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The Ramsey Show

Why Even Ivy League Degrees Aren’t Worth Borrowing For (Hour 2)

31 Jul 2023

Transcription

Transcript generated automatically by AI and may contain errors.

Chapter 1: Should my son take out loans for an Ivy League school?

27.588 - 55.936 Dave Ramsey

Live from the headquarters of Ramsey Solutions, broadcasting from the pods, moving and storage studios. It's the Ramsey Show. We help people build wealth, do work. that they love, and create actual and amazing relationships. Ken Coleman, Ramsey Personality, host of the Ken Coleman Show, number one best-selling author of the book Paycheck to Purpose, Career and Jobs, work expert, is my co-host.

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56.036 - 62.805 Dave Ramsey

Open phones at 888-825-5225. Mary's in Chicago. Hi, Mary. Welcome to the Ramsey Show.

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Chapter 2: How can I navigate AI roadblocks in job applications?

63.746 - 65.108

Thanks for taking my call.

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65.308 - 66.049 Dave Ramsey

Sure. What's up?

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67.058 - 91.184

I have a son who was accepted to an Ivy League law school. And I know 10 things that you say you should never do is take out student loans to go to school. And we paid for all of his undergrad, everything we'd saved through a 529-24 plan.

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94.547 - 95.428 Dave Ramsey

Good. Way to go.

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95.982 - 111.789

Yeah, he's taking out quite a large sum of money, about $170,000 for three years. He did get $90,000 worth of scholarships, but I just am really nervous about that.

Chapter 3: Is it wise to surrender motorcycles to avoid payments?

111.949 - 127.773

I mean, that's a lot of money. And coming out of where he's going, he's in a T14 school, so... His income in three years when he's finished will be $200,000 to $250,000.

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129.956 - 131.618 Dave Ramsey

Maybe. You hope.

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133.68 - 139.447

Well, that's what big law is paying in New York and Chicago, and that's where he would end up.

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140.488 - 141.229 Ken Coleman

Based on what?

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143.652 - 144.773

He's a top student.

145.274 - 149.479 Dave Ramsey

100% of the law students that graduate from that university do not go into big law.

151.113 - 157.418

Well, the reason he chose the one he's going to is because it's international, and that's what he wants to do.

Chapter 4: What are the financial implications of an Ivy League education?

157.438 - 175.154 Dave Ramsey

I know, but 100% of the international lawyers that specialize in international that graduate from that law school do not make a $250,000 salary. Some do, but not all of them do. So anyway, this is already decided. How can we help? Because we can't fix it. I mean, he's going to go do it.

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176.315 - 184.678

Well, I just wanted to kind of find out what you thought. And also we have, it doesn't matter.

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184.698 - 185.679 Dave Ramsey

He's doing it anyway.

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Chapter 5: How do Ivy League degrees affect job prospects?

186.22 - 208.272

It does because we have a coach house over our garage. And I did offer to him that when he got done, he could live in the coach house, but he would have, he would have three years and he would have to pay that back in three years. He would have to take all other than his minimal living expenses and pay down that debt.

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208.42 - 217.409

Is that something you think we should offer him or be like, nope, you took it out? Because we never had student loans. I paid for all my school myself.

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218.951 - 224.616 Dave Ramsey

Mary, if you want to offer it, you can. I don't think the guy that signed up for the trip you're talking about is going to take your offer.

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227.94 - 229.301 Dave Ramsey

I think you would do that.

Chapter 6: What sacrifices are necessary for paying off student loans?

230.002 - 233.105 Dave Ramsey

You would live in the coach house, but I don't think this guy will.

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235.347 - 238.41

Do you think it was a mistake to do that, what he's done?

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238.711 - 264.28 Dave Ramsey

yeah absolutely but i don't think it matters all we can do is love him i'll love him and you can love him and and hope it works out for him but um it's it's mythology that you make more money because of where you went to school across the board now obviously there are exceptions to that and coming out of harvard law does set you up to be a better chance than coming out of

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264.26 - 281.545 Dave Ramsey

University of Tennessee Law School, okay, to go to a big firm in Chicago or a big firm in New York. But also, you've got to understand, when you sign up for a big firm in Chicago, a big firm in New York, you're a number, and their goal in the first three years there is to try to kill you.

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282.346 - 283.307

Right, right.

283.327 - 291.118 Dave Ramsey

You work 300 hours a week. I mean, it's just bizarre. It's crazy, yeah. And all just to get to be in big law.

Chapter 7: What strategies can help in job searching after layoffs?

291.239 - 310.686 Dave Ramsey

I mean, it's and then at the end of the story, what have you really got when it's all clear? Oh, I'm a partner in this mess. Yeah. OK. And so it's it's it's if that is your goal, singular goal, you know, you might make if he if it all works out and he does get that gig, then we might get there.

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310.919 - 330.086 Ken Coleman

Might, but I want you to hear this, Mary, and I want Dave to comment on this because diving into this, there's a new study out by a group of Harvard-based economists, Opportunity Insights, and they looked at students who were waitlisted by Ivy League schools, Dave, compared with the estimated future earnings of those who eventually got in with those who didn't.

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330.847 - 351.91 Ken Coleman

And they attended one of nine flagship public universities instead. So you mentioned University of Tennessee. Here's what they found. It's a statistically insignificant impact on their future earnings as they projected income at age 33, and they said that the Ivy League degree would average a 3% increase over a state school.

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Chapter 8: How can I improve my chances of getting hired in a competitive job market?

352.03 - 352.992 Ken Coleman

Now, that's not law.

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353.663 - 382.489 Dave Ramsey

It's not law, but they're talking about... In general, an Ivy League degree. 100% I can tell you that in business, it doesn't make spit difference. 78% of the Fortune 500 CEOs graduate from state school. They didn't go to MIT, they didn't go to Wharton, and they didn't go to Harvard, and they didn't go to Yale. They didn't go to Vanderbilt. The idea that you make more in business is laughable.

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382.705 - 390.717 Dave Ramsey

Now, in law, there is a nuance that you probably can get in there. She's talking about big law. She's correct about that. And this is the pitch.

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391.037 - 395.764 Ken Coleman

But the problem is that he still has to get in. Just because he had the degree from Harvard doesn't get him in.

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395.784 - 396.765 Dave Ramsey

He's got to graduate.

397.406 - 399.149 Ken Coleman

He's got to graduate in the top of his class.

399.169 - 410.485 Dave Ramsey

You know how competitive it is? He's got to graduate. He's in. He's in. He's got the degree. He's got the entrance. And he's written the check. It's a done deal. So, Mary, just coach him and tell him, hey, we love you.

410.465 - 434.65 Dave Ramsey

and we're going to be here for you even if we don't agree with your decisions and we hope it works out for you the way you think it's going to but i but i'm worried for you and i'll be praying for you honey yeah because i will i'm not mad at him and i'm not mad at you folk out there but the problem is when people believe mythology that two percent of the people you know if you do something that only works two percent of the time that's not a principle that works

434.63 - 457.582 Dave Ramsey

That's correct. And, you know, so what percentage of Harvard law or Vanderbilt law or for that matter, and you pay, you pay what, 4X for the degree or 5X for the degree of what you would have paid in a state law school. And then get into big law and what percentage of them by the time they're 33 are still there. Right.

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