To go to college or not go to college that is the question in the game of life and I’m going to show you the data so that you can make your own decision and at the very end I’ll give you my honest advice and so let’s talk about
Playing the game of one of zero every time I make a point for college I’m going to move my college graduate forward one point and every time I make a point for my non- college graduate I’ll move him forward in his career one point let’s see who wins in the end this
Chart shows you how much the cost of going to college has gone up compared to the starting salaries now you might be like wow okay there is a big difference here to put this tuition increase in context this has doubled in just the last few decades whereas the median
Starting salary has more or less stayed the same so you pay twice as much for the same thing let me show you what the result of this has been this is national student loan debt and you’re like oh it’s measured in dollarss that’s in trillions 1.76 trillion is more GDP than every
Country in the world besides maybe the top 10 so that means that our College days kids young adults are taking on more debt than entire nations produce and so at some point you have to think are they going to be able to make that up and if you’re a parent or loving
Relative that a young person who’s making this decision is sent to I want to talk to you specifically I went to Vanderbilt which is a very good school right now I think it’s ranked 13 that’s tied with brown as a pseudo ivu League school I graduated in three years magnet
Klow I was president of my fraternity I was vice president of the powerlifting team and I did it in three then I went into a white collar job management consulting for two years and then while I was at that job I studied very hard and got above Harvard Business school’s
GMAT midore and so that was my plan until I started thinking a little bit more for myself about wait does the math really make sense here fast forward a decade I now want a portfolio of companies that does over $200 million a year and I make these videos so that
Hopefully younger people or just people at different stages in their career can make better picks and so that’s my formal education side my informal education side is that I quit my white collar job started at minimum wage at a gym where I paid a guy to let me work
For him and follow him around all day then I got into the gym business scaled that to 5,000 locations in the US and there a company called gym launch and I sold that to private Equity Group for 46.2 million I now own a portfolio of companies that has over a
Thousand employees and so I know what businesses today are actually looking for and it’s not what I used to think and maybe what you used to think years ago which is no one even looks at where you went to school or what you majored
In or even what your GPA was all we care about is your experience and the likelihood that you can do the job well and many of the jobs that are available today there is no school for because the school degrees and the things that they taught have nothing to do with how much
The economy has changed and I know you care a lot about whoever you’re helping make this decision I I want you to know I care just as much and I don’t benefit from either of these decisions that they choose to make except for maybe if they do something that adds benefit to the
Workforce they might eventually work at one of my companies but that’s really it and so I make this as even-handedly as I can because I benefited from both sides and here’s one of the worst Parts about this debt number one is that the interest rates are high and number two
Is that you literally can’t bankrupt out of it meaning once you do this you’re stuck paying it for the rest of your life I think that’s one point for not going to college now what do you actually get when you pay for college this is the median lifetime earnings by
Education level meaning if you stop at this level of Education this is how much you can expect to make over the rest of your career and so if you don’t graduate high school you make less than a million dollars for the rest of your life that’s the median the middle person in the
Range now if you do finish with a high school diploma about 30% better 1.3 million if you have some college so you go and make maybe you drop out 1.5 a little better bachelor’s degree 2.2 million all right now we’re more than double our high school diploma master’s
Degree 2.6 doctoral 3.2 and then professional degree 3.6 million now that’s how much you make over the rest of your life I would say that that’s a strong point for education so let’s move our graduate up one point now we see this really high increase in income but
It’s not not free so remember this slide that I showed you earlier the debt that you take on for student loans you cannot bankrupt out of which means that until you die you have to pay it back and they force you to make that decision when you’re 18 years old and you’ve never
Made a dollar in your life nor can you comprehend the scope of what $250,000 of after tax income is and the interest rates that you’re paying when you make a $250,000 loan out you’re not paying back $250,000 you’re paying back $400 $500,000 in post tax money over the
Span of your career and so that leads naturally to like okay well how is that going to affect the rest of your life well look at how earnings actually increase over time and so this is important when you look at your actual life you’re going to be saddled with
Relatively large payments for a long period of time and so you can actually start catching up in your late 30s and early 40s where earnings begin to spike when are you starting a family when are you getting married when are you buying your first home if that’s what you want
To do all here and yet you’re still saddled with that debt that you cannot get out of and you have very high interest on to me that’s a very strong point for not going now the median incomes that I showed you earlier that’s over your lifetime but those don’t all
Happen at once and often times earning power and income happen later on in your career and the higher your degree the longer it takes to actually get there and so you can see some of these bottom rungs more or less stay flat that whole time whereas some of these other ones
That you have to pay for takes longer in order to earn back so by the time you’re late 30s early 40 you might be making more money but you also have the drag of the debt and the payments and the interest that you have to carry with you
In the tune of a few hundred, extra does this differential after tax after lifestyle and family and house does it make up the difference you might think wow then I should not go to college well the odds are against you in terms of earning income let’s dive in this line
Represents bachelor’s degree median lifetime earnings We compare this visually with each of the other levels of education so you have a 7.3% chance of making more than somebody with a bachelor’s degree if you don’t graduate high school the odds aren’t in your favor not to say that you watching this
Who’s investing in yourself trying to get educated you’re not that 7.3% cuz you very well might be but statistically you’ve got a 1 in 12 shot of just beating someone who went to college now if you do graduate you double your likelihood of beating that person you go
To one in six if you get some college one in four if you get an associates one in four is now let’s go to Masters you have a 6 out of 10 shot of making more money than somebody who just has a bachelor’s if you get a doctoral 7 out
Of 10 and then finally a Prof professional 83% or 8 out of 10 shot of actually making more money when you do have more skills you do make more money the question Still Remains is it worth it but in my mind this is a clear argument for more formal education one
Point College all the while you’re thinking through this decision you need to use Warren Buffett’s investment question which is the difference between what you pay and what you get so if someone says Hey I want to give you this Ferrari you might think well obviously I
Want to do that well for what price now if they say for $10,000 that’s a great deal if they say for a million do you might be like that’s a terrible deal and so it’s not about necessarily whether getting more education makes more money or not it’s just is it worth what it
Costs if I said hey I can get you to make $200,000 a year you might say of course I’m in but if I said in order to make that $200,000 a year you need to pay me $7,000 for the rest of your life okay okay well all of a sudden the
Amount I’m making is significantly less than that and so you can’t take how much you make without considering how much it costs I think an important point to make here is that these are percentages but it also shows that 27% of people who have a doctoral degree still don’t make
More than people with a bachelor’s degree all that to say these aren’t guarantees the way that they are purported to be and a lot of college money goes into advertising that this is the guaranteed way of moving moving forward in life but looking at these stats if you’re that one of those five
People or one of those three people that’s below you literally got none of the upside and all of the downside so why is there such a disparity between these earning levels well it also depends what industry you want to get into so for example if you want to get
Into personal services Blue Collar health support sales and office the higher education doesn’t make nearly as much of a difference on the flip side if you want to get into science technology you want to get into health professional so we’re talking doctors uh managerial and professional then it does make a
Bigger difference and so part of making this decision is well what do I want to do when I grow up so if you think that you want to go into a very formal career path you want to be an accountant you want to be a lawyer you want to be a
Doctor then it might make a lot more sense for you but if you want to be a salesperson you want to be a marketer do you want to do any blue collar job any kind of Home Services things like that then it probably doesn’t make sense for
You and so in my mind that’s one point for both sides so one of the questions I would be asking is okay well if one out of eight people who has a high school degree can beat somebody who has a college degree over their median earnings then I’d be like what makes
That one person special we actually pulled up a great research study that looked at that exact question which is how many of these people would have been successful who went to college already on their own without going to college one of the big skews of college is that
People who go to college in general have more money come from higher socioeconomic families Etc well if those people had just gone out on their own and gone into the professional world would they have just made the same amount of money the results might interest you if you are a white person
Or an Asian person you have no value ad from college if you control for SAT score socioeconomic status and other factors that would differentiate people on the flip side if you are Latino or you are black college does have a significant 30 to 40% increase in median
Earnings the results like life are a little bit nuanced it depends on who you are now I could make an argument or you might say hey Alex was going to win either way but what some of you guys don’t know is I went to Vanderbilt and I graduated magn kumlu that being said
Everything that I do in my life today I didn’t learn in college and so the question is what is it worth the money the other question is if IID started 4 years earlier would I be further than I am today so one of the most interesting statistics I’ve come across is that
There’s one metric above all others that predicts your earning income better than anything you want to know what it is it’s not your race it’s not your gender not your IQ think how crazy that is it’s not even your IQ it’s the zip code you
Were born in my theory on the reason of why that is and the differential between races is that when you go to college you can figuratively change your ZIP code because you change your environment and the people you know and more importantly the people you compare yourself to poor
People can feel rich if they compare themselves to other poor people but as soon as you get into a room where everyone makes 10 times more money than you all of a sudden you feel like the poor person and what do you do you change your behavior College may add
Value to people who didn’t already get that value given to them interesting which makes a strong argument for being the first person in your family to go to college because then it actually changes the trajectory of your Offspring and your Prodigy and your family tree if
You’re not the first person it makes a lot less of a difference and so the thing that gets a lot of people to win at college is the same thing that gets you to win at business and life and so the question is is the college really necessary if you have those
Characteristics already in order to get in like if you got a high enough SAT score to get into an IV League school like Harvard Stanford Yale then you probably are smarter enough to do the other things without going to Harvard Stanford and Neale and still make money
As a side note personally I got above Harvard’s GMAT score for business school I haven’t gone to Harvard Business School but I’ve done pretty good in business kind of interesting if I were to go to Harvard Business School and then make money afterwards was it Harvard or was it may and I actually
Faced this decision when I was thinking about going to Harvard and I thought to myself well do I want to not make money for 2 years and incur $250,000 of debt and when I did the dollar and cents for me going to business school I thought man why don’t I take the
$250,000 and just start a business and I’ll bet that by the end of those two years I’ll have learned more than I did in business school and I’ll graduate The Game of Life two years ahead and making more than the median income of somebody who went to business school and that
Ended up being true and so if you want to get into anything that doesn’t have a formal degree required in order to make that money then it doesn’t make sense and that’s one point for the career so one of the big things that Pro col Advocates talk about is the network that
You meet when you’re in college and how much that Alumni network can benefit you getting a job doing a deal or whatever it may be in the future and I will put two strong caveats on that claim number one is do I think that for $50,000 a
Year I could buy into whatever Network I want to be if people making significantly more money than me with skills that I’d like to learn for $50,000 every single year for four straight years to me that answer is mood or even more in favor of just going the
Career and if you want to buy a network then buy a network to me that’s an argument for not going to college if we’re trying to control for the same money now one of the other points that’s Pro college that is often made is what about the social experiences you have
The once in A- lifetime opportunity to be around all people only your age potentially meet the love of your life party have lots of fun get dressed up in toas learn how to beer bong and all of that stuff for $50,000 a year $1,000 a week you could party your absolute face
Off and make friends with all of these people in that same period of time now I would say though it is more difficult to meet that many people your age in a professional career than it is to do it at college and I would say that if
You’re looking purely from a fund basis I’m not going to say real world’s going to beat College now can you get close with $11,000 a week you go to Vegas it’ll show you a hell of a time but I would still argue that from a social perspective those
Four years would be more fun the question is what you’re optimizing for now if you want to say I just want to go to a resort for 4 years I totally understand but understand that that’s what you’re choosing to buy but if that is what you want then I would say that
The social aspect is a pro for college now one of the things worse discussing is can you get the upside for free now if you have FAA and you qualify for it mean you can get financial aid or you can get grants or you get a merit-based scholarship for sports or for
Scholarship that makes a real difference because now you’re getting all the upside without having the downside and if you live within these 24 States you can actually get a bachelor’s degree whereas the other 26 states in the union don’t actually offer that and if you can
Go to college for a bargain then that might be a great deal and that would be one point for college I do think that there are some full price colleges that even if you had to take loans it would make sense to go to if you get into Harvard or you get into
Princeton or you get into Stanford or Yale or one of the Ivy League schools a top 20 school in the United States that everyone recognizes the name I would say that for how much that will impact your personal brand that is worth it because one every single time you walk into a
Room people be like oh yeah he went to Harvard or he went to Yale and that will immediately shift their perception of you and the types of jobs and how quickly you can progress in your career the second factor is that the people who go from those colleges become the ruling
Class they rule the world they go to the highest paying jobs the people who graduate from those schools their median income I don’t know what it is but many of them are in the tens to 20s to 50s of millions of dollars per year and so in
Those instances if you can get in there then the Arbitrage of what you pay versus what you get is still a great deal now let’s look at the lifetime earnings with a little bit more Nuance because this is across all degrees in all schools but I think we can both
Agree that all degrees are not created equal if somebody says hey I have a PhD from State you versus I have a PhD from Harvard you could probably bet that that Harvard PhD is going to be going to top firms move faster and ultimately just make more money over the long term they
Can also network with other Harvard phds who get into those great places whereas that might not be as prevalent and so the 75th percentile at Harvard for a bachelor’s degree might might be not 3 million but it might be 6 or 10 or 15 million and so in that instance it does
Make sense and as much as you’re like man this is a more complex decision yeah many variables exist and many variables must be studied Welcome to the Real World because the ruling class are so scrutinized for having advantages there are such generous endowments for those IV League schools that most people who
Don’t come from the ruling class can get significant financial aid for going there making the trade even more worth it so if we look at the scoreboard between college and not College we’re dead even and so let me just give you my honest opinion right now so I’m looking
Down at my life four years in the future and I see college and I see career me which one do I choose so if I started going down the college path if I come from a wealthier family then I don’t get the benefits of college and I incur the
Debt so that might not make sense on the flip side if I am less fortunate or coming from a less fortunate family socioeconomically then I do get a better benefit from college and I will likely get some sort of financial aid increasing the difference between what I
Pay and what I get and I have a new network so my ZIP code improves that might make a lot of sense for me if I’m super well off then I already have the benefits of going to college and I might as well start my career with those
Benefits already not incur debt and make four years more income and four years further in my career path provided I don’t want to do science technology doctor lawyer accountant stuff if I’m lower socioeconomic status then I might not have the same benefit and I might find myself in the bottom part of that
Circle that represents the statistics not to say that you’re not the one of eight people who can earn more it’s just less likely so given those variables where do we go from here if I came from a a lower educated lower socioeconomic family and get financial aid
Significantly I would say 50% or more of that tuition I would say go to college you pay less for what you get and you get more than anyone else does on the flip side and this is counterintuitive if you already come from a highly educated family and you have higher
Socioeconomic status and you’re not going to get favorable financial terms for paying for school it makes less sense for you to go the counterintuitive thing here is that the rich families the better off families are the ones that encourage their kids to go to college the most I would even say they encourage
Them they expect it they demand it it’s assumed it’s the default choice this box is already checked for them at Birth if you get no benefit from college and it cost you money and four years of otherwise Career Development then you shouldn’t do it the big caveat off the
Top is if you want to go into one of those careers that requires a degree it requires a degree it it is what it is but I will say this if you don’t have a plan for what you want to do with your life don’t expect that $200,000 in four
Years is somehow going to give you a plan you just need to confront the fact that right when you graduate you’re still going to be looking at life with all the directions coming from your feet and being like well what should I do now because I can promise you even if you
Fell in love with a class there’s no career path that’s the class and so it doesn’t even mean anything to get good to that and so once you get into the real world you’re like well I loved biology well unless you’re going to be a scientist or you’re going to be a
Physician you’re probably going to go into HR it makes way more sense to actually learn what the Departments of a business are and what those roles entail on a day-to-day basis and think well these are the types of things I like if I like talking to people I could be a
Recruiter for a company if I like talking to people I could be in sales at somebody who employs almost a thousand people now between our portfolio companies we don’t care at all what someone’s degree is you know what we do care about experience so if I had a 4-year college
Graduate who comes out with a Philosophy degree and I’ve got somebody who’s been in sales for four years and didn’t have a degree and they’re the same age who do you think I’m picking for the sales job the guy who’s been in sales for four years if I were deciding between going
To college and not going to college this is what I’d be thinking about now if you’re not going to college and you’ve made that decision let’s talk about how to actually maximize that path number one is that you are still prioritizing education you’re just not prioritizing formal education so you should
Absolutely take money take time and spend the majority of your day trying to learn if you play video games all day and you just watch Netflix and you smoke weed in your parents basement you’re going to be the seven out of eight who lose but if you are the type of person
Who can work all day and work on themselves and get experience in the real world then you can learn at your job all day get paid to learn take that money spend it on learning more in the evenings and 4 years from now you will be so much better equipped than anybody
Who has graduated four years in a formal degree who just knows how to shotgun a beer really fast I will tell you how I’ve learned everything outside of school I pay people who already have the skill by the hour to learn now if I can’t afford them I will see if I can
Buy a course or a book or watch their videos or whatever it is but if they don’t have any of that stuff and you’re just saying man I really want to learn how to do storage units from this guy well then you can ask to pay for 1 hour
A week to learn what to do and I can promise you entrepreneur and people who have skills are always happy to help people who take initiative there’s nothing that fills someone’s heart more speaking from personal experience of somebody who asks you for advice and then executes on it and as long as you
Do that you will have more help than you know what to do with start one or two steps ahead of where you’re at pay to learn the skills and then take one or two steps whether you’re taking this path or you’re taking this path you have
To choose to invest in your ability to learn so that you can earn in the future more than you are everything that you make in the first four years of your career is not what you’re trying to get rich on it’s what you’re trying to get
Smart on and the fact that you get paid for it is just bonus so don’t get your ego caught up in the fact that you’re making $30,000 a year or $40,000 a year or minimum wage I started at minimum wage after having a white collar job for two years and getting above Harvard’s
Mid score and so you have to take a slice of Humble Pie to realize that I might have been really good as a Management Consultant but I didn’t know [ __ ] about running a gym and so not coming in pretending like you know something that you don’t and being
Willing to accept the fact that someone who might be less educated or less polished than you still knows more now if you get into the IV League school then by all means like I said go but if you don’t get into one of those schools and you’re just into the the middle of
The pack that costs too much and doesn’t give you anything extra then I think that you need to pull up to the table put the napkin in your collar and take a slice of Humble Pie and realize that you don’t know everything and you have to be
Willing to suck and you also have to be willing to be doubted by your family because they probably won’t agree with this decision because they’re going to think well this worked for me my life is great and I want the same for you but remember they’re doing this out of love
For you because they want you to win but you just have to explain to them I want me to win too and I think times have changed when they came out hierarchy and tenure mattered a ton and pedigree whereas today because everyone has equal access to information for free on the
Internet and you can learn more on YouTube than you can from most colleges you don’t need what once was required so big picture you don’t need to stress you’re going to win either way if you’re a winner this will probably just get you there faster with less debt on the flip
Side if you are born in a bad zip code you have a family that the majority of them has not gone to school or any kind of formal education and you don’t saddle your family or yourself with debt in order to go to school it almost always
Makes sense to go to school because all you’re doing is you’re getting a different network of people you will then change the trajectory of your progeny your family tree that comes after you and all you do is you start 4 years later and again you have all the
Earning potential benefits of going and getting a bachelor’s degree but without all the costs and you got a real value ad from college whereas somebody who started with an advantage doesn’t and so in that sense it absolutely does make sense to do that I’m going to as many
Credits as I can and I’m doing that so I can meet as many people as humanly possible all right so that’s where you sign for the Social Clubs sign up for the sororities and fraternities go to all the things that you can your Lux surface area will increase with the
Amount of people that you expose yourself to and will also introduce you to a lot of diversity of opinion and if you’re going to college cuz we want to change your environment and change what you compare yourself to then the best thing to do is get exposed to a lot of
Different things and if you find yourself in a position where you have a hard time not partying as much not to say that you can’t party have fun but if you’re slacking at school you’re paying to go to school it is your job to learn and you need to treat it like that
You’re paying not even getting paid you’re paying $1,000 a week to get educated and you’re going to have to make up that ,000 later on with interest and so you better [ __ ] learn something while you’re there and so the idea of the fifth year senior and taking
12 credits a semester the bare minimum required to be a full-time student what a joke take 18 take 21 credits and do it in four years you can gra graduate with a double degree I just graduated in three I cut a year off right if you can
Go to summer school you can also save money and you can still get the same benefits and so you can graduate in 2 years or 3 years if you absolutely hustle your ass off because you are a professional student act like one the tldr is in either of these paths you are
Choosing to learn not earn the money goes in different directions but that is the objective and in both of these career paths objective number one is being a professional and you’re either being a professional student or you’re being being a professional student that just happens to get paid for it but in
Either situation learning comes above everything else the side benefits are that you’ll meet a few more people and your party a little harder the side benefits here that you’re not going to go in debt and you’re going to get paid to do it I want you to know that I am
More impartial than probably anyone else in your life and I say that because I don’t know I don’t know you and I don’t know anyone else in your life now they will get status based on their friend group who are older might not understand stuff like this video and so they want
You to do that because one it probably comes from a good place but two because they’re afraid of their downside of what if you become a failure but by the way you can become a failure if you go to college too so the one thing that you
Can do to guarantee this is that you have to decide for yourself number one and number two is that either of these paths is education and you have to understand that you’re not getting into the workforce to go make money you’re getting into the workforce to learn better more relevant skills and just
Happen to get paid for it as long as you keep that clear and that you’re going to stay disciplined about it because you’re not going to be more necessarily disciplined when there’s tons of naked girls and parties around you and some I’m sold on College by that alone I get
It but I promise there’s plenty of time for both send this to anyone who is debating this decision right now thank you for playing the game of one of zero I hope you win
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