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Every time I do a post and mention credit cards, I hear the same comments over and over again “You can get paid to use them” or “I never carry a balance” or “We pay it off every month.”
I will never forget one comment that was made by someone. She said that people do not use credit cards because they are not disciplined shoppers. She tried to tell me that only disciplined shoppers can really use credit. I completely disagree with this comment in every context.
Having not used a credit card for years, I find that it requires much more discipline to live a life without credit cards. If I have $100, I can’t overspend and I really think twice before making the purchase. No way to overspend that way!
In the years since we’ve gotten out of debt, we did not use a credit card – until about 6 months ago. I actually got one just to better understand readers who say they use only their credit card (for the record, I did not like it). We used it for that period of time and then just paid it off. It is now in our safe.
I think back to when we had the credit card though and the days when we weredeeply in debt. For some reason, I did not really look at the credit card charges in the right way. For me, it was the instant gratification or a way to put food on the table when money was tight. I totally missed the lesson on the fact that credit card balances are debt. Even if charged for 2 weeks….it is debt.
Did you read that? If you owe any money to anyone, it is debt. Even credit card balances are debt. It does not matter if you pay it off each month.Yes, it is revolving debt, but it is debt nonetheless.
“I don’t want debt.”
CREDIT CARD BALANCES ARE DEBT
Credit card balances are debt. Yes, we can pay it off every month. But it is debt. I don’t want debt. We have worked too hard to get to the point in our life where we have one remaining debt: our mortgage. It is something we don’t want any more of. Ever. Not even a short term debt that we will pay off in 3 weeks. It just doesn’t work for us.
The thing is, when you are trying to get out of debt, you really have to change the way you look at credit cards. Like I said, it is debt. There are perks, however, is it worth debt just to earn them?For us, it wasn’t.
I know many people who use credit because they hate to spend cash. Try to change your way of thinking. I challenge you to use cash for everything. One you do, you will begin to look at cash in a different light.It is empowering to pay for something with cash. I won’t forget the large TV we bought with cash — not debit – but cold. hard. cash. In that moment, I felt strong and empowered. It were as if I were doing something no one else could.
OUR LIFESTYLE CHOICE
My husband and I have made a lifestyle choice. We don’t need credit cards. It is a financial decision we have made and that we own 100%. This has nothing to do with our ability to pay it off every month. It is simply because we don’t need one. Our emergency fund and savings are there when we need them. We don’t need debt in order to live.
Discipline comes from within and for any one to judge another person to say why they live the way they do financially is wrong. I don’t judge the mom at the grocery store paying with credit. First of all, how do that she isn’t using her debit card? Even if it is credit card, how do I know if her husband didn’t lose his job or they have a sick child and have no savings left? I don’t know their financial situation. That means it is wrong for me to judge.
The same goes for someone who doesn’t have a credit card. It is often that they choose not to own one and has nothing to do with spending habits or credit-worthiness. Just like so many other topics, it is a lifestyle choice and one that should not be judged by others.
Ramsey's best argument against using rewards cards is that these cards end up perpetuating a system that preys on people who are struggling financially, need credit to get by, and get stuck paying the exorbitant interest rates that credit cards charge.
It's completely acceptable to avoid getting a credit card. Consumers can pay entirely with cash, check or debit card and still build a positive credit history through other types of loans.
Paying for daily expenses with cash can either make budgeting a snap or a swamp -- it all depends on how you manage your supply. You don't have to literally use envelopes, but if you separate cash for different purposes, then you'll be able to avoid over-spending on one category.
Having no credit card debt isn't bad for your credit scores, but you do need to maintain open and active credit accounts to have the best scores. By using your credit cards and paying the balances off monthly (so that you carry no debt), you could achieve an excellent credit score.
Because they pave the way for high-interest debt accumulation, investing mogul and billionaire Warren Buffett is generally against credit cards and advocates for spending in cash as much as possible. It's a great idea, isn't it? Just bid adieu to credit cards and start fresh with a more cash-centric approach.
But when credit is no longer a part of your life, you're free to live on your terms—not the credit card company's. You have more opportunity to spend your money, time and energy on what matters most to you. And you can make way more progress toward your goals when you don't have debt holding you back!
Many millionaires keep a lot of their money in cash or highly liquid cash equivalents. They establish an emergency account before ever starting to invest. Millionaires bank differently than the rest of us. Any bank accounts they have are handled by a private banker who probably also manages their wealth.
An exclusively cash lifestyle may help you follow your budget, sidestep overspending, and avoid the high cost of overdraft, interest, and other fees that can be incurred when you pay by check, debit, and/or credit card.
A good goal is to be debt-free by retirement age, either 65 or earlier if you want. If you have other goals, such as taking a sabbatical or starting a business, you should make sure that your debt isn't going to hold you back.
Yes, credit card companies do like it when you pay in full each month. In fact, they consider it a sign of creditworthiness and active use of your credit card. Carrying a balance month-to-month increases your debt through interest charges and can hurt your credit score if your balance is over 30% of your credit limit.
What percentage of America is debt-free? According to that same Experian study, less than 25% of American households are debt-free. This figure may be small for a variety of reasons, particularly because of the high number of home mortgages and auto loans many Americans have.
His major advice with credit cards is to cut them up. Cut them in half, shred them, dispose of them and never ever use them. I think Dave Ramsey doesn't like credit cards under any circ*mstances. Of course you still have to pay them off.
Instead of being so focused on a score, his approach to credit scores and financial health emphasizes the importance of living within one's means, rather than relying on credit. He advocates for a life free of debt, suggesting that people should focus on paying off their existing debts and avoiding new debt.
One of Dave Ramsey's most controversial opinions is his stance on credit usage. He advises against using credit and argues that credit scores are not a true measure of financial health. Instead, he describes them as how well you “play kissy-face with the bank.” According to Ramsey, credit scores simply do not matter.
Finance expert Dave Ramsey has provided lots of financial advice to people about getting their money lives in order. But when it comes to one of the most important money metrics -- your credit score -- Ramsey isn't interested in helping you improve yours.
Introduction: My name is Frankie Dare, I am a funny, beautiful, proud, fair, pleasant, cheerful, enthusiastic person who loves writing and wants to share my knowledge and understanding with you.
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