Americans collectively hold almost $1.5 trillion in student debt, making them more burdened by student loan debt than ever. The average borrower from the Class of 2016 owed more than $37,172.
That’s part of the reason self-made millionaire and Reddit co-founder Alexis Ohanian is questioning the traditional education path.
When the New York Times asked the tech entrepreneur about his best advice for college grads, Ohanian responded with a rhetorical question: “Do you really need to go to college?”
“There is a huge student loan debt problem in this country,” he continued. “I think there’s going to need to be a drastic change in how these universities work. And I also think we’ve lambasted the trades for way too long. You can make six figures as a welder.”
Ohanian, who sold Reddit to Condé Nast in his early 20s and came back to the company in 2014 as executive chairman, isn’t the only self-made millionaire proposing alternatives to traditional higher ed. “Most people should not be going to college,” Grant Cardone tells CNBC Make It. “We have more college debt in America than we have credit card debt combined. It is a crazy program.”
And self-made millionaire James Altucher tells Farnoosh Torabi that, in many cases, “a degree means nothing.”
“We’re in an idea-based economy and a skill-based economy, not a certificate based economy,” the entrepreneur continues. “We used to be in a certificate-based economy. It’s just not true anymore.”
More and more companies are saying you don’t need a degree to work for them, Altucher notes: “Ernst & Young, the top accounting firm in the country, said they’re not even going to ask you anymore if you have a college degree. And Google no longer asks if you have a college degree.”
On average, college grads do earn about $1 million more over their lifetimes than those without a degree and the future looks especially bright for recent graduates. That said, a college education is now the second-biggest expense an individual is likely to make in their lifetime, right after buying a home.
While Altucher himself went to a Ivy League school, Cornell University, he tells Torabi that his computer science degree “was a waste. … I put in my 10,000 hours of programming, went to graduate school [at Carnegie Mellon] for computer science and put in probably another 10,000 hours.”
Rather than getting degrees, young people should focus on getting skills, he says, which you can learn online, by going to the library and reading books or simply once you enter the workforce. “I have employees: They’re experts on writing, finance, sales, the latest internet marketing, all of these things that are not taught in college at all because a lot of the skills were actually created yesterday and they have to keep up with them on a daily basis,” he says. “What they’re good at is learning what was created yesterday, and you build that on the job.”
While Altucher says to focus on picking up skills, Cardone suggests a different hack. He advises young people to establish relationships with “the power players,” he tells CNBC Make It. “The old adage is: It’s not what you know. It’s who you know. That’s still true today.”