Why People Are Afraid To Let Go Of Credit Cards
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- čas přidán 14. 06. 2023
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What does Ken think the HVAC company is going to do if you talk to them and tell them you can't afford a new system? They'll tell you to go get a credit card to pay for it. I had a dental problem once that involved a lot of pain and I went to the dentist. I didn't have the money to pay for what he needed to do to fix it, so the receptionist tried to get me a Care card to pay for it. They don't care. They want to get paid (and I don't blame them) and you putting the transaction on a credit card solves their issue.
If it is a larger HVAC corporation, they will hand you a credit application to fill out, which will be an agreement with a credit card provider or a finance company. Either way, you're going to be paying 25%+ interest and with the HVAC financing, you're probably going to be hit with numerous application fees, etc.
True ! And if you do have a good size emergency fund 2 -3 things that go at once your emergency fund is gone. Anything major.
@Smackdown Outdoors True !
@@SmackdownOutdoors I have an emergency fund NOW. I didn't back then. The point is, if you need something, no one is going to help you out. They'll tell you to get a credit account.
Yeah, so if you're broke, you don't get to keep your teeth.
I was 15k in cc debt for 5 years . I finally made it out this year, the constant videos of this show helped me stay consistent
Imagine being $15K in credit card debt
I have 5 credit cards and they have high limits. I prefer an emergency fund of cash. However one day my account was locked up. It's scary when you have no access to funds at all.
What is considered a “high limit” these days ?
@@Tripp216 I consider $25K to be normal.
I love how he thinks that HVAC conpany isn't going to tell you to piss off when you tell them that you can't afford it. They deserve to get their money for work you are asking them to do.
Or tell you to sign up for a credit card to pay for it
Also think he's saying that they might allow you to pay it off in full, but in monthly installments with no interest. That's not uncommon.
@@nino-gs5yt around here you would never get that, you will be able to do installments, but you're going to pay about 7-10% minimum, and need about 20% down to start the work.
I literally laughed when he said that! 😂
I'm a private tutor. I've had woke college students whine to me that they can't afford my rates. The arrogance blows my mind. So you want to utilize my skill set and take up my time and think you shouldn't have to pay for that *why exactly*?
Because they're going to college to learn to save the world, basically, so I should want to donate to the cause that is THEM. Ridiculous.
Really? The HVAC guy will also charge interest. These guys don’t live in the real world. I guarantee these two would never go without an AC.
Bu… but human conversation!!
They want you to save up and pay cash for it. Not to go in debt to anyone.
@@mikemayo4812that's correct. They do want you to save cash and pay for it outright.
However, the way they worded it was along the lines of "tell the HVAC company you will give them the cash in full shortly, if they replace it now".
And if that's not what they are implying, then that was an invalid scenario to bring up because if you already had the cash you would just pay for it without conversation about "I'm gonna cash flow this."
@@Jmack1lla TRUE!!! !!!
Why would HVAC contractors float some stranger money when they can get 5% gauranteed righ now. When I replaced my system I charged it to a CC saving me $500 up front. They did offer a "0% interest" payment plan but the interest was just built into the total. I paid it off at the end of the month.
What if you've used a personal credit card responsibly since 1989.... and in 33.5 years you've never not paid off the balance in full, never had a late payment, never paid an annual fee, never paid a finance charge, never carried a balance, etc.?
The organization and discipline needed to being able to do that is uncommon. Most people can't or won't do that unfortunately (fortunately for credit card companies).
@@wjf5839 lol, anyone who has a credit score in the 800's is generally a prime example of someone who has done exactly what Todd has described over a long period of time. I don't think scores of 800 are "uncommon", just probably not the norm.
@@edd06001 I don't even think credit card companies need responsible savers to be "uncommon" to still earn a profit. When they get paid 20% interest from the people that carry a balance, not to mention merchant fees, they can afford to lose money on another customer.
@@edd06001 Americans have $986 Billion in credit card debt alone. Only 20 % of Americans have a credit score of 800 or above and they tend to be Baby Boomers. Of that 20%, most while still carry debt month to month ( credit cards, auto, etc.) although the amount is less than the average. When the stats are whittled down further for the number of people who do all the things Todd listed, that number would be considered...uncommon.
@@wjf5839 1 out of 5 is not considered uncommon. Uncommon is more like 1 out of 100.
At 3:00 I laughed so hard. I don't know what world Ken Coleman is living in. No business will care about your financial situation
He's just saying have a conversion. Get out there and don't just go straight for the credit card numbers. Have a conversation and try to knock down that price 20, 30, maybe 40% to help things going and pay cash for it. That's all he's saying!
@@costco_pizza HAHAHAHAHAHHAHAHA KNOCK PRICES DOWN 30-40% YOU ARE DENSE... Not one company is going to negotiate a 30%-40% reduction in price. They don't give a shit, why would they negotiate with broke people. Absolutely stupid take, on his part and yours as well!
Ken is the worst
Also think he's saying that they might allow you to pay it off in monthly installments with no interest. That's not uncommon.
@@nino-gs5yt lol no HVAC business allow you monthly payment with NO interest. Please get off drugs
In my opinion if you don’t have a fully funded emergency fund you need at least 1 credit card
I totally agree.Until then it is scary to throw all our money at our debt leaving us with only $1000 forthe "what ifs".
I am an Airline Pilot, which means I'm traveling every week for work. My credit cards have been a game changer and have saved me hundreds if not thousands.
1. Fraud protection. If my card info is stolen then it's not my money on the line.
2. Airport lounges. When I travel I get free food, coffee, and water when I fly as a passenger when I get repositioned by the company.
3. Points back. In my first year I redeemed American express platinum card points back into my bank account to the tune of $1400 cash in one night. With my Amex Gold I get 4.4 % back from restaurants and groceries. A credit card must provide the greatest value on essential spending not discretionary.
4. Free vacations. Instead of saving for one vacation a year, you can do 3 or 4 armed with points and that enhances quality of life. I've stayed in $1000 a night rooms with ocean views for free or for dirt cheap. I get free food at the hotels I stay at with my status that comes with a card.
5. Transfer of wealth. In order to pay for the cc swipe fees, business raise their prices. With a credit card the value you get back covers it. With cash it doesn't
A credit card is a tool. I equate it to alcohol. It can be used responsibly. Only spend money on things you HAVE to spend on. Pay the balance in full every month. Do not pay a dime in interest. I have 7 credit cards and shooting for 10 by the end of the year. My end game is spend a week in the Maldives flying business class and I want it to cost less than doing a road trip to another city. There's no way I'm giving up these tools. So respectfully, keep paying cash. You're paying for my rewards:)
You are speaking more logic than the Ramsey folks can process. As was said in the movie "A Few Good Men"- "YOU CAN'T HANDLE THE TRUTH!!!"
Never mind that many gas stations charge as much as $200 if you use your debit card at the pump. That’s a major inconvenience depending how much you have in your checking account.
@@PMack5 WOW! News to me, but NOT SURPRISED!!
Totally! CC provides the convenience and safety that you just can't get with cash and debit cards, provided that you're a responsible user.
My god these people do not live in reality. On what planet do they think a store employee will care or be able to do something about someone not being able to afford a new HVAC system and a payment plan will solve the problem?
America in general avoids reality
A lot of home repair is done by private business guys. It seems unbelievable, but some probably would do a payment plan with you, just like a hospital will.
@@KatieBellino But you're still in debt with them though
Yes, but you might avoid interest.@@esonon5210
Kens advice is to beg the hvac company to not pay them until later interest free? What planet is he living on? Outstanding AR is one of the biggest headaches for any business. The company may offer financing at a better interest rate then a credit card, but that’s still debt.
Dude, stop being weird. Contractors finance work all the time, especially for things like ACs in the Summer and furnaces in the Winter. And they do it for a LOT cheaper than 25%.
@@mickeypigknuckles that’s against the Ramsey way.
One big reason. Pickpockets. When I worked in Manhattan, my wallet was stolen twice in a month. The first time a neighbor saw the guy and he actually handed it back. Fortunately I had left my debit card home anyway. But i stopped carrying debit card or cash. So second time the thief got only my credit card and like a dollar in change.
Fear should prevent you from using a debit card. Having a card directly tied to your checking account where thieves and hackers now have direct access is not for me. I wasted 3 hours of my life trying to get back my money from my business checking account, that was fraudulently taken with a debit card that was never used or never left the premises. My guess is it was swiped by the mailman using an RF scanner. The address is on the letter, you have all the pieces of information you need to steal money. Had it been a credit card it would have been a 10 minute call with no worries on my part. I was mad for days after the event, and this just happened a couple weeks ago. I refuse to use debit cards that are tied directly to my checking account. It is way harder to get your money back, I don't know what bubble they live in here, but I'm a millionaire who's not getting rid of his credit cards. They provide an extra air gap of safety. You don't lose something the thieves never had.
Use a cross body bag that is forward facing or wear a vest with zippers which is the only place your wallet is in.
Lol I'm not wearing a fanny pack
@@fauxbro1983 Its not a fanny bag, its a simple, single-compartment sling bag. Wearing one also frees up my vest's compartment which contains my self defense weapons that I can easily quick draw so no thieves or pickpockets can ever come near me.
@@chaxologist2961 "Your self defense weapons?" In MANHATTAN?! What would such legally BE? A disapproving STARE?!!!!
I personally hate Dave's philosophy on this. If anything I am more irresponsible when I use cash. There is nothing wrong with using credit cards for your needs (groceries, gas, utilities, etc.) When I have to fill up my car, generally speaking at many gas stations cash is the same price as credit, and my tank will require the same amount of gas regardless of how I pay. When I need milk, the grocery store is not going to charge me more for the same milk I am about to consume. The credit card is simple, and gives me money back. Stop blaming the card, blame the user who doesn't know how to use it.
Well said.
I assure you the credit card issuers have studied human behavior and discovered that the "rewards" and whatnot that they offer cause you to spend more than you otherwise would have, to the extent that their fees cover the cost of the rewards.
ALL of the credit card companies that have not done this calculation are out of business or will be this time next year.
@SouthernLife7772 lol, so you're saying if I pay for gas with cash instead of credit, my fuel mileage will improve? interesting.
With out a emergency fund credit cards are a source of money you can pul from if you need to pay something immediately. People want to know they have them if something comes up period.
Between me and my wife, we’ve accumulated about $5500 in CASH the last 3 years. No miles, no discounts, just our 2% cashback. And no, we’ve never paid a dime of interest, and we have no debt.
I’m going to wait until we have about $10k and then take the whole family on a super baller FREE vacation.
You can take these cards out of my cold dead debt free hands.
you're one out of thousands. Most people can't do that. Also, the cashback you're technically getting is blood money from fees from poor people. It may matter to you or it may not.
@@yeahdude1986 To that I say not my problem. I'll exploit and earn extra cash for paying off my CC on time all the time and no regrets. I'm not gunna get guilt tripped into properly using a system and somehow be the one to blame because I COULD pay off my cards all the time.
Free money is money and if I spend that bonus cash means some single mom family starves I won't shed a tear. It the same braindead take of little timmy threw out his bowl of baked beans and a kid in Africa will starve, give me a break lol
@@yeahdude1986 visa and master card form portfolio of index funds. So are banks part of index funds. Even pension funds provide money to banks and make returns.
So, they are also enjoying blood money. 😂
@@yeahdude1986
Wrong. It's from interchange fees when they make purchases so it's simply their money going back to them hence the term "cashback"
@@yeahdude1986 who gives a shit about most people? You think Ramsey cared about people living in poverty? We ain’t solving world hunger and neither are the billionaires of this world. I, too, will exploit the system and use a credit card to earn points for whatever I wanna do. Don’t be an idiot like most Ramsey followers and opt for a debit card. Pay it off every week but enjoy the perks.
Biggest thing holding me back is international travel. My Citibank credit card had fraud charges twice in Mexico and one time in Peru, it was very easy to resolve and Citi bank provided credits to my account the same day. If it was my debit card it would have been a big problem because my account would have been shut down because i do not allow my debit card to overdraft my account. It basically could ruin someone's vacation if they did not have other resources or another card. And then your automatic withdrawals might bounce and you get NSF charges that have to be sorted out.
Lets make a list of HVAC companies that will let you make payments on an $8,000 repair.
Not having $10K saved is simply moronic.
No company anymore allows such. They require you take out their sponsored credit line to cover the bill so that they are paid up front.
@@truthseeker6370 No they require you to have the money saved up so you don't need to mess around with any of this credit rubbish.
@@amireallythatgrumpy6508 I agree in principle. See my next comment on this thread. It took me Many Years to save up my Emergency Fund.
Based on Several other Major Expenses at once, I have to step back and review all options as the total amount is beyond my Well funded EF.
Went on vacation once and used my cc for dinner one night and it was hacked. Got credit back from the card company glad it wasn't my debit card. Always pay my cards off monthly. Will keep my two cards which both have zero balances
My safety blanket is that I have a great relationship with my local credit union. I had an HVAC situation like that, went straight there, and got a personal loan for 1/3 apr of a credit card that day and paid it off asap.
The biggest thing that did for me was also realizing that loans take effort. The allure of credit cards is that it’s instant. You don’t have to suck up your pride and digest the fact that it’s a loan.
Try to rent a car at Knoxville airport without a credit cars. You can’t.
Exactly! I use cash for almost everything, but when it comes to travel I have no choice but to use a CC. At the Phoenix airport the rental car company charged me an extra fee because I didn't have CC.
I use a credit card as a barrier between where I shop and my bank account. I know I can work with my bank to get my money back, but if I can keep the crooks from being able to drain my bank account that's even better. I've had my card details stolen twice, and they didn't get much because of the credit card. I've never paid any interest, and I don't spend any differently than I did with a debit card.
That is one of the main advantages of a credit card as it places a disconnect between the transaction and your financial accounts. Ramsey would have you to believe that debit cards offer the same anti-fraud protection as credit cards, but every single fraud prevention expert would disagree with him - and I have nearly three decades of experience in audit and financial investigations.
@@lkj0822gIt does say it on visa and mastercards website that they’re protected soo?
I have 2 credit cards. I have not paid any interest in the last 17 or 18 years. I use them, I pay them twice a month. I have no debt of any kind. The cards stay, it IS my safety blanket, and because when you have good credit, everything is cheaper.
The only good credit is no credit.
The payment plan to HVAC guy is still debt...
I love my credit card. I set it up to automatically pay off 100% of the balance every month. Only essential purchases. Take a vacation every year.
Wait.. a "payment plan with th HVAC guy" is not debt?!?
How is that different from a "payment plan with the Lexus dealer"?
No reason for me to stop....i pay off every month and i already live well below my means.
you sure about it
@angel Live on 40% of income so yea I think so.
One of my primary reasons for fear is security, I am extremely careful with who gets any amount of info on my checking or savings accounts so I don't feel comfortable using a debit card, credit cards create a layer of separation and they are historically great about refunding any fraudulent charges
I went to go rent a car and they charge a fee if you don't a use a credit card. I love Ramsey's advice and yes you should have a zero balance, but for things like travel it's best to have one for an emergency.
Yup. I would never get rid of all my credit cards. My personal opinion is that one is needed in case of an emergency especially when traveling!
Travelling is to be avoided
@@amireallythatgrumpy6508 Well some of us travels for work and I can't skip that.
@@bamafencer12 Get a good job.
Hello I love this topic. I keep listening and was slow to start. Commited to not using credit, but scary. My 1000 dollar efund didn't cover me because I had 3 issues at once. My efund covered the washer, plus attemp to fix before replacing.
I sold a big item I had struggled to part with days before the crisis and cash flowed breaks. Side hustle plus cash flow I didn't have 6 months ago got through and redid my 1000 fund. 3rd issue was not a true emergency so I will save, work and cash flow it before fall when it will be an emergency. Not possible 6 months ago.
By design, when you’re doing this plan you have that fear until you reach BS3 and are able to have your 3-6 mos. The fear and discomfort in BS1 & 2 are real, especially for single income households. I love Ken’s AC story 😅 and George’s remarks of the illusion of being safe are spot on.
Than you sweetie I appreciate your words x
That's why you want to get to step 3 as fast as possible. Work 2 or 3 jobs, if you have to. Work split shifts if you have kids. NEVER use your kids as an excuse for not getting ahead. I know it's not easy - we did it - but it's the best thing you can do.
I never once paid any interest on my credit card.
No one have ever said they will get rich off it. That is a strawman argument.
Same here.
And Dave knows it. He’ll never admit it, but on many issues he is just wrong
You realize the average credit card dept per household is 5000$+ right? Just because you yourself don't pay interest because your able to pay it off consistently, doesn't mean the vast majority of people can do the same thing. People can't afford to use credit card especially with interest rates were they are now, they are in huge dept. It's best that most people pay them off and leave them alone if the can't be responsible with them.
The point of Ramsey's show is to gain wealth over time, so no, it's not a strawman. If you're not trying to get wealthy, then I'm not sure why you're listening to Ramsey's show in the first place.
This is one of those 99% decisions. The reason Dave is so against credit cards is because 99% of people are not going to use them wisely. Yes, if you aren’t susceptible to marketing or impulse buying and only funnel necessary (rent, gas, preplanned groceries) expenses through the credit card and instantly pay it off, you can make minor money back. BUT, 99% of people ARE NOT doing that.
Here’s what this means. If Dave acknowledges this and talks about it on his show, everyone’s going to start thinking they are in that 1% of people who can do it. But they’re not. And then they get in trouble.
Your own website states that 48% of people pay off their credit cards every month.
90 days without cash back? Nah, I’m good.
Id get rid of those cards AFTER an emergency cash reserve is fully funded.
i have a pre paid debit card only never getting a credit card
I’m keeping a larger emergency fund for emergencies but paying off all debt. Credit cards suck because you’re paying double with all the interest payments. It always feels so good to get creditors off my back by paying it off and not taking on more debt.
@@kathleenphillips7145 look at my statement.
Negatively impacts your credit score, cash back, and better protection. It's not complicated.
So they're addicted to the most asinine of concepts of all - the credit score. Only backwards countries like the USA have those anyway.
I use a credit card for internet purchases. If something happens, I’d rather them steal their money than mine.
Having a card directly tied to your checking account where thieves and hackers now have direct access is not for me. I wasted 3 hours of my life trying to get back my money from my business checking account, that was fraudulently taken with a debit card that was never used or never left the premises. My guess is it was swiped by the mailman using an RF scanner. The address is on the letter, you have all the pieces of information you need to steal money. Had it been a credit card it would have been a 10 minute call with no worries on my part. I was mad for days after the event, and this just happened a couple weeks ago. I refuse to use debit cards that are tied directly to my checking account. It is way harder to get your money back, I don't know what bubble they live in here, but I'm a millionaire who's not getting rid of his credit cards. They provide an extra air gap of safety. You don't lose something the thieves never had.
Either way you have to report it and you'll recover the money if it's debit. It's FDIC.
The biggest thing holding me back is that we have 9 digit debit cards and 16 digit credit cards. So it’s impossible for me to buy anything online in a foreign country with my national debit cards
I think Ramsey would be best suited arguing, “It’s a behavior issue, not a math issue” with credit cards rather than the junk science arguments about “spending more” with them (you definitely DON’T if you have something called a budget) or arguing a debit card can do the same stuff anyway. No, a credit card can do what a debit card can do but for 2% cheaper. That’s the actual math. Argue about behavior, not math. Still won’t convince a decent chunk of people anyway, many of whom are already on Baby Step 6 or 7 (including me).
And 95% do not have a budget. We're talking about Americans, not intelligent people.
Only reason I still have one is for work. It requires a lot of travel so instead of using my debit card, I use a credit card which I can claim my expenses through the company I work for. Obviously I get reimbursed and I essentially get free credit card points.
If I get the same protection for my money that I do for the bank's money, it's still safer to have the bank's money at risk.
You absolutely need a credit card for online purchases. Never ever use a debit card.
Online purchases, overseas travel, random point of sale at obscure retailers, rental cars, hotels, the list is long.
@@lkj0822g Exactly. The only place I use a debit card is at an ATM inside my own bank. Way too many card skimmers out there.
Never buy anything online AT ALL! That's simply asinine.
Most websites take PayPal. Amazon doesn't, but you could purchase an Amazon gift card, available at a lot of grocery and drug stores.
That young man's headliner story hardly compares to a family in northern Maine that loses their furnace in the middle of the winter and needs heat now or will die of exposure. Noone in their right mind wants to borrow money at 28%, stuff happens sometimes life puts you in a bad place.
I know! You can so tell that they are in the south. They always bring up the HVAC and as a fellow Mainer, I'm like, "Try the heating system in January!"
Have an Emergency fund all. As simple as working a side hustle 3 hours a day, 5 days a week, 52 weeks, 3 years @ $12/hr is approx. $25,000 after taxes.
I am 70 , and I have never had a credit card and never will
My thing has always been, I don’t spend nearly enough generally to make cash back worth it. A couple hundred dollars annually isn’t worth it when I know I’m spending more to try and get rewards. The psychology here is very real.
I recently had to stop payment with my credit card because the company i ordered a product from did not ship the product but they charged my credit card for the sale. The credit card Capital One froze the payment for 90 days unless the company that charged me disputed the nonpayment. I finally received the item nearly 40 days after they billed my credit card. But, I finally paid the bill after the freeze about 60 days later and canceled further business with that company. I was told that the product I ordered was sitting in the US postal service in Kansas City, Missouri.
I've not used a credit card my 17 years of adult life until recently. Was all to bump my credit score to buy a house. Still debt free. I keep the balance low. It's only a 200$ card. I had no idea about manual underwriting til this show
I'm 20 and got my 1st card July 2022. I was excited to play the game, but ONE VIDEO changed my whole perspective. I'm minutes away from cutting my 4 cards!
@@Bidenlost2020 that is great news! Have you cut them up yet?
@@Dab_Marino I just did! I can't believe what I just did, but no more financial slavery! I recorded it too!
The fear is real. I still have my credit cards. I have only used them sparingly and have paid them off every month since getting out of debt several years ago. My fully stocked fridge went out. I had prior been planning to replace my defective stove and dishwasher. Wasn't planning on the fridge too! Bought new medium range appliances with 24 months interest free.
Now mind you I've also had 2 main line sewer backups in 10 months ($1600 pd in cash), and now need 2 new toilets. My 14 yr old Hot water heater and HVAC are due to die momentarily. That's a Heck of a lot of money in short order! Also the seals on my windows are broken.
I chose 24 month interest free financing on my appliances- because of the magnitude of what is to come in Short order. I have the money in my Emergency fund to cover the appliances with some buffer, but definitely not Everything.
I'm okay with paying off the appliances interest free- while adding to my Emergency fund.
The totality of these major repairs all needed at once is beyond overwhelming.
I don't put Anything frivolous on a credit card. I live most frugally. I make my own coffee every morning and take my home cooked leftovers for lunch. I was so grooving on watching my Emergency fund grow for many years- Gave me Great security... til everything decided to die at once.
Most people hopefully won't ever experience a sewer backup and not be able to use their shower or toilet for 5 days, as I did. It was a living hell.
I think there is a change going on in the system. The major cc companies use to not have debit cards and now most offer them and some with cash back. It’s taking a while but there is a change going on.
Got rid off that crap long time ago.
Simplicity....
I've had my CC on auto-pay for many years, full balance. I use it exactly as if it was a debit card.
For years, I had the "cash back" redirected to a charity. CC stopped that program, now it goes toward balance on the card, not enough to really care.
Changing would mean making sure every monthly bill that charges to the card gets changed over.
Electric, trash, auto insurance, cell phone... I forget what else. (There's not much else, and I check the bill carefully every month.)
It really is the path of least resistance.
And I went debt free (paying no fees or interest to the CC) years before hearing of Dave.
I was "Dave-ish" before I heard of Dave, but the main deviation is, I didn't cut the card.
The only deviation that I still have at essentially Dave's Step 7.
I'm strange. Never had the huge debt. Paid cash for a house. No student loans ever.
My credit card gives me cash back and it creates a buffer between fraudsters and my direct checking account.
So much safer for transactions as your bank wil freeze your funds and life will suck for about a week to a week and a half if you have fraudulent charges. Call your cc company and it will be wiped clear instantly. Pay it off every month, it isn't hard
I only use debit cards and I've never had my bank freeze my funds. If I see a fraudulent charge, I call my bank, they take the report, and put the money back in my account while they investigate.
@@AllynHinI have and you can't use your debit card for a handful of days until a new one is sent in the mail. Glad your bank is better than average
Truth!
This is true of credit cards too.
This is similar to my reason for keeping credit cards, though I’ve never had a freeze on my account. But when I’ve had fraudulent charges at 2 different banks, I had to spend several weeks trying to get the charges reversed. My credit card, I reported and was done with the issue. But I’ve never paid a cent of credit card interest, in 14 years of having one.
Too many people see a credit card as an immediate emergency fund.
Its their own failure
So why not cut your card as you build you emergency fund. Build up 3000. Cut a 3000 limit card.
Good idea
Credit card is just a debt free tool for spending cash with me.
I have a six figure emergency fund.
@@blackworldtraveler3711 flex much
That used car you preach go out on you guy? Whoops!
You'll pay a lot higher insurance rate if you don't have a credit score. - Dave Ramsey
There are also certain jobs you will not be hired for, such as many in the finance industry, and it will limit who rents to you and for what price (if you are a renter). As for buying a home, it is just intellectually dishonest for Dave to pretend like manual underwriting is easy and doesn’t charge a slightly higher interest rate
@@MeowmyandMe Jobs that you don't want to be hired for (i.e. TOXIC industries)
I’m not getting rid of my credit cards I have enough self control to not go over what’s in my checking account on credit card purchases and it been like that for the last 6 years
Amen. People need to take Ramsey advice with a grain of salt. These are the same people who will tell you to pay off your 2.5% interest rate mortgage faster instead of investing the difference.
@@JonathanIvy221 that’s actually not bad advice tbh. No rent or mortgage frees up a lot of income so that you can invest more aggressively, what I don’t agree with is that they make you think you have to choose between one or the other, when you can do both and all you have to do is allocate more money to the mortgage and less to
Investments so you can reap the benefits of compounding and have the extra income freed up in the future
Overall I agree ideas expressed on The Ramsey Show. However, I think this was all a little pompous. You guys assume that you are always right and everyone is a moron. If your furnace goes in January and you live in Michigan having a credit costs me nothing but gives me options. If I get a call that my sister is in Europe, had an accident and I should get there now I would be happy to pay %28 on $2,500 airline tickets so that I can be on a plane in 3 hours. We all pay for car insurance even though most people rarely use their car insurance. Pretending like "just in case" is bad is a not a good look.
We're talking about Americans here, so it is a fact that everyone is a moron. If they weren't, they wouldn't live in the USA.
You are correct. Ramsey has good ideas......however in some instances like credit cards Dave has made those ideas into rules. Nobody gets a credit card ever.
Honestly, I only keep mine because of the company’s user interface. It makes it easier to budget. I tried to switch to using my debit card but it wasn’t worth the trouble.
We’ve been using our credit card for YEARS to pay for Christmas at the end of the year with the cash back points. We charge everything we can on it and pay it off WEEKLY. In 15 years we’ve NEVER paid a dime of interest. Self-control is the key. If you don’t have money in the bank to cover it, don’t use it.
This is absolutely right - I hate how Ramsey shames people for doing this. I guess most people lack self-control, is why they have to do so.
Ya but you’ve paid more over that time. Sure no interest but you would save that “cash back” just in the money you wouldn’t spend if you just used a debit card. Try it for a couple months and see if you save money.
@@JoeLanthier No, I've stuck to my budget on Every Dollar app for years, and under spend. I use my credit card in place of a debit card and pay it weekly. It's not rocket science.
@@JoeLanthier How so? We never spend because were able to put it on credit cards. We are extremely frugal.
If that's what you guys do then great! But just don't encourage others to do the same. The whole point behind Ramsey being against them is not because of people who pay them off on time, it's because of the people who fall into the trap of using credit cards. I personally was part of that group. Racked up debt because I was told by multiple people that "It was the right thing to do" Well every since I've been out of that hole, thanks to the Ramsey team, I will never look back and will never use a credit card again! You do you, but for the majority of people, credit cards are the reason they collect that debt. We all are against debt and when you know credit cards are a huge part of that debt, how can you participate? Imagine a single mom who is struggling to pay her credit card and is charged interest. And then that interest get's split between the card company and then a little bit is shared with you and the others getting cash back. Just imagine taking that money when you know it was because of that poor lady who just can't make ends meet. Ya that's what happens everyday. Think about it....
Credit cars are a fantastic tool as long as you can pay off all your balance in full every month. If you can't do that, don't use a credit card. If you can, use them as much as you can to get the most benefits.
You guys talking about people who don’t pay off their complete credit card balance at the end of the cycle. What about the Costco Credit card? I use it for gas and other house whole goods and pay it off every month with zero balance. I get money back and credit score stays high. What’s the problem
My credit card got skimmed and over 7 gran was charged up over the course of a month. It was straightened out within a couple weeks.
Healthy fear, it's easier to recover credit from fraudulent charges than with cash on a debit/check card.
Not everyone uses credit cards to incur debt. Pay off the statement balance every month, and the transactions are safe, plus cash back rewards, and building credit history to qualify for home mortgages. 👍
Fear should prevent you from using a debit card. Having a card directly tied to your checking account where thieves and hackers now have direct access is not for me. I wasted 3 hours of my life trying to get back my money from my business checking account, that was fraudulently taken with a debit card that was never used or never left the premises. You don't lose something the thieves never had, and I would rather it be the bank's money than mine..
@@XennialGuy Exactly. On the other hand, I get a $500 fraudulent charge on my Amazon Visa, I give Chase a call, charge is cancelled, then they issue me a new card and number. Done! 👍
I HAD to get a credit card to pay the dentist. It was $5k after insurance for three root canals to stop an infection from spreading. The other option was a tooth extraction which I will not do just because I didn't have the money up front to fix them. That debt is easier to clean up than replacing missing teeth.
an implant replacement would’ve definitely cost u over $5k too! as someone who was neglected as a kid and had to have almost everything extracted due to it, i can definitely tell u borrowing that $5k was the best thing u could do at that moment 😂
I dont like the debit cards with a hotel. I pay it off immediately.
In my opinion, if people are always paying attention what they have and their need, I think credit card and debit card just the same. But they may give some advantage in cases as live by check by check, unexpected expense or just like business owners are taking loans for their business.
In other hands, credit cards are seriously traps that will lead people to forget to pay attention why they really have to pay back credit cards.
I think using a credit card may depend on conditions and choices of people.
I keep my two primary credit cards because they give me great benefits, and i have not paid a bit of interest in well over a decade. There are people that can reaponsibly use credit cards, it is not all or nothing for every person
I've had the same credit card for 22 years I rarely use it.
Haha the “Debt Gods” were trying to get you
I personally agree with not using credit cards i got myself in a whole that it took me a year to get out of and I’m so lucky but I agree it hurts more when your using cash then plastic I’ve done both and it’s all
Mental behavior when you have a credit card you see the money and wanna go ball out
I have not paid a penny in interest or a penny towards a hotel stay in 14 years.
what about protection against fraud? credit cards will front the bill in some cases for fraudulent purchases where your checking account will not have the same protections. This happened to me personally and having a credit card saved me $10K+ against fraud from identity theft.
On sudden big expense that people has, emergency that no one can lend you.
I love my credit cards. I have like 11 of them. I haven’t paid any interest on them my whole life with the exception of balance transfer fees.
I track every single transaction in a google sheet so the pain of swiping is identical to swiping a debit card and I pay my monthly spending off in full every month.
Besides the rewards and points and sign up bonuses. I also love using balance transfers.
I paid for all my student debt and masters degrees through credit cards. I had enough Money to pay off my bachelors degree. But I didn’t have the money to pay off my masters. Got a couple credit cards at 0% for 18 months. Paid them off within the 18 months. Way better than paying for a student loan.
Years down the line I needed to borrow money from my parents for a real estate deal down payment of around 100k. they charged around 7% interest. Used my excellent credit and got $60k worth of balance transfers paying around 2% interest instead. Within a year I paid off the rest of my 7% Loan and did another BT for around 2% bt fee per year of 0%. And we expect to have the rest paid off by the end of the year.
Credit cards saved me about $8k in interest over two years.
I just don't see why would I close my credit card accounts when I could just keep them open with a 0 balance. I about 150k in available credit. If I ever want a loan or anything or the sort creditor's would see that and approve me. Why would I get rid of my credit? There is of benefit of doing that
It's called a headliner
*CASHBACK* Period
Credit scores matter, you can't really say they don't with a straight face.
On the Ramsey show they believe credit is unnecessary. They get mortgages using income verification loans. It unfortunately limits you to a small select few banks, and despite what they say, it is a higher interest rate in most cases though. I actually used the same philosophy many years back when I was in my late twenties and didn't have credit or a credit card, but it was so difficult to do certain things like rent a car with a debit card.
Then why do they only exist in backwards countries like the USA?
@@XennialGuy Only if you're not smart enough to be able to negotiate properly.
@@amireallythatgrumpy6508 I'm actually a master negotiator, I didn't become a millionaire being stupid, so yeah I would say I'm smart enough. Still doesn't make it worthwhile to use a debit card.
@@XennialGuy You're American. That means being stupid is the only thing you know. Smart people don't come from that particular country.
Well my credit score is 836, I work long and hard to get it up there. There is no way I throwing my 836 credit away.
I have had bad credit in my 20-30 and early 40s. I can now buy whatever I want, but I don’t because I ain’t about to mess up my score.
Oh and I got like 120K in a CD and about 55k in 403B and 2 other pension coming in with my 75K a yr job.
I haven't used a credit card since October
I don’t like handling physical money. It is gross and inconvenient as a guy to carry it.
Most credit users aren’t disciplined like anything else
I don't have credit cards, never had one, I live with debit cards and cash. Not saying I won't get one, one day but it will only be for me to use it for major life changes. Not on things that will get me in trouble. Because I fear owing, debt and being hunted by banks.
Zero credit cards and a happy debt free man 🎉
I follow much of Ramsey's principles, even before they existed, and am a Baby Steps MM. My biggest critique of Ramsey Solutions is their 1-size-fits-all approach. In their minds, everyone who uses a cc is reckless & irresponsible - even if they pay it off each month. Their investment advice is sound, but tweaks should be made depending on the age of the investor. Someone in their 20's can withstand a bad bear market much easier than someone within 5 years of retirement. People nearing retirement should have a stop-loss threshold that, when crossed, they temporarily de-risk into more stable investments to ride out the storm.
Am I brave enough to be confident in my finances to know that I can use credit cards responsibly and benefit from the rewards? Yes, I am, thanks for asking
Lol "rewards." Do u realize visa and Mastercard has employeed behavior psychologists,marketing agencies and focus groups specifically to get that response out if you
@@fauxbro1983 If you can budget and be intentional with your money, there's really no reason to not use a credit card. I don't need a focus group or research to tell me that if I budget $100 for groceries, I'll save 5% by spending that $100 on a credit card vs a debit card or cash. The studies showing people overspending are people who don't budget and aren't intentional with their money. It's time to graduate and be a big boy instead of feeling like a hopeless victim
Good job.
Credit cards if used right only really helps people who are midmaxing small gains. Small gains here and there adds up. "1$ now is 88$ in retirement"
Other then that you are working for the credit card company, by making them money. Living off a card. Where a lot of people find themselves.
Security is way better. Debit cards do not cover you. You have to go into and check each purchase with in 60 days. Noone does this. Credit cards you call and they cancel the purchase. Debit cards you cant cancel if its stolen.
sorry but if you go to your HVAC company and talk about not having the money they will laugh you out the door or offer their own financing most likely , local contractors post covid have been very expensive and brutal with their prices so your not catching any real break with them . my parents got a home generator and they charged 14 grand just to install it because they are the only ones in town that had them in stock and ready to install not with a 6-12 month wait and when my parents added a new addition to the home for my grandmother 1 room and 1 bathroom cost as much as the whole home cost in 1992 and the quality is bare bones code not like the rest of the home even
I get it, but some people just want to enjoy some things instead of waiting years and years of skimping to go on one trip or buy something nice for themselves.
There are definitely lots of things people want, but it's just wanting nice things you can't afford is not nearly a good enough reason to get them. Part of maturity is learning to say no to yourself.
@@strategicsage7694 yeah like a house
Trips and clothes are the things that you very much should not use a credit card for if you can't pay for it in cash.
@@christopher7725 You have to live somewhere, so you pay rent or you pay mortgage. Many people should say "no" to the bigger house though and buy within their real means.
Having a human conversation with a company? I'm a fan, but that isn't the way companies work. Most have been taken advantage of before. Blame whoever, but most don't offer in store financing and if they do....there is interest.
Dave has done much to help people better their financial position - that's indisputable. However, he intimates that his method, strictly by the book, is the ONLY method that works and that is just not true. The overall principles are sound, but there's more than 1 way they can be applied. Label me Dave-ish and that includes responsible use of cc's for things I would have to pay anyway, and I pay the cc off every month. None of the Ramsey personalities would dare disagree with Dave (Rachel comes closest) because they would be fired and they all know it.
security.....ease of use......Pay off every month not an issue.....do not have a debit card....and would not........
CC will not hit you for 20+% if you pay off every month.....
The cope is real. They have to misrepresent card rewards as though they're airline miles and travel points. My card gives me cash back, 1-3% depending on what I'm spending on. I can elect for them to send me a check if I want. I spend what I'm going to spend according to my budget. With an automatic discount of at least 1%, it would be irrational NOT to put every dollar I spend on the card. I put my property tax and every utility I can on the card. And I pay it off monthly, so I've never paid a penny in interest (30 days of free credit, where my money can accrue interest in the bank). I understand that Visa takes its slice from the merchant; prices of goods already reflect that, regardless of the form of payment. I'm just recapturing some of that expense. On top of that, credit card fraud protections are superior to other forms of payment, including debit cards. And, even better, I have every dollar of my spending recorded in a single place where I can analyze trends and hold myself accountable.
Maybe bc wages haven't grown in 40 years and inflation is beyond out of control
Not if you listen to Biden, economy is booming 😀
Opened the news today to see that TD bank in Canada has an outage affect all direct deposits, debit purchases, etransfers, and ATM withdraws. Can't get money, can't buy groceries using debit... credit card is the only thing that can be used today.
Fear can be healthy because it allows for backup plans. Fear is also why there is an emergency fund.
I was once on a business trip when the bank's system went down. I didn't have access to my debit card or primary credit card. Fortunately, I have a secondary credit card issued by a separate bank, so I was able to pay to travel expenses without interruption. If I had followed the Ramsey lemmings advice, I would have been up the creek.
While I don't have anything against keeping a credit card around, the other solution to this is to always have an emergency stash of cash in the home, so that you don't NEED the ATM.
If nothing works then everything might.
Become you own credit card!
Here in the UK credit cards have extra protection if a purchase does not turn up or an item is faulty as the credit card company is liable along with the seller so it is worth paying for big purchases that way and then paying it back straight away.