REAL GRADUATION RATE

Did you know that the average graduation rate is 6 years?

Roughly 57% of students graduate in 6 years. Only 20% of American students graduate in 4 years.

Most students are not even graduating in the already exceedingly long period of 4 years’ time.

According to Complete College America, for a non-flagship public university, only 19% of students graduate on time and even at flagship research public universities, the on-time graduation rate is only 36%. Only 50 of the more than 580 public four-year institutions have graduation rates above 50%.

According to 2013 data from the University of Texas at Austin, students who graduate on time will spend 40% less than those who graduate in six years.

That means more time out of the work force and more debt.

According to Forbes, staying out of debt and saving are the best ways to build wealth.

WHY SHOULD COLLEGE BE 8 MONTHS?

Why can’t you do your 10-year plan in 6 months? – Peter Thiel, angel investor of Facebook

I whittle it down to this one reason: No student loans or a lesser amount of them.

Building wealth requires you staying away from and out of debt.

They say student loans are good debt.

I say that all debt is debt. You must repay it. Not having to pay back $20,000 or more of debt with interest is life changing.

If you want to be wealthy, stay away from debt. Save every penny. Learn to turn every dollar into two.

Good Luck!

Money advice from Gossip Girl

Earn the spotlight on your own merits. You’ll feel better. – Serena

I was reading a book when I decided to take a walk down memory lane and watch Gossip Girl on Netflix.

For those of you that may not know or remember the show, Gossip Girl was a show about privileged American socialite teens at an elite and exclusive academic prep school in Manhattan’s Upper East Side (UES); whose every move was texted out through an eblast via tips to  an anonymous site called Gossip Girl.

What is Gossip Girl and what it does?

What’s the difference between gossip and scandal? So glad you asked, UES Forever. Anyone can commit a minor indiscretion and generate a day’s worth of buzz. But in order for gossip to birth a true scandal, it requires the right person to be in the wrong place. – Gossip Girl

The show was on the WB, then the CW, and aired from September 19, 2007 through December 17, 2012. The show was narrated by Kristen Bell (as Gossip Girl). Scandals, scoops, and hemlines run amuck. The show may have had a serious lack of ethics, but it did make for some interesting television.

Gossip Girl is based on a popular book series of the same name written by Cecily von Ziegesar. The adapted television series in 2007 came about from the book series she started in 2002.

Gossip Girl will always have a special place in my heart.

It was in 2007 that I heard this line from the show:  You know, Dad, there’s this thing called MySpace where you can post all of this information online. Save some trees, have a blog. – Dan Humphrey

 It peaked my interest in blogging. Then, I started this one, Greenbacks Magnet, 9 years later.

Some of the dialogue may be a bit harsh in its tone and delivery, but there was some truth behind some of their words.

Gossip Girl likes to keep things classy and somewhat true. – Serena van der Woodsen played by Blake Lively

Serena is so grateful because she likes to see the best in people. I like to see the truth. – Blair

So, let’s get right into it.

MEET THE MONEY PLAYERS

You got me thinking. If my class is so important to you maybe I ought to make it worth your while. So for the next seven weeks it’s fewer models and martinis, more flow charts and footnotes.– Colin Forrestor played by Sam Page

Last month, on Thanksgiving Day, I decided to watch some Thanksgiving themed movies and television episodes. And I settled on watching Gossip Girl.

As GG fans know, it just hooks you in with all the drama and high fashion that’s fun to look at.

The music was pretty good too. Found the GG soundtrack for music featured in every episode here. 

The series follows Upper East Siders throughout their never ending drama filled lives that is often self-inflicted. It Girl Serena van der Woodsen is centered around it all and is the star of the show. Her friends and family make up the rest of the cast.

One of my favorite scenes is actually from the first episode of the series. It was a face-off that was incredible between two young women and it set the tone for the show.

The 4 top-billed (in my opinion) and main cast includes the following:

Blake Lively as Serena van der Woodsen AKA S

Leighton Meester as Blair Waldorf AKA B

Chace Crawford as Nate Archibald AKA Golden Boy

Ed Westwick as Chuck Bass Always

If you pay close attention to their conversations, they are dropping some serious money gems.

These little nuggets of life and money wisdom, when interpreted and applied correctly, could transform lives and bank balances.

Let’s begin.

WORK FOR WHAT YOU WANT

Never in my 16,982 hours of schooling have I ever been sentenced to detention. – Blair

Throughout the show, the main cast is always discussing their futures and going to college.

It was almost incessant in the amount of pretentious ponderings of how to be sartorially correct while interviewing for a top spot as a Yalie. And yes, that is a quite accurate assessment of the character known as Blair on the show.

Blair would look and act so innocent and demure like she couldn’t melt butter, but her stare and looks were as cold as ice. Very entertaining.

Here she goes on one of her tirades.

I am so a better fit for Yale than that Rory. – Blair

Now, she’s belittling and disparaging the character of one of my favorite shows Gilmore Girls.

Check out my posts where I talk Gilmore.

Mega Millions Win or Bust 

Money and Life Lessons I Learned from CBS Storybreak’s Yeh-Shen

How to navigate Universal Studios on a budget and like a boss

But enough of the $50 words. Let’s talk about the rest of the show.

They attend the fictitious Constance Billard School for Girls and St. Jude School for Boys. In addition, throughout the show you may hear them casually drop names of other schools.

In the Gossip Girl (book series) — it contains the line “two little Sacred Heart girls in their cute red and white checked pinafores were walking an enormous black Rottweiler” on page 86 in the first novel of the series.

Many of the parents are part of high-society and are on boards of prestigious organizations, own businesses, and live in penthouses. They go to great parties, opening nights to the ballet, and fashion week.

You get the impression that these kids know to base their lives around money and making sure to earn piles of it is a must.

They are tireless paragons of poshness. The parties are lavish, the lifestyle is glamorous, and the fashion is couture and expensive. Makes for a great show.

What I noticed was that everyone in one way or another was working hard at trying to make their own way in the world apart from their rich and or famous families.

They chased their dreams relentlessly. Like a boss.

And made huge sacrifices to get what they wanted.

Great leaders only need three hours of sleep! – Blair

They worked, started or interned at major businesses, magazines, for fashion designers, newspapers, literary writers, politicians, and fashion houses.

You’re not likely to get or keep those gigs for long if you are playing around.

“When and if we end up together, it has to be as equals.” – Blair

Yes, indeed. Be independent.

BET ON SELF

Here’s my advice: Have a little faith, and if that doesn’t work, have a lot of mimosas.– Blair in the Wild Brunch Season 1 Episode 2

My family is really into waffles. – Jenny Humphrey sister of Dan Humphrey played by Taylor Momsen

If you want something, go get it. Have some faith in yourself. And good food and conversation go together.  I have learned a lot about people when having lunch with them. It’s a great way to build relationships. My favorite meal is brunch. I too love waffles!

See my post, Forget casinos, bet on yourself for more on this topic.

THE SO-CALLED ELITE

Their membership is so restricted, it makes Soho House look like a halfway house. – Blair

They say of you want to increase membership to something then increase the selection criteria.

The Ivy League have made this an art form. As you see on this show, even the wealthy were concerned about their college admissions. There was even some talk of donations to a school to get in. In the end, you see deep down, we all have our insecurities. Accept it, and move on.

I have learned that I am no better than anybody else, but I am always just as good.

KNOW YOUR WORTH

You deserve someone who would move mountains for you if he had to. – Blair to Serena 

Normal people don’t get an endless number of chances, no matter the situation. That’s just you. – Dan to Serena

I have heard people say that well-behaved women seldom make history. At least that is what Eleanor Roosevelt said. I guess you can take her word for it as her husband FDR made history.

“I have an idea for you: quit. Your boss is a bi*ch. Let’s go to lunch.”

I have actually done just that very thing. I quit a bad job. Got a better job. And never looked back.

 “I’m not a stop along the way, I’m a destination.” – Blair

That line could be someone’s Bumble Bee bio. I call it sophisticated confidence.

“He ended up treating me like something he owned instead of something he earned.” -Blair

You’re worth more than a guest lecture fee, everyone knows that. – Dan to Serena

Well put. Damn straight!

Be unique. Have your own voice. Be you.

See my post, How being an outlier can make you rich

How being an outlier can make you rich

YOUR INCOME

A man who own a tuxedo shows that he has the means and can afford to provide for his family – Blair in Belles Du Jour Season 4 Episode 1

One of my favorite lines from the show comes from none other than Nate Archibald while talking to Chuck Bass.

Excuse me? Where’s my boy? “Seal the deal.” “Tap that a$$.” “Money marries bigger money.”

Wow. Money marries bigger money. That’s kind of cold, but ok.

I could care less about his Bassets and probably he’s filtering his assets through some foreign government so I won’t know. – Blair on Chuck Bass.

S: So you hired escorts? B, you couldn’t just tell your mom you don’t have friends at NYU?

B: Prostitutes are people, too, and they have a lot of disposable income. – Serena and Blair

Yes, people are focused on income, A LOT.

Jane Austen also so eloquently puts how much emphasis people put on income in two of her novels. And also how to treat others with or without money.

FOR THE LOVE OF HEADBANDS

I know you disapprove of me, but can’t you at least do so in a tuxedo?– Lily van der Woodsen played by Kelly Rutherford

This show loves their tuxedos. And themed parties. Masquerade. Kiss on the Lips. You name it.

It is often said when you look good, you feel good. Well, I concur. You feel more confident as well.

I remember going to a job interview where some folks didn’t take it seriously. I wore a nice dress and some of the men wore suits while others wore jeans.

After I got hired and when I later started the job, I noticed on my first day that all the people that got hired were the ones that were well-dressed.

https://giphy.com/gifs/leighton-meester-gossip-girl-blair-waldorf-xvFtIZNrri95C

Piece of advice: lose the tulip. – Chuck

If you know one thing about GG, you know it’s all about the fashion.

The well-heeled wear nice heels. Blair was known for her love of headbands. People were always giving her grief about it.

Your era is over, and so is that headband. – Jenny

No headbands in college, okay? – Dan to Blair

Et tu, Dan?

SvdW was known for her fantastic sense of style.

And she had more loose interpretation of a school uniform than any person on the planet. The Tie Goddess. See for yourself.

EDUCATION IS PRICELESS AND THE PRICE OF INTELLECTUALISM

S:Wow, and I thought college would be different from high school.

B:Who would want that? – Serena and Blair

These kids were not just applying to any colleges, but the Ivy League. They wanted to be HYPsters (Harvard, Yale, Princeton) or the like.  What Blair called the Holy Trinity of colleges. Which are all expensive colleges. We are talking $50,000 USD per year or more.

It was a constant stressor of theirs during the shows first four seasons. Case in point, here is a list of the schools they were trying to get into or that their parents attended.

For instance, Serena wanted to go to Brown and that college and Harvard are where her parents went. Blair wanted Yale and Nate was considering UCLA over Dartmouth like his father. There was also talk of Columbia, Georgetown, and NYU on the show.

It just goes to show you that getting an education is still mighty important.

Serena van der Woodsen or SvdW for short – Brown University, Columbia University

SvdW parents attended – Harvard University and Brown University

Fun show Fact: SvdW dropped out of Brown at the last minute because she wanted to find herself and she felt that moving away to another city wouldn’t help her achieve that. The classic one-year hiatus otherwise known as the infamous gap year before entering college.

This is what Blair had to say to her about going there.

Your deductive-reasoning skills are perfect for a place like Brown. An enclave of trustafarians and children of celebrities who major in drum circles and semiotics, whatever that is. I can’t wait for you to come home next Thanksgiving a militant veganista, anemic and proud. – Blair

It left me speechless.

Blair Waldorf – Yale University, Columbia University, New York University (NYU), NYU – Tisch School of the Arts

Nate Archibald – Columbia University, Dartmouth

Chuck Bass – Columbia University

Dan Humphrey AKA Lonely Boy played by Penn Badgley – NYU

Vanessa Abrams played by Jessica Szohr – NYU

Eric van der Woodsen played by Connor Paolo – Sarah Lawrence

Some character’s shots at the sheepskin, in my opinion, and other honorable college mentions include:

Reaches: Yale, Harvard, Princeton

Realistic: UPenn, Georgetown, UMiami, Duke, USC, UCLA, Columbia, Tulane, Pepperdine, Wesleyan, Dartmouth

Safeties: Cornell, Vanderbilt, George Washington

READ TO GET AHEAD IN LIFE

I’m telling you, I learned everything I know about women from Judy Blume’s Forever. – Dan

According to List Challenges, “Gossip Girl” (2007 – 2012) : here is a listing of some of the favorite authors and books of the characters or simply the ones mentioned by them and showed along these 6 seasons, books studied in university, etc.

Many characters also name dropped or were caught reading well-known books by famous authors.

I love the Snowflake Ball. It reminds me of Anna Karenina, only by Anna Wintour. – Serena

Maybe if we become famous writers one day, they’ll publish [our letters] after we die, like Sartre and de Beauvoir. – Vanessa

They also liked to travel extensively. Especially, in Europe such as Paris, France. In addition, they speak more than one language such as French while in Paris.

Elliott’s the perfect mix of smart and fun: He speaks three languages, but he has a subscription to People magazine. – Eric

List of titles includes:

House of Mirth by Edith Wharton –  read by Juliet Sharp played by Katie Cassidy

The Lorax by Dr. Suess – Mentioned by Dan

Colette by Gigi – Blair read this on a bench in Paris

Jane Austen books – Pride and Prejudice, Emma, Mansfield Park, Northanger Abbey, Persuasion

Charles Dickens novels – A Tale of Two Cities, A Christmas Carol, Oliver Twist, Les Grandes Espérances

C. S. Lewis books – The Chronicles of Narnia, Alice’s Adventures in Wonderland

William Shakespeare – Othello, Romeo and Juliet, MacBeth, Henry V, Hamlet, King Lear

A few other famous works, Rabbit Redux by John Updike, Cyrano De Bergerac by Edmond Rostand, Les Liaisons Dangereuses, The Crucible (Arthur Miller), Wuthering Heights (Emily Bronte), I Know Why the Caged Bird Sings by Dr. Maya Angelou, The Art of War, The Crucible (Arthur Miller), Madame Bovary, The Old Man and the Sea (Ernest Hemingway), The Beautiful and Damned (F. Scott Fitzgerald), Cinderella (Charles Perrault), The Canterbury Tales by Geoffrey Chaucer, Faust, In Cold Blood by Truman Capote, Anna Karenina by Tolstoy, Walden, The Great Gatsby (F. Scott Fitzgerald), and Beloved by Toni Morrison.

There, I have just given you a reading list that every good high school student or Ivy League hopeful should have. Some of which I have read. My favorite author is Jane Austen. A close second is Louisa May Alcott, as I just love Little Women and the 1994 film starring Winona Ryder. But Austen’s Sense and Sensibility (1995) just amazes me every time. That along with Pride and Prejudice (2005) and Emma (1996).

The rich seem to be highly educated. They also tend to get ahead in life. Therefore, be well-read.

However, these trust fund babies did end up leaving college and higher education after a while to set out for their own fortunes in the real world.

For people like us a college degree is just an accessory.  – Chuck

So, this too let’s you know that it is not always about what you know, but who you know.

You never know who you may run into at expensive coffee shops, libraries, restaurants, college, and hotels like the Palace in New York.

So, go build up those relationships.

MONEY AND RELATIONSHIPS

Just to clarify, I do think you deserve to be with someone who makes you happy. – Dan

True words indeed.

I read, like, five self-help blogs on how to turn friends into lovers. Yes, they used that word. – Dan

Come on, Cece’s heart pumps secrets and gin. – Dan

And there was lots of secrets on this show. Relationships and secrets were everywhere.

Sex is meaningful, like art. And you don’t rush art.– Dan

All great things are built or done slowly.

If you watched this show, then you may remember the season 3 episode with Lady Gaga. Here is her take on relationships that is so Blair Waldorf.

“Some women choose to follow men, and some women choose to follow their dreams. If you’re wondering which way to go, remember that your career will never wake up and tell you that it doesn’t love you anymore.” ― Lady Gaga

Marriage

Settling down means death. Less sex, more silence. – Blair on marriage

Blair also had some of the best lines on the show. EVERY. SINGLE. EPISODE.

Case in point, check this out.

And she actually said this too.

That’s the thing. You need to be cold to be queen. Anne Boleyn thought only with her heart, and she got her head chopped off. So her daughter Elizabeth made a vow never to marry a man. She married a country. Forget boys. Keep your eye on the prize, Jenny Humphrey. You can’t make people love you, but you can make them fear you. For what it’s worth, you’re my queen. I choose you. – Blair

As, I am a history buff and studied up on Queen Elizabeth I of England, my mouth fell open when she said this.

Check it out here.

And I am not the only one who feels she should get some praise for her talented banter.

C: It’s a facility for the disturbed or addicted.

B: You must have your own wing.

C: You don’t get enough credit for your wit.

– Chuck and Blair

If you go back with an uncertain heart, there will be drama and disaster for all. – Blair

You better believe it. In life and relationships, to be successful, you have to commit.

LOVE

B:Love me?

C:Always.

– Blair and Chuck

They were the best characters on the show, in my humble opinion. The two of them together was gold. Take a look for yourself.

But ultimately, I have learned that love is what we are all looking for.

MONEY DOESN’T BUY HAPPINESS

Trouble is moving in, and it’s looking to make the Upper East Side it’s bi*ch.– Gossip Girl

You would think that folks in tuxedos and ball gowns are the happiest, but these people seemed so unhappy.

Happiness can’t be measured in things. It comes from having the things that really matter like people who love you for who you are.

Doing the right thing takes courage and strength. At least that’s what I’ve heard. – Blair

Well, I hope you had fun going down memory lane with me and I will bid you adieu in the best possible way to end this post.

You know you love me – XOXO,

Gossip Girl (I mean Greenbacks Magnet) wink, wink 😉

Meet an orthodontist with $1 million in student loan debt

Unless you have not been reading headline making news lately, then you have heard of the man who ran up a tab of over a million dollars to become an orthodontist. It was featured in the Wall Street Journal and has attracted a lot of attention. His name is Dr. Mike Meru. He owes approximately $1,060,945.42 as of the reporting of the article in May 2018. There are only 101 people with $1 million in student loan debt. He is one of those people. Here is how this went down.

HOW TO GO FROM DEBT FREE TO OWING $1M IN 13 YEARS

Mr. Meru grew up in California. He has two brothers and is the eldest of the three. His parents said they would help pay for college. He got through undergrad with the help of his parents and by working through school. He graduated in 2005 from Brigham Young debt-free.

From there he decided to go to dental school.

Before we go any further in this story, I want you readers to know that becoming a doctor is incredibly expensive. It is not uncommon to have medical students be in debt for hundreds of thousands of dollars. Anywhere from $200,000-300,000 in medical school debt is their reality.  Dental school is also one of the most expensive programs and can cost upwards of $70,000 or more per year.

Getting back to Mr. Meru, he was informed that going to dental school would cost anywhere from a price tag of $400,000-$450,000 in student loans plus interest.

For me, this is a red flag. Even if you can earn a six-figure salary as a doctor, I am risk-averse and would be turned away by this eye-popping amount. However, if your goal is to be a doctor and be of help and in service to others, then this is what the cost will be.

FROM $0 IN STUDENT LOANS TO $340,000 IN FOUR YEARS

He then chooses one of the most prestigious institutions for dentistry: University of Southern California.  This is what he paid for four years of school from 2005-2009:

Year one at end he owed: $43,000

Year two at end he owed: $115,000

Year three at end he owed: $230,000

Year four at end he owed: $340,000

Dr. Meru has now finished dental school. He owes over a quarter of a million dollars in debt within four years of graduating from college debt-free.

Keep in mind that college tuition goes up every year around the country. USC is no exception. In addition, interest rates have gone up on student loans as well. In the WSJ article, his loans were at various interest rates throughout his time at school. Also, tuition increases at USC would go for about 6%. This is a huge amount of money. For instance, a 6% increase over 3 years would be the equivalent of an 18% increase in tuition by overall from start to finish.

The cost of college is going up faster than the cost of inflation. Generally, inflation goes up by about 3% annually increasing the costs of goods and services. Therefore, if it cost a dollar ($1.00) last year it will now cost $1.03 this year. Imagine paying 6% on $50,000 and then 6% on 53,000 and so on, all the while you are also accruing interest on this borrowed amount.

You are getting hit with a two combo even worse than Mike Tyson could ever do.

First, you get hit with tuition increases of 6% in this case. Second, you pay interest on the loans you take out of approximately $50,000 per year. The compound interest is brutal.

In the article, it states that Dr. Meru found his calling as orthodontics changed his life as a teenager. However, the one caveat he did not take into consideration: inflation. If you want to learn more about inflation, read my article Money Lessons I learned from Scrooge McDuck. The cost of becoming a doctor 20-25 years ago was cheaper then as it is way more expensive now.

This is not the first time I have seen people take bets like this on their education.

If you were to do some research, you will find that 50 plus years ago education was pretty reasonable and in many cases more  affordable. I will provide one such case below.

In the book, Generation Debt by Anya Kamenetz, a Yallie that was born toward the end of the 1970’s, stated in her book that her parents old college professors were in shock at the sticker price of Yale over a seven year time period which had risen- from $30,000 to almost $39,000. Her own father, who attended Yale on a scholarship, had appropriately asked the justification of the tuition increases. This considering when he went there the price was…wait for it…$3,000. That means within one generation tuition has increased $1,000% or to roughly 10 times the cost.

The absolute saddest and funniest part of the book, in my opinion, was at the high school graduation brunch of her younger sister. Her parents also wanted her sister to go to Yale, but cited cost concerns and rightly so. The speaker said of the 180 graduates they would divide $18 million in scholarships- that’ll just about get them to Thanksgiving. That was putting it mildly.

The problem is that education is not an equalizer. Although, there is nothing wrong with getting a good education. And going to a great school with high-quality education is awesome; some people may have to simply understand that it may not be the best option for them individually.

The jury is still out on the value of an education. Sure, they let you know on college brochures and in the media that a college degree can net you more than $1 million more in lifetime income, but in Dr. Meru’s case did it also say that if you flip a coin, it could be the opposite and you could owe $1 million dollars? I don’t think so.

Many employers are paying in wages nowhere near the cost of college.

I have read that some places cannot put a dollar amount on how much to pay their employees for their degree, but colleges have put a price on it as USC cost Dr. Meru over $400k.

FROM $340,000 IN STUDENT LOANS TO $601,506 IN THREE YEARS

You would think by finishing dental school that his education was done and over with. Alas, then there is residency, which is training for doctors. However, for dental specialists this costs too. Many doctors are paid while in residency, but Dr. Meru must continue to pay for training for an additional three years FROM 2009-2012. This would increase his debt to over $600,000.

FROM $601,506 IN STUDENT LOANS TO $1,060,945.42 IN SIX YEARS

Pay close attention here because things move really quickly.

He consolidates after finishing all his education and training. He then owes $724,817 by 2012-2013. This includes in interest and principal as a consolidation not only changes your repayment terms, interest rate, and payment amount but interest can capitalize. Capitalization is what makes student loans such a slippery slope. It makes you owe interest on top of interest making it harder to get it paid off.

From there he continues to accrue interest and owes $882,300 by 2015.

Within 3 years, interest continues and grows the debt to $1,060,945.42 by 2018.

How is this even possible? In 2005, Congress created Grad PLUS loans that removed loan limits and allows student to borrow for every expense from tuition to rent and living expenses. Dangerous.

He is now making monthly payments of $1,589.97. He has two daughters, a wife, a $400,000 mortgage, a $225,000 salary and is accruing $130 per day in interest on his loans, which is $3,900 per month and $47,000 per year.

If not for Income-based repayment, he would have to pay $10,541.91 per month. Instead, he pays about $1,600. This does not pay all the interest that is accruing and does not even touch his principal. Within 20 years he will owe $2 million. If forgiven, he will owe $700,000 in income taxes. Currently, his take-home pay after income taxes is $13,333 per month. That means if he pays the $10k monthly payment, he would have his debt paid off in about 13 years, but bring home less than $3,000 per month.

 WHY SO MUCH DEBT?

Keep in mind that it is mostly graduate students that end up in the most debt. With the cost of graduate school (2-4 years) easily topping $20,000 or more per year, it can dwarf undergraduate costs. Over 20 years ago no undergrad or graduate students owed six-figures of student loan debt. Today, over 2.5 million of graduate students do.

After reading about Dr. Meru’s story, I feel that there is a serious problem with the funding of higher education. I want people to be doing the opposite of owing interest on a $1 million and instead be earning interest on this amount of money.

I want people to have the trifecta of retirement funds- pension or 401(k), savings, social security. Over a 30 year career you want to have a paid for home, 25 times your annual income in a retirement account, and be able to get social security or have at least two forms of income to supplement your savings.

In the article, his wife said there are a few things that are OK to go into debt for: a home, an automobile, an education. I have to disagree. I say if you can avoid all debt, then do it. Pay cash for all your purchases. For a car you need one loan. Same goes for a home. However, her husband needed 50 loans to fund his education.

If you are unsure why or how you will pay cash for all purchases, let the advice of these millionaires be your guide.

Mark Cuban, billionaire owner of the Mavericks, says if you use a credit card, then you do not want to be rich.

Kevin O’Leary, shark tank entrepreneur, says all debt is evil.

David Bach, financial advisor and author of the Automatic Millionaire, says all debt is bad debt.

I rest my case.