Amanda-Amanda and I am a writer, entrepreneur and something of an adventurer and I write at about money and life at Millionaire By Next Year
Michelle-I want to hear about the adventures
Amanda-After college I won a scholarship and lived in the Middle East for a year. Then I worked several jobs when I started my career in D.C. and then I drove around the country and I’m about to live in my Suburu Outback full-time in Texas
Michelle-How are you going to manage the heat in Texas?! And I hope you go to Marfa
Amanda-I went there and I saw the Prada store.
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Welcome to Michelle is Money Hungry, a podcast that has real and empathetic conversations that often focus on the intersection of policy and the financial conversations we are afraid to have. I’m your host, Michelle Jackson and this summer I’m having conversations all about the potential for student loan forgiveness and what will happen if we move forward with the policy and what happens if we don’t.
Show Notes
Michelle-I do want to touch on something connected to your opening comments related to you living overseas. I worked with a lot of students who came from Gulf Nations and one of the things that stood out to me was how their countries invested in their education. Their countries paid for their students to come overseas and I’m bringing this up, I’m wondering what were some of things that you may have noticed around the conversation connected to education.
Amanda-I actually lived in Jordan, I lived in the north near the Syrian border outside of the Expat bubble. What was interesting for me to observe was that other countries invested in their students to study abroad. What was interesting for me to observe was the sheer number of Syrian refugees who had transferred to Jordan and the ease that they were able to do that (from my vantage point) The cost of education was significantly cheaper. The sheer number of students who were able to transfer was something I noticed. Learning is a tool people use to move their family forward and here it feels like we use education as a means to an end.
Michelle-Why did you start Millionaire By Next Year?
Amanda-I started it in 2019 and I was still working as a Defense contractor with the Department of Defense and also was running an oat milk business. The logic behind it was that I really enjoyed writing and other people had kept me from doing it and it was a way to write. I also wanted to learn how to run a digital business and learn new skills for this economy. I was struggling with my finances and learning about FI and FIRE and had gone down the Dave Ramsey route. You’re not finance in school, so the blog was a way to learn more and leverage my writing skills and build something on the internet that I owned.
Michelle-Where are you?! When someone brings up SLF as a policy what are some of your concerns, etc. Share your thoughts about impact good or bad
Amanda-The biggest thing that no one is talking about that underpins this conversation is the morality of debt. So much conversation around cherry picking who gets what. We’re in such a politically charged world right now and the moral underpinning is connected to that from the far-left or far-right. Some people want to start and let’s just start from a clean slate. Other people who opted not to go to college or had paid off their loans and people are wondering what about me? We need to figure out what is best for the economy, moving forward and starting fresh.
Michelle-No one has brought up the idea of debt morality before. I think of all other things that I pay for as a US citizen that I’m not excited for. Why is it that people silo their anger around this policy. They’re mad that there may be SLF but they don’t seem to be mad about other things. For example, paying for the Ukraine war effort. Then, I ask myself why don’t we also help our own citizens.
Amanda-It’s not just what we’re paying for but how we’re showing up. We didn’t design all of this. We’re not voting on how much tax we’re being charged. We have never been given any vote or say about how we participate in our economy. I’m thinking about how I’m moving back into my car and housing isn’t affordable. I don’t want to own a home, but I can’t justify renting either. One of the things that has liberated me is realizing that I’m not always at fault for the financial decisions that I’ve made. For example, I kept moving when I was in D.C. looking for more affordable housing. I was working in an economy where wages have stagnated. Meanwhile the cost of education and housing have gone up. We have to bridge the gap between these expenses and so more often than not we use credit. A lot of people have told me that I’ve made bad choice or maybe I didn’t and the market is making me make the choice between paying 50% of take home pay on housing. We’re not thinking of the macroeconomic world we’re living in and how things are interrelated.
Michelle-My guests are pretty consistently frustrated with the costs of education in the US. What would you do if you were the head of the Department of Education, what would you do related to managing the cost of education
Amanda-The question isn’t a matter of adjusting the cost, the question is, is college sufficient anymore? It’s totally divorced from the workforce. Look at tech. Kids aren’t going to college and learning code. The kids that are coming out of college are getting jobs due to the pedigree of the school that they attended. Based on proximity to Silicon Valley and branding students graduating from schools close to Silicon Valley will have students do better. Google is now providing certification that students can take direct from Google. Creating their own in-house credentially program. Stop making college this moral thing and see what we can do without college to start training students for work.
Michelle-What would you do to design a SLF program? If you were in charge of issuing these loans what would you do to keep students from being financially burdened.
Amanda-Making student loans a collateral based lending product. If you wanted to buy a car or a house the financial scrutiny is tougher than getting student loans. I was 17 when I went to college. There’s nothing underpinning these loans. Tomorrow we could go to a bank and request an unsecured student loan and we would have to qualify for these loans. The 3 things I would require 1. A national service requirement for SLF 2. A blanket forgiveness vs. all of these qualifiers and there is a historical precedence for this back to Biblical times. Debt Jubiliees-Hemerabi wiped away debt. More recently, Iceland eliminated a substantial amount of mortgage debt. 3. Maybe participation in local communities.
Michelle-What should we be thinking about in regards to folks who are in school now? How can we protect them?
Amanda-That’s on us to really be transparent as we can to be transparent with these students. Such as pay transparency. They don’t know what they will be compensated. The younger generation can’t make informed decisions without this information.I had no idea what Deloitt was. If you had told me to interview with a big 4 firm, I wouldn’t have known what that meant. When I was starting out, interns were still unpaid.
Michelle-I’m GenX and we’re definitely the first generation to get slammed with the expense. I didn’t get career advice. I was told go to college, get an education and you’ll get a job. I never had a ROI conversation.
Amanda-I was taught also to perform well. I took AP courses and took the exam. I started college as sophomore and I kept adding majors. I graduated with 3 majors. But, that means nothing in the real world. We’re taught that there’s a meritocracy and that you work hard and you’ll succeed and that’s just not true. For me, I didn’t know how to network. There’s this entire hidden network of jobs. The compounding affects of this crisis on your personal life: I’m 30 I don’t own a home, I’m not in a relationship and I don’t have children and that’s a problem.
Michelle-I’m older and I get it. As much as I would like to be married and have a little, cost is a huge deterrent and it doesn’t make sense. I wonder what would have happened during COVID if the Administration hadn’t paused the loans? I think there’s a lot of angst because people are struggling even though the loans are paused.
Amanda-That’s the elephant in the room.
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