I have a confession. Though Dave Ramsey fanatic and groupie I am, I have in my hands a credit card that I accepted. In In Women & Money: Owning the Power to Control Your Destiny
Suze Orman recommended that I get one in my own name. I did.
Don’t tell my Dave Ramsey Financial Peace University Counselor.
Truth be told, and I’ve been candid about this before, my husband and I got into some financial trouble a few years ago and cut up every credit card we had. We had vowed never, ever to get another credit card as long as we lived. Man, I wish I could have lived up to that.
But, here’s the thing, in The Total Money Makeover: A Proven Plan for Financial Fitness
, which I highly recommend to help anyone and everyone develop a sound and healthy respect for their money, Dave Ramsey asserts that you don’t care about your credit because you’ll never need it.
Pay cash for everything, Ramsey says. I’m a total convert to the principle. However, I’ve discovered first-hand four real world scenarios in which I NEED a better credit score.
* We haven’t bought our first home. We’ve been approved for 100% financing, but the interest rate isn’t that great. If we had a better FICO score we’d be offered a better rate. The way to get a better FICO score is to use a credit card and pay the bill. Having no credit card only allows the clock to tick on negative credit and doesn’t improve the score much. It would take us a couple of decades to be able to pay cash for a home and I just can’t muster up that kind of dedication to the cause, while we suffer terribly from mold allergies in our current residence.
* I’ve been denied employment due to my poor FICO score. It’s embarrassing and humiliating to admit, but I’ll tell you so my fellow poor-credit citizens don’t feel so alone. When we were paying off our debt with extra crappy jobs a bank denied me a job as a data entry operator because of my poor credit score. While I’m working from home now, I need to know that I can get a job if I need one. I also need to know that my husband can look for another job should he need to.
* We can’t afford to lend my husband’s employer money out of our monthly budget. Most companies do this, I guess, but they expect you to charge expenses on your personal credit card and reimburse you later. Well, if you don’t have a credit card that comes straight out of your monthly zero-based budget. Who can afford that? Dave Ramsey suggests that we should have a savings account for this. But, on what planet do I have enough money laying around to lend to my husband’s employer so he can go on a business trip to Chicago for a week? Not planet Earth, which is where I live.
* The last reason is that my FICO score is effecting the rates I get on my car insurance and will effect my home owners’ insurance rates.
To be honest, I’m totally conflicted about my choice to get a credit card. Suze Orman recommends that I have one in my name only. I do now. But, I wish I could have boycotted credit card companies forever.
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