Zac Bissonnette is an Associate Producer at CNBC. He is also a writer and author of the book Debt-Free U: How I Paid for an Outstanding College Education Without Loans, Scholarships, or Mooching off My Parents.
There are a lot of books about college on the market, but Zac’s is unique.
For starters, Zac wrote the book while he was still a student at the University of Massachusetts-Amherst.
Secondly — as you’ll soon see — Zac’s take on college educations and how to pay for them differs greatly from the conventional wisdom that prevails today.
Zac’s book resonated with me because it includes so many of the conclusions that our family came to while going through the college search process for the first time.
In fact, I am such a fan of Zac’s book, that’s it’s one of only two books I’ve put in the Recommended Reading section of my Resources page here at The Family CEO.
Here is my two sentence review of Zac’s book:
Before reading this book I thought that the key to a debt-free education — assuming you didn’t already have a ton saved — was applying for multiple scholarships. Zac’s way is better.
Zac was gracious enough to agree to a Q&A at The Family CEO. Here is our conversation:
Julie: What is your background? Where did you go to college? What did you study?
Zac: I went to the University of Massachusetts-Amherst, and graduated with a degree in Art History.
Julie: Student loans are seen by many as “good debt.” Why did you decide to avoid them while getting your education?
Zac: Well when you look at all the data on this, you realize a few things: 1.) Student loans are not nearly as low-risk as most people think. Look at the default rates on them. 2.) People who graduate with a lot of debt are significantly less likely to pursue the careers they’re passionate about (or pursue grad school, or be stay at home parents). Student loans chain people to life plans that are often not good for their overally happiness, and that’s really sad.
Julie: How important is going to the right school (i.e. a highly regarded school)?
Zac: It’s nowhere near as important as the conventional wisdom says it is. All the research, which I cite at length in the book, suggests that your student’s success in his career will be determined by who he or she is, work ethic, social skills, etc., not the name of the school on a diploma.
Julie: What about students who are pursing high earning careers (medicine, engineering, law)? Are student loans more advisable for them?
Zac: Theoretically, yes. But the problem is that most people’s career goals change, and predicting what you’ll be doing in ten years is not as easy as the people who say “Never borrow more than your expected starting salary” seem to think. Less debt always gives you more options.
Julie: I was surprised by some recent statistics that showed that students at the Ivy leagues schools and others like them don’t accumulate a lot of debt. That’s completely counter-intuitive. What’s up with that?
Zac: Those top schools have huge endowments and very generous financial aid so as a practical matter–as I’ve said many times before–students smart enough to get into truly elite schools will likely not have to borrow money. Where people get into trouble with debt is at that second- and third-tier below Harvard, Yale, Stanford, etc. The problems are with New York University, Fordham Notheastern, etc.–those are the schools that families should be terrified of.
Julie: Many people (myself included) have been under the impression that working your way through college isn’t practical for today’s students, because tuitions have risen so dramatically. Yet you worked your way through without loans, scholarships, or help from your parents. Do you consider that do-able for anyone?
Zac: Especially with starting at a community college, it is doable. It’s not easy, but it’s definitely worth it and the resume that you’ll have and the narrative you’ll have when you do job interviews will be insanely valuable. The top stereotypes about young people in the workplace today are that we’re entitled, lazy, and expect instant gratification. What better way to counter that than to say “I worked 40 hours a week during college so I could graduate debt-free because I knew that long-term, it would be worth it?”
Julie: The title of your book references not “mooching” off your parents. What’s wrong with parents helping their kids go to college?
Zac: It’s funny. The original title that I had included the phrase “or looting my parents’ retirement,” but we ended up shortening it to mooching.
When I say mooching, what I mean is this: Too many parents are making financial sacrifices for their kids’ educational costs that put them at great risk. According to FinAid.org, 13.5 percent of parents are using PLUS loans to pay for college, borrowing an average of $23,298 — and then there are many more parents who are taking out home equity loans or withdrawing money from retirement accounts or depleting their emergency funds.
Middle-aged parents of college students are — and there’s no nice way of saying this — simply too old to be accumulating consumer debt. I don’t think parents should ever use PLUS loans and frankly, it’s a product that I wish didn’t exist.
So what I want parents to do is help their kids with college expenses by making short-term sacrifices — i.e. driving a car an extra year, selling stuff on eBay, or perhaps eating out less, as trite as that has become. I don’t want them looting retirement funds or taking out loans that will put them in grave danger if they lose jobs or see their assets decline in value.
Julie: Are there any circumstances under which you would recommend taking out debt to go to college? What about graduate degrees?
Zac: For graduate degrees, especially law school and medical school, it’s sometimes unavoidable. But I worry that too many people are going to grad school without giving enough thought to whether it’s really the best way to pursue what they want to do. This is especially true of MBAs. Anyone thinking about getting an MBA absolutely must read Josh Kaufman’s book The Personal MBA first.
Julie: What overall message would you like to leave with students and their parents who are in the process of navigating the college selection process?
Zac: Relax, and don’t think that this college thing needs to be the greatest experience of your life. It’s not terribly important in the grand scheme of things. What is important is not turning it into a debt-fueled orgy that cripples your future.
Julie: I want to thank Zac for taking the time to talk to answer these questions. I reached out to him because I believe his message is an important one, especially in this time of rapidly escalating college costs and exploding student loan debt.
How do your experiences attending or paying for college line compare with Zac’s?