Whitman Ochiai still remembers the first time he really understood the concept of saving money. It started with a story about a pumpkin seed that his parents told him when he was 4 years old.
“They said, ‘you can eat a seed, yes. But if you put that seed in the ground and invest in it, you can get a pumpkin. Then, there’s much more of it, you can eat a lot more of it, but you have to be patient,’” Ochiai said. “And framing it that way, that really stuck in my head and made me get the value of saving.”
Today at 18 years old, the value of that story shines through in Ochiai’s day-to-day life. Not only has Ochiai been saving money specifically to attend college since he could walk, but since 2018, he’s been passing on similar money lessons to fellow teenagers via his free podcast, “Money Ed.” Ochiai said "Money Ed" has given him a genuine passion for increasing the reach of financial literacy, specifically to teens and young adults.
In each three- to five-minute podcast episode, Ochiai speaks on topics like stock terminology, types of federal student loans, and the power of giving meaningful financial gifts.
These days Ochiai hosts "Money Ed" from his dorm room at Cornell University in Ithaca, New York, and wants teens to get a head start on financial planning so that they realize, “college is sooner than you think, and it’s not too early to start preparing.”
The Balance spoke with Ochiai about the importance of delayed gratification, having a plan, and setting financial goals—especially those that involve paying for higher education.
This interview has been edited for length and clarity.
Early Building Blocks
You learned about the basic concepts of money from a young age. Can you tell us a bit more about how that played out?
I was lucky enough to grow up with family and mentors who were willing to answer my questions about how the world worked around me. I remember back when I first saw my mom use her credit card, and I asked her, “Hey Mom, why didn't you have to pay?” At the time, I legitimately thought that—because my mother worked for the federal government, she's in public health—the government gave her infinite money. So she explained to me how a credit card works and how, no, it's not free money.
I will also say that a lot of it came from the random questions I would ask. So I don't think there's ever any point where they necessarily sat me down and told me about how money works, necessarily.
How do you think those family-focused learning experiences shaped you?
I think what really stuck with me is how they taught me about delayed gratification. That isn't necessarily a specific lesson ... but it's very broadly applicable, which is why I like it and why it's really stuck with me. I think a lot of financial literacy comes from being able to think, “If I don't do this thing now, what might I be able to do later?” So I think understanding how to delay your own gratification, and in the broader sense, opportunity cost is just one of those financial lessons my parents taught me that has really stuck.
Finding the Funds
You’re officially a college freshman. What did the financial planning process look like for you and your family to get you ready for school?
Well, when it comes to cost, my parents have always emphasized to me that there is no price—rather no monetary price—that one can put on the worth of a strong education. They emphasized to me that it would be better for me to go to a stronger school where I would have to take out loans, than think purely in terms of not taking out loans. So ultimately, I took out federal loans and private loans.
Additionally, I have a 529 [plan] that my parents started when I think I was about 10 with $50. But to that end, I worked a lot of jobs before going to college. I did a lot of tutoring, and I put all my job money into my 529. I also applied for scholarships during my college search to help supplement the loans and the 529 funds. So ultimately, I'm financing my education with a combination of federal loans, private loans, scholarship money, and money from my  account.
When you start a 529 plan for your child, you can contribute as much as you want, or up to the amount that is necessary to fund their education. While contributions aren’t deductible, earnings will grow federal tax-free and will not be taxed when the money is taken out for qualified education expenses. Which educational expenses are covered will depend on the type of 529 plan you open for your child: college savings plans or prepaid tuition plans.
I would like to graduate college with less than $10,000 in student debt. Now, I'm not saying it's an easy goal because it's not. I'm also going to be working jobs at college, and I'm also still going to be going for scholarships during my time here.
What were you most surprised by when figuring out how you were going to pay for your college education?
What really got me I think was how much you pay for not college. I feel like a lot of the costs that college incurs should be rolled into the actual tuition costs, and I was surprised when they were not. Like $1,000 or so for books. You're going to have to buy books anyway. Cornell also requires all freshmen to have an unlimited meal plan. Why not just put that into your freshman tuition if you have to have it?
I'm not saying that it's necessarily a malicious thing, but it just feels a little bit deceptive that they'd be like, “Oh, this is your tuition,” plus, I don't know, another 50% of that initial cost is tacked on because of extra fees that, "Oh, I guess we just forgot to tell you."
Helping Others Think Ahead
From your point of view, what are some key points about paying for college that young people tend to miss or not fully understand?
I think the most important thing when it comes to paying for college is to start the process early. I told you how my 529 account was opened when I was 10 by my parents, and how I planned out scholarship applications. I think that element of planning and preparation is the most important thing to understand when it comes to paying for your college because if you do your research and understand how much you're going to have to pay, you'll be able to prepare yourself for it. Not just financially, but also mentally.
If you don't and you wait until the last minute, you're going to be scrambling to apply for FAFSA, maybe find scholarship money, or maybe [work another] job to try and cover some of those extra costs.
As a teenager who learned about the value of money through your parents, do you have any ideas for how parents can help teach their teens about money lessons?
I think just being upfront, explaining, “I care about you, and because I care about you, I want to make sure that you understand these concepts as you get older and you enter the real world.” Mentioning things like, “When I pay my taxes, this is what happens,” or, “Since you want to go to college, you need to understand what student loans are and you need to know how you want to pay them off.” Or “I have a credit card. This is why I use it. This is what I use it for and these are the responsibilities that I have because I use it.”
What advice would you give a teen who isn’t sure where to start when it comes to money management or working toward a larger goal, like paying for college?
Another important financial literacy concept I think that is critical [for teens] to understand is how to set financial goals. You want to make ... the acronym I believe is SMART, S-M-A-R-T. Specific, measurable, attainable, reasonable, and time-limited.
So for example, with my $10,000 goal, I think it's specific and it's measurable. I can know if I hit it or not. It's not easy, but it's still within the realm of reason. And finally, there is a time limit, because it's “by the time I graduate.”
I think that if you have a good picture of where you're headed, it's a lot easier to prepare and plan your way to get to that point.