"Deliver yourself with Gazelle-like intensity" (from your debt)

[Anonymous]

More than you know-

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@haulingthescoreup wrote:
Now THERE'S a sacrifice!

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[Anonymous]

Now that is one area I still quite haven't been able to tame--LOL. I wish good beer was less expensive.

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@Anonymous wrote:
I have found a few spots to reduce- like my beer budget =(

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@haulingthescoreup wrote:

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Timothy wrote: Yep- You should have seen the look on DW's face when I told her she used up the entire grocery budget for the year (Oct 1st) and what is gonna get cut from the budget to make up for this?

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I'd say you'd better get used to boxed macaroni and cheese for the next 3 months.

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[Anonymous]

Get ready for a bunch of folks to bash the debt free idea.  I've posted similar comments as yours and many people feel they are so smart financially, they've got the system beat.

Try reading the one time best seller, The Millionaire Next Door and you will discover how self made millionaires live.  They drive Ford F150 trucks and live in a paid for home.  They don't blow money on expensive watches or jewelry, and they sure don't owe money on credit cards. 

They own businesses like bowling alleys, and spend less than they make.

And I plan on being one by doing the same things they did.

[Anonymous]

Yes, the point is to be debt free--that doesn't mean don't use credit cards. The keyword here being USE. People should USE credit cards, not be USED by them.

There are just too many good reasons to buy things with credit and then Pay in full once a month. The key is to tame your spending with a budget that you stick to.

I'd say first priority is to pay off bad debt (CC's, car loan). Next step is to learn to use a budget for a few months or so without using credit cards at all--I think people need to realize that credit limits are not an extension of your income--if they were, then we'd all have much lower limits.

Once you stop looking at limits as more money to spend, and simply just a way to organize your cash flow month-to-month, track purchases, and have purchase protection (debit cards don't do this), then I say go ahead and use them. They are your financial slaves to use as you wish.

After all of this, then think of them as vehicles to earn stuff--like airline tickets and cashback and things.

[MidnightVoice]

FICO Truisms Credit is not always debt. Posting in red does not make a post any more accurate

[Anonymous]

Hey, cspar1212-

I'm a huge Dave Ramsey fan, and if you really want to know what Dave would say about using credit cards to build your "credit" score, here it is:

He'd say of course this forum is telling you that the only way to build your "credit" score is to have and use credit cards, because Fair & Isaac Corporation (sellers of the FICO score) is just as much a product of the America's dependence on debt as Visa, MC and Discover. And still, somehow, they've convinced us that they sell the one thing that we need more than anything else in life in order to succeed financially. And we all believe it!!! Well, I used to.

He'd say your "credit" score should really be called a "debt" score, because all it is, is a report on how well you manage debt.

I know from having attended two of Dave's live events in recent years that Dave Ramsey doesn't even have a "credit" score. No, I didn't say he has a LOW credit score. He doesn't have one--period. Because in order to have a "debt" score, you (duh) have to have debt. And he doesn't. And he won't ever again. If any of us could go seven years without having any open lines of credit, and thus no debt, we'd drop off of FICO's radar as well.

As for being able to get a mortgage, he spends a good portion of his live presentations on this. You CAN still get a mortgage without a "debt" score. You may not have as many options of where to go to get funded, but Dave says, if you go to a lender that does actual underwriting (more lenders than you'd think), you can make a case to get approved on other criteria, other than a "debt" score. Underwriting is essentially a much more in-depth study of someone's reliablity to pay back a loan than a three-digit number, taking into consideration a far broader scope of factors than credit limits, debt-to-limit and debt-to-income ratios.

As for me, personally, I'm not there yet. Since being introduced to Dave and his plan, I'm still on the debt snowball stage (Baby Step #2). And with a mortgage, I realistically won't be at the "No Credit Score" stage for a very, very long time (if ever), but that doesn't mean that it's not legitimately the best way to go. I want to be there. I never want to owe anyone another dime. And with Dave's help, I'll eventually get there.

Hopefully, you can too.

[Anonymous]

I too am a Dave Ramsey fan but only up to a certain point.   For getting out of debt he is spot on.  For tips on building up your savings and looking for some investments, again spot on.  For paying down loans and such as early as possible yet again spot on.  I've used his snowball effect and I think it's great and reccommend it to anyone who is drowning financially.

But for removing yourself from the credit world?   That's where I think he's a little off.   You see for someone like him who is a multi millionaire it is very very easy to be off the FICO radar screen because he can afford to be.   For the rest of us average Joe's it just isn't that simple.  As you mentioned about getting a mortgage with no credit history. while yes that may be somewhat true but you are limiting yourself to very few options and it is much more difficult to get one.   The same goes with a car loan.   Your interest on not having a score will be higher and much more difficult to get financed.   You see by leaving the credit world you putting yourself into much more difficult world to live in.  Because simply, that's not the world we live in.   So much depends on a solid credit score, from the above mentioned, to renting an apartment, some job positions the list goes on.

I agree 100% on trying to be as debt free as possible.   I mean who doesn't want more from their paycheck.   And I agree that there some people, on here, that are slaves to the FICO score and are making, IMHO, whacky decisions based on fear of whether or not their score will change.   For example someone posted not too long ago that they have come across some money and was thinking of paying off a loan but was scared too because he/she was fearing their FICO  score may go down.   To me that's insane.  You have a chance to get rid of a debt and could take that money they have been spending each month and could have put it towards a vacation, invest, savings, paying down other bills etc.    Someone quite a while ago was thinking of opening up an account at a dfferent bank because it had better perks and better interest rates but was hesitant because of fear of a hard inquiry.  AGAIN INSANE.   You should never be such a slave to the FICO score that you are making silly decisions that could have benefited you and your family financially.  

So the true answer lies somewhere in the middle.   Again Dave Ramsey can go through life without a car loan, credit card, mortgage etc because he makes 7 figures a year.  And people who make that much don't need credit.   For the rest of us who make 5 figures a year that life style is just not possilbe.   Having a credit card can provide financial security incase something strange or unexpected happens.    I know in my case a couple of weeks ago we had to bring in both of our pets to the vet.   Did not plan on this   vet bill was almost $800.  Did not have that extra money on hand.  Couldn't tell the vet if they could wait until the ING withdraw comes through.    But paid with the card, withdrew the money and paid off the bill before any interest hit it.     And that's just a vet bill.   I know what your thinking. "well if you follow his plan you would have that emergency fund". true but that isn't always going to be the case because it takes time to build up that emergency fund and life doesn't wait until it's ready to spring things on you.  

As with what other posters have said  you can still live in the credit world and have a card or two, use them on something small each month and pay it off before the bill comes and still live debt free.   But at the same time you have that financial security in case something does come up.     I'm telling you right now if you choose to leave the credit world ,unless you make alot of money, you going to live in a very very difficult world where alot of doors will be closed to you that otherwise may have been WIDE OPEN. 

[Anonymous]

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Ramsey_fan wrote:

 If any of us could go seven years without having any open lines of credit, and thus no debt, we'd drop off of FICO's radar as well

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That's assuming of course that you don't ever miss a rent, utility or medical payment.  Because they will report those things.  Just ask anyone here who may have that as a collection account on their report.  Paying by cash or check doesn't guarantee you'll never have a FICO score   

[Anonymous]

First post that I've made. I've enjoyed the education and laughter from reading posts for about a month now.

On to Dave, I think that there is a lot of good in what most have said. Following anything cookie-cutter fashion is tantamount to being a bot. Use what improves your overall financial situation in life and allows you to pass on generational wealth to your children, assets, knowledge and a history of sound financial decisions. That which is not helpful to you, shelve it until it may be useful to you or someone else who seeks out your wisdom. Dave is made wealthy by the same mean that FairIsaac is, by those of us who are seeking a better financial situation in life, and of course, the more we spend on FI, the less we have to purchase Dave's wares, making him wealthier in the process, so that it ensures he never has to worry about a credit score.  Since, really, Dave is Dave, Inc., his score is probably with Dun and Bradstreet, as opposed to FI.

As for those millionaires who live beneath the radar, many of them are able to do so, because they were given, 'inherited' wealth, a financial heritage from generations prior to them. And, while they are not advancing the wealth, for the most part, they are holding onto it by not being caught up in a consumer crazed spending spree. There are a few, who have advisors who allow their money to make money for them. However, most people who work, I mean those that make up to $100K a year, won't become millionaire's by being misers. However, being a millionaire, while certainly, having its advantages, is not the be all and end all in being financially independent in life. Has anyone heard of Osceola McCarty, the domestic who didn't even know how much wealth she had, yet established a scholarship fund with her savings at a University in Mississippi?  There is no virtue in being poor and no necessary vice in having millions, it is how your wealth serves you and those beyond you that matters. That is, as juxataposed to how you serve your wealth or lack thereof.

I believe that the value in the Forums is in the sharing of persons who truly want to help and be helped by others at no costs to those who share in the struggle for financial well being. So, if you convince Dave to give his books, courses, events and etc. away at no costs, I'm pretty sure that Tuscani, Hauling, et. al., will be able to convince FairIsaacs to do the same?

[Anonymous]

"Following anything cookie-cutter fashion is tantamount to being a bot."

Definition of BOT:

A program that runs autonomously, and which performs repetitive and/or remotely-controlled tasks, from very simple IRC commands to incredibly complex online manipulation.

As Vintage Silk eloquently put it, relentlessly following a few sets of directions leads to being a bot--or a TOOL as I like to put it. IMHO, just because you had financial trouble and did not understand what you were doing, does not mean that now you should just listen to what one man says and base your entire financial future upon it--that's what impressionable middle-school children do.

I'm starting to hear some very common phrases coming from these ramsey-holics now "What would dave do? What would dave say? What would dave think? MY lord--has Dave become like Jesus Christ to you? --Ok I'll calm down, I think you see where I'm coming and going with this.

Point is: THINK FOR YOURSELF. I know it's sometimes easier to just trust what someone else says, and not bother to think through it, or to read between the lines. But these are serious matters.

Must seem Ironic, as I was the one who created this post and I do like Dave in many ways. You can still admire what someone has to say and believe some things they say about money and not have them become your Financial Savior.