Student loan debt may seem like it’s a way of life these days. But it doesn’t have to be, and Anthony ONeal can tell you how. Since 2003, ONeal has helped thousands of students make the right decisions with their money as the author of Graduate Survival Guide: 5 Mistakes You Can’t Afford to Make in College and his new book, Debt-Free Degree: The Step-by-Step Guide to Getting Your Kid Through College Without Student Loans.
After being in debt and experiencing homelessness—he lost both his college scholarship and his apartment—he overcame his financial issues to become debt-free. He now travels the country spreading his encouraging message to help teens and young adults transition into the real world. ONeal took the time to discuss why financial education is key to being debt-free.
What factored in your decision to enter the world of finance? And how has that impacted your life?
The lack of wisdom and knowledge I received growing up around finances directly impacted the decisions I made in my early adulthood. I had $35,000 in debt and was homeless at age 19. When I hit that low point, I made the decision to not only ever be in that situation again. But I knew I wanted to help young people avoid the mistakes I made.
Finance is a VERY important part of our lives, yet, it’s not really taught in schools, why do you think that is so and what should/could be done to ensure that children can make better financial decisions as they enter into adulthood?
There are only 11 states in the U.S. that require a personal finance course in high school. There are other states trying to make it happen. But up to this point, educators have not seen it as a priority for teens. At Ramsey Solutions, we’re working hard to change that. Our curriculum, Foundations in Personal Finance, has impacted millions of lives and has been taught in one out of three high schools in the country. And I travel the country speaking to high school and college students helping them understand the impact their financial decisions can have on their futures. It’s so important for teens to learn these principles young so they’re set up for success when they leave home.
Why did you feel the need to write, Graduate Survival Guide: 5 Mistakes You Can’t Afford to Make in College and what should we anticipate from your latest offering, Debt-Free Degree?
In Graduate Survival Guide I was able to really lay out the mistakes I made in college and work with my friend Rachel Cruze, who was lucky enough to avoid those mistakes. We were able to use both of our experiences to not only educate readers on what to avoid but also how to win while in college.
Right now, in America, we’re in the middle of a student loan crisis. While everyone is talking about student loan forgiveness, I want to help people avoid the student loan trap altogether. My hope for Debt-Free Degree is to change people’s perspective on how to pay for college – it is possible to go to school without student loans. You just need a plan, and Debt-Free Degree is that plan.
It seems as if MANY people are entrenched in student loans and not just that, it’s a debt that takes many years to eliminate. Why are we, as a country, so rooted in a student debt crisis?
Student loans are normal. It’s easier to sign for a student loan than it is to work hard, save money and find scholarships and grants. People are uneducated on the effects these loans are going to have on the rest of their lives. We’re seeing it all play out now. Millennials are postponing buying homes, getting married and even having kids because of student loans. That’s why the first thing I’m telling people to do is take debt off the table. When student loans aren’t an option, you find other ways to pay – whether that’s choosing a cheaper college, a trade school or spending time finding money.
Do you think with proper financial education, we can have a better economy for all? And if so, what steps do you feel need to be taken in order for it to happen?
When people aren’t relying on debt, they’re able to take control over their money. My mentor, Dave Ramsey, says that your income is your number one wealth-building tool. When you’re sending out a portion of your income to debt payments, you’re losing your ability to build wealth, save money, start businesses. You’re losing the ability to live life and spend money the way you want to.
At Ramsey Solutions, we lead people through the 7 Baby Steps to help them get rid of debt and save money. We’ve helped millions of people get rid of debt in 18-24 months and completely turn around their financial situations. It’s incredible the transformation that happens to these families when they have hope again when it comes to their finances.
What advice would you give to anyone who doesn’t make much money but still have their future ahead of them to avoid financial issues?
First, don’t let debt be an option. When you’re relying on debt to get by, you’re putting a Band-Aid on a bullet wound. It’s tempting to rack up debt when you’re stressed about your money, but debt is only going to add to that stress when the bills come.
Assess your situation and make sure that your expenses aren’t greater than your income. If they are, then you need to look for ways to increase your income and decrease your expenses. Like ASAP. That might look like picking up a side job and driving for uber or maybe selling your car and downgrading for something you can pay for in cash. Do what you need to do to get your money right.
Then I want you to make a budget. If you’re not telling your money where to go, you’ll wonder where it went. I do a monthly, zero-based budget. That just means that my income minus expenses equals zero, so I am telling every single dollar where to go every time I get paid.
You’ve appeared on television and social media giving sound advice to those who need it. How would you approach those who feel they may NOT need financial advice but could probably use some?
If you have debt, you need some financial advice. If you aren’t building wealth and investing money into your future, then you need it, too. The caliber of your future will be determined by the choices you make today. If you’re just having fun and spending all of your income now, you’re not setting yourself up for a good life later. Get on a budget, start making your money work for you and don’t let debt be an option!
Your book was just released. What plans do you have to promote the book and what other future plans do you have in the works that you would like to talk about?
I’m so pumped about my book Debt-Free Degree! Right now, I’m on my book tour and traveling around the country doing media to spread hope to people who feel like student loans are the only way to succeed. We’re just picking up speed and I’m not planning on slowing down anytime soon. Student loans are robbing young people of opportunities—not creating them. So right now I’m just focused on changing the way that our culture thinks about their future.
Why is it so important to you to help young people deal with finance successfully?
This message matters so much to me because I have been there. I was in a situation that felt hopeless because of the debt that I was in, and it kept me from starting my adult-life out on the right foot. I know kids and parents feel overwhelmed by the cost of college. I get why they feel tempted to take out student loans. It seems like the easy way upfront, but it is taking people an average of over 20 years to pay it off. That is not the easy way! Imagine what that monthly payment would do if you invested it for 20 years instead? The average student loan payment is $393 a month. That would be around $4.1 million by retirement. Student loans are literally costing young people millions of dollars!
If you can do one thing over again, what would it be and why?
I would listen to my mom. I would not have taken out student loans, and I would have cut up my first credit card when she told me to cut it up. Debt led me down a rough path where I was depressed, homeless and alone. I am thankful to God for helping me to come to my senses and turning my life back around. I know those experiences shaped me into who I am, and now because I’ve lived it I can help young people to avoid the same mistakes. But if I had just listened to my mom, life would have been a lot easier.