It is Official I Am Credit Card Free!

shaintiques · Oct 8, 2013

I have had the same credit card since college, an awesome Darth Vader edition, which used to earn me cool Star Wars Memorabilia, but they discontinued that program. But that is besides the point. I have been going through Dave Ramsey's Financial Peace University, my wife is teaching it, and the program convinced me to get rid of my credit card. All of the excuses that I have made over the years for why I need one have all been empty and we are working towards having a debt free life. Getting rid of my card was a big step for me in that direction. I used to just buy things and use the card as a payment plan, but interest would rack up and I would spend more money than I had, now I save up and buy things when I actually have the money. What a crazy idea! Now I'm working towards our future rather than working to pay the card. I officially closed it today and plan to never open another.

flyguy · Oct 8, 2013

Congratulations! I have read Dave Ramsey's book and am completely debt free. However, I held onto my one credit card for online shopping. Zero balances on a card at the end of the month is important since I am retired. I don't feel a debit card offers the security of a credit card and I do not want to carry large amounts of cash when traveling. This is my only departure from Dave's rules. Anyway, zero balances on credit card = zero interest paid. This does take self discipline and if I fail to use discipline, I will get rid of my credit card.

I do want to encourage you in your decision as you really can't go wrong with Dave's plan.

voorhees · Oct 8, 2013

Good job Dave! I only had a credit card once with my ex wife, she thought it was a "free money". I closed it and never got another. That was 1999. I have never needed one.

shaintiques · Oct 8, 2013

I have actually been credit card debt free for a long time, and we keep the balance at zero, but I have found I don't really need it and I need to have the save mentality, save for emergencies for example rather than being tempted to use the cc for that. Just one step in building for the future.

flyguy · Oct 8, 2013

You are right, shaintiques. The credit card can lead you down the path of spending more than intended. I would be the last guy to try to talk you out of your decision!

mrjerke · Oct 8, 2013

Shain- Congrats on being debt free, but you are missing out on one thing. I work in Finance for a living and this is my recommendation for anyone who can do it. I put all of my everyday expenses and bills on 1 credit card (a rewards card with no annual fee) and pay it off in full every week. It takes me 2 minutes with an online transfer. Thus I never pay interest and easily earn hundreds of dollars in cash back rewards a year. This also improves my credit score which in turn gets me better interest rates on any other auto/home loan.
Now obviously this is not a great option for people who buy things and don't pay them off, but with a little discipline you earn free cash for that next tobacco purchase. Just treat your credit card like a debit card and enjoy the benefits!

sablebrush52 · Oct 8, 2013

Congatulations! I'm debt free and have been that way for the past 11 years. That said, a credit card is a sometime necessity for me. Without a credit card, I could not get my kid enrolled in classes at the Community College as enrollment is made online and payment has to be immediately made that way as well. It is possible to go to the campus and pay by check, but by then core classes have long since been filled and your kid is screwed.

Renting a car when on a trip is another occasion where a credit card is kinda necessary. And, as mrjerke pointed out, responsible use of credit improves your numbers. Mine are in the mid 800's.

So, yes, get rid of debt. But don't throw the baby out with the bath.

crazypipe · Oct 8, 2013

I don't have any myself , just check or cash.

shaintiques · Oct 8, 2013

I hear you, and I've operated that way for years, used one for my business, but hundreds of dollars in rewards is a stretch unless you are buying really large quantities of stuff for your business. 5000 points gets you a $25 check, so if I spend 5000 dollars I get $25 bucks back. It really isn't worth it to me. I'll never borrow money on a car again and plan to put such a large down payment down on a house that I won't have a problem getting a good rate, if we borrow at all. Also you can get cash back rewards options on debit cards now. And if it is a visa or mc debit card you are covered by those companies against fraud or theft. And it isn't that I am undisciplined, that hasn't been a problem for years, we are just trying to be free of the debt shackles and lead other people out of debt by doing so. Our class has over $300,000 dollars of debt, between 20 people. I know college students who have had to drop out of school because of credit card debt. Dave Ramsey says that we need to feel our money again, we don't feel it with a credit card.

sablebrush52 · Oct 8, 2013

Be VERY careful using a debit card. You do not have the same legal protections against loss, fraud, or theft that you have with credit cards. There is no $50 stop loss if your number and pin get hacked. There is no nothing and the linked account can get emptied in a nanosecond with no liability of any kind to the card's issuer.

mrjerke · Oct 8, 2013

Sable- Depends on the financial institution. Mine has the same Visa protection on debit an credit transactions.
And Shaine- there are plenty of 1% minimum cash back cards with no annual fee. I easily spend 20k a year on our bills/expenses.

wnghanglow · Oct 8, 2013

Congratulations to you! Getting rid of the credit cards is probably the hardest step in getting your finances straight. Keep at it!

latbomber · Oct 8, 2013

Congrats, such a good feeling and decision!

pipefish · Oct 8, 2013

Congrats, Shain! Wife and I have been debt free for six years (largely inspired by Dave Ramsey) but we still have a credit card for rental cars, hotels, and airplane tickets. We pay it off every month so we never, ever pay interest, and we like the security a card provides over cash when traveling. But, if you can make do without, even better!

pylorns · Oct 8, 2013

Congrats - we also follow Dave Ramsey and are debt free as well. I haven't gotten myself to cut-up the credit card just yet but that's coming.

txbeerboy · Oct 8, 2013

I went to a pipe shop in Houston and crabbed a dunhill pipe and other mess that cost to much money. I went to pay for it at the counter and discovered that you can only spend $500.00 a day with the debit card. I didn't know this at the moment

I don't carry a credit card but it isn't a bad idea if you are traveling.

brdavidson · Oct 8, 2013

Another option is a pre-paid credit card for online purchases. I have a pre-paid VISA that I use that offers all the protection of a regular VISA but without the debt. It's not connected to a bank account and if it somehow gets compromised its only exposed to what is on the card. Technically its not credit, I just move cash onto it if I want to purchase something. Think that might solve any of the credit card needed issues such as car rental, hotel bookings, online purchasing. Works for me.

mso489 · Oct 8, 2013

Congratulations! I have one credit card and I pay off the balance each and every month, if any. Credit

cards are a booby trap of interest rates, fees, credit rating coercion, and intimidation. There's a robo

call that pretends it is from your credit card company offering to fix your credit, so certain are they that

a high percent of card holders are in trouble. I've known any number of people, young and older

experienced adults, who have sunk into debt and spent years getting out, going bankrupt, and so on.

The lobbiests have carefully secured "legal" status for a great many financial loopholes for the card

companies that if negotiated by an individual in personally lending money would land them in jail for

decades. A bank or corporation does it, all fine and dandy. It is one of the great undermining degradations

of our civil society and a vast shame.

teufelhund · Oct 8, 2013

Congrats! I have a few thousand to go til I'm paid up. I'm really looking forward to it.

weezell · Oct 8, 2013

I keep one for emergency use only...

It is Official I Am Credit Card Free!

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