NPR Story
11:16 am
Thu May 3, 2012

'Be Richer' By Learning From Parents' Mistakes

Originally published on Fri May 4, 2012 8:29 am

College seniors graduating in 2012 face a sluggish economy, bleak job prospects and a mountain of student loan debt. To make matters worse, many don't have the first clue about how to manage their personal finances.

Author Zac Bissonnette, a recent college graduate himself, learned how to handle money by watching his parents' mistakes and ignoring most of their advice. He put himself through college without loans, scholarships or help from his parents.

In his book How to Be Richer, Smarter, and Better-Looking Than Your Parents, he offers advice to his fellow 20-somethings.

"The reason that this money stuff is so important for young people now," he tells NPR's Neal Conan, "is that we're operating with no margin for error, that ... 10 years ago young people had. ... You don't have the room to make mistakes."

Bissonnette gives his advice for avoiding common financial mistakes and staying out of debt.


Interview Highlights

On lessons from his parents

"My parents were middle-class people who had financial struggles like most middle-class people do. ... My dad was going through his own financial crisis ... really in 2004. We always joked that he was kind of ahead of his time in that regard.

"And what I saw was this, adding this incredible amount of stress that really prevented him from having, you know, in a lot of ways the quality of life that he deserved. ... I wanted to do a book that parents could give to their kids and say, 'Here's how you can avoid falling into the traps that we fell into and have a better life than we had,' because I think that's what every parent wants for their kids."

On what young people get wrong about money

"People who drive luxury cars are not happier than people who drive junky cars. People who are on the Forbes list are not happier than people who aren't on the Forbes list. People who have expensive watches are not happier than people who have inexpensive watches.

"That sort of happiness boost from buying a brand new car lasts about two weeks, and then you're back to being miserable about all the other things in your life.

"On the other hand, things like having a few thousand dollars in a savings account reduces stress enormously."

On the correlation between spending and television

"There was a study that found that the more television you watch, the more likely you are to think that a high percentage of Americans have in-ground pools and tennis courts in their homes. ...

"And what it suggests is that ... humans are social animals ... and so our spending and our attitudes about our finances are absolutely impacted by what sociologists call a reference group, which is the group of people against whom we compare our own financial decisions."

On the benefits of buying a used car

"There's this sort of stereotype that buying an older, used car, it's not safe. And 10 or 15 years ago, this advice was really, really true. But what the data shows is that the reliability rates on 10-year-old and 15-year-old and even 20-year-old cars now are so much better than they were a few years ago because ... there's been this improvement in technology that for the first time you really can, for a few thousand dollars, buy a reliable car that's going to be safe and get you where you need to go.

"It doesn't have to be your dream car for the rest of your life ... but someone told me ... 200,000 miles is the new 100,000 miles. And if you can get the car thing right, you know, it's such a good start to getting the rest of it."

Copyright 2013 NPR. To see more, visit http://www.npr.org/.

Transcript

NEAL CONAN, HOST:

This is TALK OF THE NATION. I'm Neal Conan in Washington. Zac Bissonnette's father, he writes, taught him about money the way an alcoholic teaches his kids: by being a bad example. A history of parental arguments, later divorce and default convinced him there has to be a better way. He put himself through college with no loans, no scholarships or help from his parents. And despite all the challenges that young adults face these days, he argues that you can all make smarter decisions about spending it and keeping it, decisions that can add up to a better life now and in the future.

If you're a young adult, we want to hear about the decisions you've made about your money, 800-989-8255. Email us, talk@npr.org. You can also join the conversation on our website. That's at npr.org. Click on TALK OF THE NATION.

Later in the program, what's behind our fascination with tall buildings? But first, the financial life of twentysomethings. Zac Bissonnette joins us from our bureau in New York. His new book is called "How to Be Richer, Smarter, and Better-Looking Than Your Parents." And nice to have you with us today.

ZAC BISSONNETTE: Great to be here, thanks.

CONAN: As mentioned, you learned lessons about financial responsibility at home.

BISSONNETTE: Yeah, no, absolutely. You know, when I was growing up - and I don't want to oversell the kind of sob story. My parents were middle-class people who had financial struggles like most middle-class people do. You know, my parents were - you know, my dad was going through his own financial crisis, you know, really in 2004. We always joked that he was kind of ahead of his time in that regard.

And what I saw was this - adding this incredible amount of stress that really prevented him from having, you know, in a lot of ways the quality of life that he deserved. He's a wonderful guy. He's a brilliant guy. And so I wanted to do a book that parents could give to their kids and say here's how you can avoid falling into the traps that we fell into and have a better life than we had because I think that's what every parent wants for their kids.

CONAN: Yeah, but wait a minute, you also say that if you, the kids, can work out a better way to reach your financial stability, one thing you don't have to do is listen to advice from your parents anymore.

BISSONNETTE: Absolutely, and that's the best thing. You know, you can just kind of nod dismissively when your parents give you advice, and that is what I want to do, and I think that's what everyone wants to do.

CONAN: And your argument boils down to - and you say all right, look, there's no 12-step program, there's no golden formula, but your formula boils down to don't spend it.

(SOUNDBITE OF LAUGHTER)

BISSONNETTE: Yeah, so, you know, one of the things I wanted to do with this book was really research what decisions people make with money that lead to a better quality of life and more happiness and what decisions don't. And what I found out when I started to research this is that the things that we intuitively believe money will do for us, we're often really, really, really wrong about those things.

So for instance, people who drive luxury cars are not happier than people who drive junky cars. People who are on the Forbes list are not happier than people who aren't on the Forbes list. People who have expensive watches are not happier than people who have inexpensive watches.

You know, in the high, that sort of happiness boost from buying a brand new car lasts about two weeks, and then you're back to being miserable about all the other things in your life. And so that's sort of the thing that I wanted to write about was, you know, what are the decisions that people are making that people think will make them happy that they're wrong about.

On the other hand, things like having a few thousand dollars in a savings account reduces stress enormously. It's a much bigger boost than having a new car.

CONAN: They are snowball effects on both sides.

BISSONNETTE: Absolutely.

CONAN: That in other words once you start making these poor decisions, well, you know, that big mortgage for that house you thought would make you happy, well, that causes you stress throughout, and indeed it can echo even to the point where you're less efficient at work, and...

BISSONNETTE: Absolutely, no, I mean, there was a survey, you know, that I think more than half of employees, you know, I might be getting the number slightly wrong, but admit that financial stress impacts their performance at work, and that impacts emotions, that impacts your financial life.

So there's this vicious cycle with getting in trouble with money, and I think the issue with a lot of young people, and I'm seeing the student loan problem, is, you know, people giving up hope because when you have - you know, I was just on a show the other day, and someone called in with $150,000 in student loans from a degree in early childhood development. And when you have that kind of hole, it's easy to fall into the sort of carpe-diem mentality where I'm in such a big hole that no decision I make really matters because it's never going to get better.

CONAN: Yeah. In fact, you describe the lives of two young adults who basically make about the same money in their salaries but have very different outcomes in how they look at life. One of them burdened by student debt had to take a job he despises; the other, debt-free, took a job that really she thinks is her dream job.

BISSONNETTE: No, and that's - I mean, there's this tragic irony of this, where, you know, this girl I was talking to the other day had $150,000 in student loans from a degree in early childhood development. And what that guarantees basically is that you will never be able to work in early childhood development, right. You can't finance $150,000 in debt. You know, the amortization is not going to work out that way.

And so what I've think a lot of people do, you know, is giving up enormous amounts of freedom in their lives and decisions they can make, sort of sacrificing those things at the altar of things that don't matter.

CONAN: Yet student loans, that makes it possible for a lot of people to go to school and get degrees that they are going to take advantage of, and again, if you look at the statistics, people with college degrees ultimately do a lot better than those without.

BISSONNETTE: Right, I mean, and even those statistics, you know, it's kind of a separate issue. Those statistics are problematic because we don't have a sort of comparison group of people who didn't go to college but were also highly skilled. So there's a ton of selection bias in that data. But, I mean, there's absolutely truth to what you're saying on that.

CONAN: So if people are going to go to college, and they're going to have some debt, they can also make another series of smart decisions, including don't watch TV.

(SOUNDBITE OF LAUGHTER)

BISSONNETTE: So this is one of the most interesting studies that I found when I was researching this book was that the more television you watch, the more likely you are to have a lot of debt. And there's a lot of sort of theories about this. The one that I find the most interesting is that - so there was a study that found that more television you watch, the more likely you are to think that a high percentage of Americans have in-ground pools and tennis courts in their homes, which - and this is fascinating to me.

And what it suggests is that, you know, humans are social animals, right, and so our spending and our attitudes about our finances are absolutely impacted by what sociologists call a reference group, which is the group of people against whom we compare our own financial decisions.

And so if you watch a lot of television, and, you know, there's no show called "Lifestyles of the Poor and Unknown." This is all, you know, it's upper-middle-class and up, generally, unless you're watching, you know, "Hoarders," I guess, that's depicted on television. And that does seem to, according to the data, you know, filter into people making poor decisions with money.

CONAN: Well, you - I know you say you don't have a TV, but you seem to know a lot about the housewives of Beverly Hills.

BISSONNETTE: Yeah, you know, I bought the DVDs on Amazon, and I actually did take them as a business expense, and I'm hoping I get out of audited, but...

(SOUNDBITE OF LAUGHTER)

CONAN: The IRS is listening.

BISSONNETTE: IRS online, too.

CONAN: So, but in fact you say one of the great examples in your book is Teresa Guidice.

BISSONNETTE: Yeah, Teresa Guidice, and this is a really sad story, and I think there was this tragic-comic element to it, but to me - you know, and even though I've made fun of her too, some, it's really sad. You know, this was a girl who was on "The Real Housewives of New Jersey" with her husband, who was billed as this really, really successful real estate developer. They had the dream home, kids, you know, lavish parties, and she was flipping tables at people and yelling at people for not bringing high-end cookies to her parties. And, you know, basically they didn't really have any money.

CONAN: I've had those cookies. They're really good.

(SOUNDBITE OF LAUGHTER)

BISSONNETTE: The pignoli cookies. You know, and they ended up in bankruptcy, and, you know, there was an interview with her in In Touch Weekly, which is another magazine I read and take as a business expense where she talked about how, you know, now that she's lost all that money, you know, that she didn't really miss a lot of the things that, you know, maybe she thought she would miss, that what she was focused on now, in kind of rebuilding, was making sure that her daughters had a college fund because she never wanted her kids to be dependent on a man.

And so I think, you know, in the kind of fall, she learned this important thing, and, you know, and I think it's - you know, it's a sad story, but I think that there's a lot for people to learn from it.

CONAN: We're talking with Zac Bissonnette. His new book is "How to Be Richer, Smarter, and Better-Looking Than Your Parents." We want to hear from younger adults in our audience about the decisions you're making with your money. Give us a call, 800-989-8255. Email us, talk@npr.org. Patrick's(ph) on the line calling from Cedar Falls in Iowa.

PATRICK: Hello, how's it going?

CONAN: Good, thanks.

PATRICK: Hey, yeah, I love this topic. I talk to all my friends about it, actually, all the time. I graduated a year and a half ago with an engineering degree, lucky enough to get a job right out of school, got on a debt payment, paid off those loans. And what I decided to do was continue my quote-unquote "loan payment" to myself until I had approximately six months of expense put away in a separate savings account for my emergency fund. That way, you know, a job loss or anything like that, if I get hurt or anything, I'm totally covered from financial ruin.

CONAN: So you didn't go out after paying off your college debt - and congratulations on that - and reward yourself with, I don't know, a trip or a car?

PATRICK: No, no. I kept - well, I mean, do the basics. I mean, make a budget, live within your means. I put every extra dollar away. It only took me, you know, a few months after getting those loans paid off. You'd be surprised how much money you have when you're out of debt.

CONAN: Zac Bissonnette, this is a guy calling who is not going to buy your book.

BISSONNETTE: He should not buy my book. I would tell him not to buy my book. You know, this guy's on top of it.

CONAN: That part about the car, you write a lot about that.

BISSONNETTE: No, the car thing, I mean, you know, the average car payment is I think over $400 a month now, and, you know, there are really few things in life that can torpedo your sort of entire financial plan the way that having the wrong attitude about buying a car can. You know, Suze Orman wrote in one of her books that, you know, the idea that we spend money we don't have to impress people we don't know who pull up next to us at red lights. And it's kind of insane.

And, you know, my buddy, Jeff Yeager, who did an excellent book called "The Cheapskate Next Door," you know, he had a great line. He said, you know, if you had a Ferrari, and no one could see you driving it, would you still want it? And, you know, it's really interesting.

But one of the things that I love just sort of on the practical side is that there's this sort of stereotype that buying an older, used car, it's not safe, you'd really better buy a new car or a slightly used car. And 10 or 15 years ago, this advice was really, really true. But what the data shows is that the reliability rates on 10-year-old and 15-year-old and even 20-year-old cars now are so much better than they were a few years ago because, you know, there's been this improvement in technology that for the first time you really can, for a few thousand dollars, buy a reliable car that's going to be safe and get you where you need to go.

It doesn't have to be your dream car for the rest of your life, you know, but someone told me, one of these experts told me that, you know, 200,000 miles is the new 100,000 miles. And if you can get the car thing right, you know, it's such a good start to getting the rest of it.

CONAN: Patrick, are you thinking about a car?

PATRICK: Oh absolutely. I enjoy cars. I still have my first car since I was back in high school. You know, it's nice not having that car payment. What I've actually decided to do is once I got my emergency fund all buttoned up is once again continue that payment to myself until I can sit down, walk into a dealership, throw cash on the table and say here's the car I want.

BISSONNETTE: You know, my grandfather did that once at an Infinity dealership in Florida and tried to pay cash, and they said: What are you, a drug dealer? Only mafia pays cash for cars. But no, it's totally the way to go. I mean, I'll be curious, you know, that if you save $20,000 for a car, will you still want to spend that money on a car.

I mean, I think - one of my concerns is that when people are borrowing the money, it's so much easier to make these big decisions. But if you have $20,000 in cash, I don't - you know, you seem like a frugal, smart guy. I'll be curious whether you actually are inclined to spend it on a new car. And I mean, if you are, great.

PATRICK: I actually was recently, with my old car kind of starting to break down. I was realistic with, well, why spend that extra, you know, like you were just saying with the reliability of slightly older cars. You know, I don't see the need to go above and beyond, you know, $8,000, $9,000, $10,000 when I can keep putting that away for a big down payment on a house someday, which is my next big goal.

BISSONNETTE: You are a smart guy.

CONAN: I can foresee your new model car, Patrick, and it's called a Schwinn. Thanks very much for the call. We're talking with Zac Bissonnette, author of "How to Be Richer, Smarter, and Better-Looking Than Your Parents." Stay with us, TALK OF THE NATION from NPR News.

(SOUNDBITE OF MUSIC)

CONAN: This is TALK OF THE NATION from NPR News. I'm Neal Conan. After a lot of research on exactly how best to handle your money in your 20s, Zac Bissonnette came up with an answer: Don't spend it on anything, ever. It's of course not quite that simple, or he wouldn't have a new book out, but he lays out many of the lessons he picked up in "How to Be Richer, Smarter, and Better-Looking Than Your Parents."

Among the advice: how to best invest in stocks, why you should ignore everything you hear from talking heads on TV and radio. That's at an excerpt on our website. Go to npr.org. Click on TALK OF THE NATION.

If you're a young adult, we want to hear about the decisions you've made about your money, 800-989-8255. Email talk@npr.org. You can also join the conversation on our website. That's at npr.org. Click on TALK OF THE NATION.

If you're a young adult, we want to hear about the decisions you've made about your money, 800-989-8255. And Zac Bissonnette, who's with us from our bureau in New York, I suspect all the callers we're going to get mostly - maybe we'll get some calls about people in college debt who they don't quite see it as being their fault - but I don't think we're going to get a lot of people who say they're - they spent way too much money on a mortgage, a nice car and a trip to Europe.

BISSONNETTE: No absolutely. I mean, for this generation, the student loan (unintelligible), the topic of my first book, is the number one issue for young people, I mean absolutely. It's this sort of new anchor around people's necks that, you know, a generation ago, didn't exist.

I mean, you know, you had - people had student loans, but it was so much lower. I mean, the horror stories are a new thing, and they're only getting worse.

CONAN: And so given that start out - and it's not the greatest job market on the planet, either, in the planet's history - this is - there are special challenges today.

BISSONNETTE: No, I mean, there absolutely are. There are special challenges. And, you know, one of the things, I was just talking to a friend who was, you know, looking at jobs, who just graduated, and, you know, he's concerned, you know, are employers going to judge my resume because, you know, I got a job working at, you know, like a home improvement store, you know, right out of college with a bachelor's degree.

And the answer - you know, because I've talked to quite a few human resources people about this - is that no, most employers understand that, you know, during the past three years and the next few years, recent graduates are going to be doing whatever they can to put food on the table, and employers are not looking at it as a bad thing.

CONAN: Well, that aside, there are some people who do have some money, and yet they want to find the best way to maximize it. You write the world of banking, mutual funds, credit cards and insurance is a world of greed, manipulation and lies. They're looking to rip people off. So how do you then go about to leverage what little money you may have?

BISSONNETTE: So I mean, this is one of those things where, you know, you can avoid most of the kind of problems people get into by just keeping it really, really, really simple. So for, you know, investments on the IRA side, what I tell people is go through either Fidelity or Vanguard. I use Vanguard. Do a target-date retirement fund that consists exclusively of index funds. It keeps the expenses really low. You're going to do better than 80 percent of professional investors, and you don't have to think about it, and you don't have to worry about your emotions getting involved and, you know, encouraging you to make bad decisions.

CONAN: So that would be your advice to - this is from Mike(ph) in Illinois: With interest rates so low, what's a good vehicle to start savings, especially since getting a job with a retirement plan is harder?

Yeah, I mean, you know, the best thing, I mean, for retirement, you know, clearly is the Roth IRA for recent grads who have incomes that qualify. And you can put away $5,000 a year. And I would do it through Vanguard. That's what I would do. And I have no deal with them or anything, don't worry.

Let's see if we can go next to Kyle(ph), Kyle with us from Huntington in Indiana.

KYLE: Hi there.

CONAN: Hi.

KYLE: I would say that the - we have made some pretty traditional financial decisions, my wife and I, but I would say that the ultimate thing that we did was actually a piece of information I learned and heeded from my parents to never carry a balance on a credit card. And I never have. I got my first credit card when I was 16 years old, and I've never carried a balance on it.

BISSONNETTE: That's good.

CONAN: That is fundamental advice, because once you max out those credit cards, well, you can run into an awful lot of problems.

BISSONNETTE: No, I mean, and the thing that's interesting with credit cards, is that even if you don't run a balance, you're actually going to end up spending more. I mean, what the research shows is that you spend the most money when you use a credit card that has a rewards program attached to it. You spend somewhat less money when you use a credit card that doesn't have a rewards program attached to it.

You spend a little bit less money than that, when you use a debit card. The least money of all is when you pay for stuff with cash because there's a sort of primal hatred of giving up cash. So, you know, what the research shows is that if you pay with a credit card, on average you're going to spend something like 10 or 15 percent more money than if you paid with a debit card or cash.

And that's important for people to know that, you know, obviously you don't want to run up a balance but that even if you aren't running up a balance, paying for stuff with credit cards all the time, you know, will kind of subconsciously lead to you spending more money.

CONAN: Kyle, do you have to make any sacrifices? Have you said wait a minute, no, I'm not going to buy that?

KYLE: Well, it's like he was saying earlier. I just try to keep things simple. So yeah, maybe here and there there's things that we can't make impulse buys on, but for the most part, I guess I just never have known any different.

CONAN: So if you've if you've never known any different, these are habits, and that's an important point. These are habits you can get into, Zac Bissonnette, that will, over time, well, make life simpler, easier and a lot more prosperous.

BISSONNETTE: Absolutely, and, you know, I think there is a significant chunk of the population, and our first two callers have been in it, I'm in it, of people who are just sort of inclined to not go into debt and do smart things with money. But for a lot of people, you know, trying to sort of focus on habits and self-discipline and willpower and that kind of thing, it won't work because people can't muster up willpower for extended periods of time.

And that's really, in the past 10 years, the technology on this has made this really easy to do. That's where the automation comes in, you know, because if you're setting it up so you have money automatically taken from your paycheck and put into your 401(k), then some other money automatically taken and put into an IRA, some other money automatically taken and put into an emergency fund, and, you know, then you can do sub-savings accounts for it if you want, you know, a fund for a home and that kind of thing.

And then you have money automatically taken to pay your students. And then you don't use credit cards, and you can live on the rest, no matter what. You essentially have a budget-free balanced budget and requires no willpower because it's all done automatically, and the first priorities in your life, the money goes to that first.

CONAN: Kyle, thanks very much for the call.

KYLE: Thanks, love the show.

CONAN: Thank you, didn't mean to cut you off when you were saying how much you love the show. Let's go to Brad(ph), Brad with us from Flint, Michigan.

BRAD: Hey, how are you?

CONAN: Good, thanks.

BRAD: Yeah, I make $30,000 a year, and I save $100 a week from my paycheck that I put into an emergency fund, and recently I've been taking $25 off the top of that to put into my Roth account.

BISSONNETTE: That's fantastic.

CONAN: And how do you make $30,000 a year?

BRAD: I work at a golf course up here in Flint.

CONAN: Doing what?

BRAD: I'm their golf service manager.

CONAN: Does that mean you work in the shop?

BRAD: I actually run the outside golf operations.

CONAN: Oh, I see, OK. So - and is that a job with a future?

BRAD: Within the industry, yes.

CONAN: So it's not - I'm trying to hear what you're saying, within - a limited future, then?

BRAD: Yes, yes.

CONAN: All right, but it sounds like - are you happy with your life?

BRAD: Very much so, yeah. I ran into some snags along the road, and having that emergency fund really saved me.

CONAN: And that's - that kind of peace of mind, Zac Bissonnette - thanks very much, Brad, and good luck...

BRAD: Thank you.

CONAN: That sort of peace of mind is - that's worth a lot of money.

BISSONNETTE: It's worth a ton of money. I mean, the money can buy happiness when you have an emergency fund, right?

CONAN: And there is another important word that you learned, I think, from Joseph Heller, the word enough.

BISSONNETTE: Yeah, there was this great story that I just love, and I tell people this all the time. And it was Kurt Vonnegut and Joseph Heller were at a party for this hedge fund manager. And I love this so much, I put it in the book. And the guy had a ton of money, and he was just kind of a jerk, and Kurt Vonnegut said to Joseph Heller, you know, does it bother you that that banker, who you've never - you know, who most people have ever heard of, made more money last year than you made in the entire run of "Catch-22," which is one of the bestselling books of all time?

And Joseph Heller said, you know, no it doesn't bother me because I have something that he'll never have, and that's I have enough, and I know what that means, and he doesn't.

CONAN: Another word that you think is important to define is wealth.

BISSONNETTE: Yeah, wealth, I mean, you know, it's a tough thing because I think, you know, in the media there's this portrayal of it. And, you know, and granted Thomas Stanley with his book "The Millionaire Next Door," did a lot to kind of dispel this myth. But the truth is that, you know, the average rich person in America didn't inherit the money. They worked really hard for it, and they're basically frugal.

And what's really interesting to me, is that if you look at the research on millionaires, you know, in Thomas Stanley's work and that kind of thing, in general it's very, very unmaterialistic people, which is sort of at odds with what I think what most people think the average millionaire would be. That these, you know, are typically people who have values that are kind of in line with their lives and aren't sort of interested in consumption and that kind of thing.

They're interested in their work. They love their work, and they accumulate money.

CONAN: Let's go next to Shannon(ph), Shannon with us from St. Augustine.

SHANNON: Hi, I am recently 20 and recently married and having a baby. And while all these things are great, I laugh at what you're talking about because now, I mean, I would never spend a penny that was out of line. I have a savings account for my daughter, for my retirement, for school. I mean, I'm covered at every end.

But before I found out that I was having my daughter, and I got married, I used my father's credit cards for everything. I mean $500 on a dress. It didn't - it didn't matter to me. And a lot of the friends that I maintain, who are not married or have children, I have a hard time explaining to them what a great deal it means to have money saved.

I see people going to Europe and people moving to New York City with no plan, with no savings, and they come crawling back to Florida.

And so I just wanted to make a quick comment that, you know, there is a bigger picture. I mean, I didn't see myself at 20 being married with a baby. But now that I am, you know, I wish that that money - I mean, I've been working since I was 14 years old. I mean, I can think of the hundreds and hundreds of dollars that I would spend on clothes, but now it's in my closet, and I'm much too embarrassed to wear because I'm a mother.

(SOUNDBITE OF LAUGHTER)

SHANNON: So, you know, it's interesting. I think that women - particularly, you mentioned earlier Teresa from the "New Jersey Housewives" - I mean, women, it's like, you know, you have to be empowered. You have to be able to have these savings. Otherwise - I mean, you can't rely on your fathers and husbands and things like that to support you. It's just - it's not right.

We live in a different day and age, where, you know, you can, as a woman, certainly go off to graduate school and do what you want to do, your craziest, wildest dreams, but you have to save and plan to get there. Otherwise, it's just not going to happen for you.

BISSONNETTE: Can I ask you? When you hang out with your kind of single friends who are still spending a lot of money, I mean, is that difficult for you now that you're so on top of stuff?

SHANNON: It is. And just, you know, between my husband and I, I come home with these stories, and I just cringe watching my friends order, you know, $50 worth of sushi or buying a new David Yurman ring when I know they can't afford it. And it is very difficult for me, and I'm definitely in between lives right now. I wear many different masks.

But I really do think that if many of your listeners today can really, just really believe in what you're saying and just, you know, put away that $25 a month, it just makes such a huge difference. And if anything, I mean, I hope that everybody, you know, wants to maybe not have children, but wants to live a happy life with somebody else, you know, you have to have savings to do this. It doesn't - you cannot live from day to day and then worry about the rest until later because, I mean, what, when you pass away, if you do, your debt goes onto your family, which isn't fair. So I hope that, you know, especially your women...

BISSONNETTE: It doesn't go. Just - it doesn't go onto your family. I mean, it dies with you. But...

CONAN: It - student debt, if you co-signed a loan, will come back. But...

BISSONNETTE: If it's cosigned.

CONAN: Yeah. I wanted to put, Shannon, this email we got from Nancy in Fruitland, Washington, to you: You'll have lots of extra money if you only have as many kids as you can actually afford and don't jump into parenthood before you can afford it.

Is that something you've considered?

SHANNON: Yes. And I think that before my husband and I found out that we were having our first child together, I wanted five children, and he laughed at me. And now that we have one, the one is probably good. And I think that, like, in terms of finance, how we're talking right now, I mean, I think that one, financially, is fine. And I do - that's a great point that your caller - or that your listener pointed out, is I think that a lot of people don't consider the cost of children, but, really, I mean, don't consider the cost of themselves.

I mean, now that I have a child, I have to worry about dental and insurance. And these are also things that my single friends have no idea about. I mean, their cellphone bills are paid for by their parents. So it's very interesting, and I can just only advocate for women everywhere to just plan, plan, plan, plan, plan.

CONAN: Shannon, thanks very much for the call. Appreciate it.

SHANNON: Thank you. Bye-bye.

CONAN: We're talking with Zac Bissonnette about his new book, "How to be Richer, Smarter, and Better-Looking Than Your Parents." You're listening to TALK OF THE NATION, from NPR News.

And that caller raised a lot of interesting points, Zac Bissonnette. But I wonder, given what you've described as the job market, the student debt and other problems that this generation of 20-somethings is going on, there's going to be a long tail of depressed earnings that are going to follow people through their lives. Do they have to lower expectations?

BISSONNETTE: You know, I think - and this is, you know, you will sell no book by saying this, but whatever. You know, I think people do. I think that, you know, we have a lot of people grew up - you know, I think - you know, America has something like - and I'm going to get the statistic wrong - something like 6 percent of the world's kids, consumes 40 percent of the world's toys.

You know, we grew up in this economic bubble that was largely fueled by credit, and, you know, job growth has been - you know, wages have been stagnant, and that kind of thing. So I - I mean, I do think that people have to kind of consider the fact that you might not, for a long time, have the kind of lifestyle that your parents had.

The good news on that is that none of that makes people happier. And if you can adjust to it, you know, you'll be fine. But I think, you know, the big thing is that - you know, and the reason that this money stuff is so important for young people now is that we're operating with no margin for error, that, you know, 10 years ago young people had. They're just - you don't have the room to make mistakes, especially, you know, when you're coming out with these student loans. You know, you just - you have to get this stuff right, and you have to get it right early.

CONAN: Let's see - get Max on the line. Max is with us from Baton Rouge.

MAX: Hello. Well, one of the ways that I save money is - I mean, I work at an art gallery and only get paid, like, $8 an hour, and I work part-time. But every paycheck I get, I spend about $100 buying precious metals. And, like, I went for this huge space where - you know, like, anytime I got a paycheck, I would just immediately spend it on, like, bubble bath, just like random stuff. But I still have the satisfaction of buying, like, a physical object.

CONAN: Mm-hmm. I'm going to shock you, Alex(ph), by telling you that in his book, Zac Bissonnette says don't ever, ever, ever, ever, ever buy gold.

BISSONNETTE: Yeah. It's just that it's not - you know, and I'm sorry. You know, it's great. Look, if you want to put a, you know, a small percentage of your assets in it because you like it...

CONAN: It probably beats bubble bath futures. I'll grant you that.

BISSONNETTE: It actually - you know, it has - it beats bubble baths, and that's about it. You know, the long-term track record of gold is very poor, and, historically, the worst times to buy it have been periods like now, where there's been a run-up(ph). And I'm not, you know, I'm not a guy who goes and does, you know, market predictions and that kind of thing, but over the long run - especially, I mean, even just from a tax perspective, you're going to be so much better putting the money in a Roth IRA. You know, it's one thing if it's stuff you like and it's money you can afford and you already have a retirement plan going and that kind of thing. I'm fine with it.

But, you know, buying, you know, precious metals is absolutely not a substitute for buying mutual funds. And I'm concerned, you know, that on some other talk radio shows not on this network that, you know, there is a lot of drive toward putting people - people putting a larger percentage of their assets into precious metals, and I'm very, very concerned about it. I wouldn't do it.

CONAN: I'm going on to start selling pandas immediately.

(SOUNDBITE OF LAUGHTER)

CONAN: Alex, thanks very much for the call. Good luck. Thank you so much. We're - thanks to Zac Bissonnette. Appreciate your time today.

BISSONNETTE: Thanks so much.

CONAN: Zac Bissonnette's new book: "How to Be Richer, Smarter and Better-Looking Than Your Parents." And he joined us from our bureau in New York. Up next: The new tallest building in New York, One World Trade Center. We'll talk with its chief architect about the allure of skyscrapers. Was there one building, one moment that riveted your imagination? Give us a call: 800-989-8255. Stay with us. It's the TALK OF THE NATION, from NPR News. Transcript provided by NPR, Copyright NPR.

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