Dave Ramsey: babysteps

[Logan44551]

So thought I switch this over here. Me and the wife have had separate finances since we got together. My only debt was the mortgage. I knew she had some credit cards, but didn't know about balances and what not. Turns out there is considerable debt there. I just started listening to Dave Ramsey and am going gung ho about paying off these credit cards.

So plan is to suspend 401k contributions until I can pay these down. Starting step 2 today. I thought a thread may be cool to help motivate other members who are struggling with debt.

For those of you that have no idea who Dave Ramsey is, he has a podcast and a book called total money make over. I haven't read the book yet or attend the class that he has. The basic premise of the program is to be completely debt free. Step two you list all debt beside your mortgage littlest to biggest. You pay minimum payments on everything but littlest payment, and throw all extra money at the littlest debt. Then move on to the next debt.

There is also a online budgeting tool called every dollar, there is an app as well as a website. Anyhow I feel like I am rambling at this point. I first heard about Dave Ramsey from @gr8whitetrukker as well as @HIGHRISK.

So this thread is for anyone going through the steps or doesn't see a light at the end of the tunnel debt wise. I would encourage you to listen to the podcast it is really inspiring. Be forewarned he is pretty churchy

 

[puckhog]

Good post @Logan44551

Wife and I have been on the Dave Ramsey train for a few years now. No credit card debt. No car loans. We use cash or debit for everything. House will be paid off in 5 years and I am 41. So far so good.

Hopefully your thread will inspire some people to get their finances in order.

Good luck getting those CC out of your life. It is a huge relief, I promise.

 

[gr8whitetrukker]

So thought I switch this over here. Me and the wife have had separate finances since we got together. My only debt was the mortgage. I knew she had some credit cards, but didn't know about balances and what not. Turns out there is considerable debt there. I just started listening to Dave Ramsey and am going gung ho about paying off these credit cards.

So plan is to suspend 401k contributions until I can pay these down. Starting step 2 today. I thought a thread may be cool to help motivate other members who are struggling with debt.

For those of you that have no idea who Dave Ramsey is, he has a podcast and a book called total money make over. I haven't read the book yet or attend the class that he has. The basic premise of the program is to be completely debt free. Step two you list all debt beside your mortgage littlest to biggest. You pay minimum payments on everything but littlest payment, and throw all extra money at the littlest debt. Then move on to the next debt.

There is also a online budgeting tool called every dollar, there is an app as well as a website. Anyhow I feel like I am rambling at this point. I first heard about Dave Ramsey from @gr8whitetrukker as well as @HIGHRISK.

So this thread is for anyone going through the steps or doesn't see a light at the end of the tunnel debt wise. I would encourage you to listen to the podcast it is really inspiring. Be forewarned he is pretty churchy

Its pretty cool to throw cash down for BIG purchases. Thats the reward of living life financially secure. Live now like no one else so later you can live like no one else

It never occurred to me before what that meant. I know of some rich boys that look at me like a peasant when i paid for my showroom new '18 mustang GT with cash. It never occurred to me that rich and priviledged never knew what swallowed in debt feels like. Or struggle feels like. Could be any range of "rich" or "priviledged" from straight up just wealthy all the way to my parents own a business or paid for my college.

But to create that wealth using all that was in front of you the whole time is a priceless lesson i learned. Forever greatful to Dave.

 

[puckhog]

Cool story about Dave. Wife and I went to a seminar of his. It was jam packed. There were no seats left. He saw us sitting on the floor. He had one of his crew members come over to us and apologize that there were no seats. She took us to the merch room and literally gave us one of every single product Dave was selling. It was an incredible gesture. 3 bags full if books, cd’s, Envelope system, all of it.

 

[HIGHRISK]

So thought I switch this over here. Me and the wife have had separate finances since we got together. My only debt was the mortgage. I knew she had some credit cards, but didn't know about balances and what not. Turns out there is considerable debt there. I just started listening to Dave Ramsey and am going gung ho about paying off these credit cards.

So plan is to suspend 401k contributions until I can pay these down. Starting step 2 today. I thought a thread may be cool to help motivate other members who are struggling with debt.

For those of you that have no idea who Dave Ramsey is, he has a podcast and a book called total money make over. I haven't read the book yet or attend the class that he has. The basic premise of the program is to be completely debt free. Step two you list all debt beside your mortgage littlest to biggest. You pay minimum payments on everything but littlest payment, and throw all extra money at the littlest debt. Then move on to the next debt.

There is also a online budgeting tool called every dollar, there is an app as well as a website. Anyhow I feel like I am rambling at this point. I first heard about Dave Ramsey from @gr8whitetrukker as well as @HIGHRISK.

So this thread is for anyone going through the steps or doesn't see a light at the end of the tunnel debt wise. I would encourage you to listen to the podcast it is really inspiring. Be forewarned he is pretty churchy

I get so excited when I hear things like this!! Like Dave I’ve been very passionate about his program since I’ve begun. While I will admit I have not been on beans and rice doing it my discipline to paying off debt has been good.

I’ve turned 3 friends on to him and 2 of the 3 are succeeding fantastic! The other one wants to but doesn’t have the discipline and has excuses for why. But he’s trying and has definitely made progress.

Good post @Logan44551

Wife and I have been on the Dave Ramsey train for a few years now. No credit card debt. No car loans. We use cash or debit for everything. House will be paid off in 5 years and I am 41. So far so good.

Hopefully your thread will inspire some people to get their finances in order.

Good luck getting those CC out of your life. It is a huge relief, I promise.

Gods to hear about another person doing well! I have 3 credit cards for my business. Although he says get rid of all of them I’m just not comfortable handing out debt cards to my employees. I spend close to 200k a year in just fuel. So I pay off the balances every Thursday night when I do payroll. Not to mention I get 2% cash back so that’s good. It unlike most people I have the discipline to do so and never waver from that.

Its pretty cool to throw cash down for BIG purchases. Thats the reward of living life financially secure. Live now like no one else so later you can live like no one else

It never occurred to me before what that meant. I know of some rich boys that look at me like a peasant when i paid for my showroom new '18 mustang GT with cash. It never occurred to me that rich and priviledged never knew what swallowed in debt feels like. Or struggle feels like. Could be any range of "rich" or "priviledged" from straight up just wealthy all the way to my parents own a business or paid for my college.

But to create that wealth using all that was in front of you the whole time is a priceless lesson i learned. Forever greatful to Dave.

That’s because your a big baller lol! Congrats big guy I know you’ve been killing it by our conversations privately. Hope all is still going well.

It feels good that’s a fact! Most of you know I’m building a house and let me tell you it felt good throwing down the deed to my land to the bank plus a large sum of cash when we started the process. I’ve cash flowed every single penny for any upgrades or extras. Then when I close form construction loan to perm I’ll drop another huge chunk. Then my plan is 5 yrs or less (probably 3) it will be paid for!

Cool story about Dave. Wife and I went to a seminar of his. It was jam packed. There were no seats left. He saw us sitting on the floor. He had one of his crew members come over to us and apologize that there were no seats. She took us to the merch room and literally gave us one of every single product Dave was selling. It was an incredible gesture. 3 bags full if books, cd’s, Envelope system, all of it.

That’s awesome I’ve also went to one and same thing packed! Once you get to a certain point and everything is paid for and you have an emergency fund like Dave says (all though I like mine at 12 months not 6) things become an inconvenience rather than a problem. Imo 12 months I can fix anything 6 seems a little tight for me personally but mostly because my business leans heavy on the economy. My business is 100% debt free and has many times over enough cash to pay all my employees everything there owed god for bid I lost a major contract.

You see all these real estate guys online making big money by leveraging all there cash and borrowing from one rental to buy another. That’s good right now while the economy is on fire but they never account for risk like Dave says. I’m piling cash for when the economy take a a dip and homes drop in price and I’ll be scooping up some nice rentals for cash.

Glad to see all you guys doing well. Wealth is easy to obtain if you follow the rules. Like @gr8whitetrukker said. Live like no one else so later you can live like no one else.

 

[gr8whitetrukker]

I get so excited when I hear things like this!! Like Dave I’ve been very passionate about his program since I’ve begun. While I will admit I have not been on beans and rice doing it my discipline to paying off debt has been good.

I’ve turned 3 friends on to him and 2 of the 3 are succeeding fantastic! The other one wants to but doesn’t have the discipline and has excuses for why. But he’s trying and has definitely made progress.




Gods to hear about another person doing well! I have 3 credit cards for my business. Although he says get rid of all of them I’m just not comfortable handing out debt cards to my employees. I spend close to 200k a year in just fuel. So I pay off the balances every Thursday night when I do payroll. Not to mention I get 2% cash back so that’s good. It unlike most people I have the discipline to do so and never waver from that.



That’s because your a big baller lol! Congrats big guy I know you’ve been killing it by our conversations privately. Hope all is still going well.

It feels good that’s a fact! Most of you know I’m building a house and let me tell you it felt good throwing down the deed to my land to the bank plus a large sum of cash when we started the process. I’ve cash flowed every single penny for any upgrades or extras. Then when I close form construction loan to perm I’ll drop another huge chunk. Then my plan is 5 yrs or less (probably 3) it will be paid for!




That’s awesome I’ve also went to one and same thing packed! Once you get to a certain point and everything is paid for and you have an emergency fund like Dave says (all though I like mine at 12 months not 6) things become an inconvenience rather than a problem. Imo 12 months I can fix anything 6 seems a little tight for me personally but mostly because my business leans heavy on the economy. My business is 100% debt free and has many times over enough cash to pay all my employees everything there owed god for bid I lost a major contract.

You see all these real estate guys online making big money by leveraging all there cash and borrowing from one rental to buy another. That’s good right now while the economy is on fire but they never account for risk like Dave says. I’m piling cash for when the economy take a a dip and homes drop in price and I’ll be scooping up some nice rentals for cash.

Glad to see all you guys doing well. Wealth is easy to obtain if you follow the rules. Like @gr8whitetrukker said. Live like no one else so later you can live like no one else.

Youve been a big part of it thru your detailed pvt discussions weve had. Been a tremendous help big man!

 

[mp46]

Step 2 is fucked up, if you want to get out of debt the fastest way you don't arrange your debts by balance, you arrange them by interest rate. If you pay off debt by balance you're going look like you're paying things off because the number of bills reduces but you'll stay in debt longer.

The correct thing to do is arrange your debts by interest rate and pay the minimum on everything, then use all of the extra to pay off the highest interest rate first, regardless of balance. It's simple math and there are some websites out there that will help you structure your payments like this, you just enter all of your debt; balances, minimum payments, and interest rate and it will tell you which debts to tackle first.

So ignore Dave's step two if you want to get out of debt faster, follow him if you want to stay in debt longer but have a false idea of winning because you're reducing the number of envelopes you get a month.

 

[mp46]

Two other things, stop paying cash or using debit cards. First you have no consumer protections with cash/debit if you want to dispute a charge or someone hacks your card, the bank has your money and you're fucked until they decide to give it back. With a credit card your money isn't gone and there are laws that protect credit purchases that don't protect Debit(cash) purchases. A credit company is going to do whatever they can to figure out the problem because the credit card company is on the hook for the payment, and you can choose not to pay them until the dispute is finalized and you're out no money. Also, a credit card usually has points and/or cash back. Something simple like the capital one or discover double points card is 2% cash back on every purchase. Just pay the card off every month with the money you would have used on the debit card and you pay no interest. It's really that simple you collect cash back and have better consumer protections.

Lastly, stop putting money down on purchases and paying low interest shit off early. If you're at the point in life where you're paying 0-4% interest on things stop putting down payments on them or paying them off early. Most every stable investment is making around 4-6% interest so put your money there. Why take your money that's making 5% and pay off something that was financed at 3%? you just gave up 2% in gains. My truck was financed at 1.4% through the factory, why the fuck would I pay it off early when my basic investments are making 5.7% $50K at 1.4% for 60 month is $51.8K payed and $863 payment. Paying it off early with 140/mth would cost me $51,542 so I save a whole $258. I could put that into my investment account and get $1,257 in interest over that 5 years, so I could make $1,000 (1,257 earned minus 258 saved) more by not paying if off early. It's little shit like this that adds up over time and how you end up with 10s if not 100s of thousands of dollars more to do stuff with in your life.

 

[gr8whitetrukker]

Two other things, stop paying cash or using debit cards. First you have no consumer protections with cash/debit if you want to dispute a charge or someone hacks your card, the bank has your money and you're fucked until they decide to give it back. With a credit card your money isn't gone and there are laws that protect credit purchases that don't protect Debit(cash) purchases. A credit company is going to do whatever they can to figure out the problem because the credit card company is on the hook for the payment, and you can choose not to pay them until the dispute is finalized and you're out no money. Also, a credit card usually has points and/or cash back. Something simple like the capital one or discover double points card is 2% cash back on every purchase. Just pay the card off every month with the money you would have used on the debit card and you pay no interest. It's really that simple you collect cash back and have better consumer protections.

Lastly, stop putting money down on purchases and paying low interest shit off early. If you're at the point in life where you're paying 0-4% interest on things stop putting down payments on them or paying them off early. Most every stable investment is making around 4-6% interest so put your money there. Why take your money that's making 5% and pay off something that was financed at 3%? you just gave up 2% in gains. My truck was financed at 1.4% through the factory, why the fuck would I pay it off early when my basic investments are making 5.7% $50K at 1.4% for 60 month is $51.8K payed and $863 payment. Paying it off early with 140/mth would cost me $51,542 so I save a whole $258. I could put that into my investment account and get $1,257 in interest over that 5 years, so I could make $1,000 (1,257 earned minus 258 saved) more by not paying if off early. It's little shit like this that adds up over time and how you end up with 10s if not 100s of thousands of dollars more to do stuff with in your life.

The basic idea behind Ramseys criteria isnt revolutionary. Our grand parents paid cash for items. In todays world instant gratification for anything and everything gets ppl in to trouble. Just gotta budget the cost monthly. At $863/mth its $10356/yr thats not being saved because its now budgeted plus the interest paid however small or big. Then the snowball of effect of budgeted monthly income tends to create the need to budget other items as well. A majority of ppl (like i used to be) tend to spend money they dont have and get in trouble. A majority of ppl live paycheck to paycheck as a result. The govt says only only 32% of americans are contributing to important things like a retirement plan. And even less are contributing an effective amount toward retirement. How many ppl work for you or you know make an avg salary(35k/yr) and have a bitchin ride? A staggering amount IMO. Its not only vehicles but other things as well. Alot of ppl overspend and have an illusion of wealth but are stressed each and every month to pay bills. So thats really the idea behind his work. To try and reverse this staggering trend of irresponsible adults (like i used to be) who dont handle money well.

Its not only the avg income americans who do this. Ppl who make over 100k/yr often get caught up as well. Which seems ridiculous considering how much more income they have to play with. But the same basic mindset is at play here. Buy now pay later. Its the american way and everything companies do is designed to keep us in debt. And debt is slavery to the bank.

 

[mp46]

The basic idea behind Ramseys criteria isnt revolutionary. Our grand parents paid cash for items. In todays world instant gratification for anything and everything gets ppl in to trouble. Just gotta budget the cost monthly. At $863/mth its $10356/yr thats not being saved because its now budgeted plus the interest paid however small or big. Then the snowball of effect of budgeted monthly income tends to create the need to budget other items as well. A majority of ppl (like i used to be) tend to spend money they dont have and get in trouble. A majority of ppl live paycheck to paycheck as a result. The govt says only only 32% of americans are contributing to important things like a retirement plan. And even less are contributing an effective amount toward retirement. How many ppl work for you or you know make an avg salary(35k/yr) and have a bitchin ride? A staggering amount IMO. Its not only vehicles but other things as well. Alot of ppl overspend and have an illusion of wealth but are stressed each and every month to pay bills. So thats really the idea behind his work. To try and reverse this staggering trend of irresponsible adults (like i used to be) who dont handle money well.

Its not only the avg income americans who do this. Ppl who make over 100k/yr often get caught up as well. Which seems ridiculous considering how much more income they have to play with. But the same basic mindset is at play here. Buy now pay later. Its the american way and everything companies do is designed to keep us in debt. And debt is slavery to the bank.

Sure, if people aren't disciplined enough to understand money and interest then pay for everything in cash. But for those who are smart enough to not get caught up in it, it's life changing amounts of money saved. Because I run everything on credit I have a credit report and score that allow me to leverage even better rates against the bank. So while my vehicles and house are all below 4% I'll leverage that money I'm borrowing to earn more at 6-10%.

I now have about $900 a month profit in real estate income because I leveraged money like that for 10 years playing the banks. I only got the loan approval because of a few thousand dollars I had in those investment accounts that was saved up through credit card cash back and paying the minimum on secured debt (vehicles and such) and putting the rest in investments that earned more than the debt.

I know not everyone is disciplined enough to do that but there are others that don't even know strategies like this exist.

 

[HIGHRISK]

Youve been a big part of it thru your detailed pvt discussions weve had. Been a tremendous help big man!

Glad to hear that my friend! Next is to hire and get that mailbox money

 

[HIGHRISK]

Step 2 is fucked up, if you want to get out of debt the fastest way you don't arrange your debts by balance, you arrange them by interest rate. If you pay off debt by balance you're going look like you're paying things off because the number of bills reduces but you'll stay in debt longer.

The correct thing to do is arrange your debts by interest rate and pay the minimum on everything, then use all of the extra to pay off the highest interest rate first, regardless of balance. It's simple math and there are some websites out there that will help you structure your payments like this, you just enter all of your debt; balances, minimum payments, and interest rate and it will tell you which debts to tackle first.

So ignore Dave's step two if you want to get out of debt faster, follow him if you want to stay in debt longer but have a false idea of winning because you're reducing the number of envelopes you get a month.

Lol not true. It’s not about math if people in debt we’re good at math they would be in debt. It’s about the feeling of accomplishment in what your doing. It’s a mental play to keep you engaged and gazelle intense!

I’ve followed his plan and it works. I’m sure @gr8whitetrukker can attest to this also.

 

[HIGHRISK]

Two other things, stop paying cash or using debit cards. First you have no consumer protections with cash/debit if you want to dispute a charge or someone hacks your card, the bank has your money and you're fucked until they decide to give it back. With a credit card your money isn't gone and there are laws that protect credit purchases that don't protect Debit(cash) purchases. A credit company is going to do whatever they can to figure out the problem because the credit card company is on the hook for the payment, and you can choose not to pay them until the dispute is finalized and you're out no money. Also, a credit card usually has points and/or cash back. Something simple like the capital one or discover double points card is 2% cash back on every purchase. Just pay the card off every month with the money you would have used on the debit card and you pay no interest. It's really that simple you collect cash back and have better consumer protections.

Lastly, stop putting money down on purchases and paying low interest shit off early. If you're at the point in life where you're paying 0-4% interest on things stop putting down payments on them or paying them off early. Most every stable investment is making around 4-6% interest so put your money there. Why take your money that's making 5% and pay off something that was financed at 3%? you just gave up 2% in gains. My truck was financed at 1.4% through the factory, why the fuck would I pay it off early when my basic investments are making 5.7% $50K at 1.4% for 60 month is $51.8K payed and $863 payment. Paying it off early with 140/mth would cost me $51,542 so I save a whole $258. I could put that into my investment account and get $1,257 in interest over that 5 years, so I could make $1,000 (1,257 earned minus 258 saved) more by not paying if off early. It's little shit like this that adds up over time and how you end up with 10s if not 100s of thousands of dollars more to do stuff with in your life.

Your debt has a logo on the front right? Visa or MasterCard or something correct? It has the exact same insurance that a CC does. Don’t believe me ask your bank. Sure it might be a inconvenience because the money takes a few days or a week to be out back but it’s exactly the same. I’ve had my CC stolen as well as my debt card. Never once on either was I responsible for the fraudulent charges.

Ok so the cash back. Let’s just say somehow some way you spend 100k a year all on credit cards. Although I seriously doubt it. Your talking about 2k IF you pay it off without interest.

A more realistic situation is you spend about 1,500 a month on a CC. That’s $30 a month lol.


That second paragraph is in a perfect world where you have zero setbacks or emergencies. Your not taking into account risk. What happens if you lose your job? What happens if you get injured and can’t work? What if the economy take a shit and you get laid off or hours cut back? On paper your ideas might make sense but the Millions of people that his program has helped can’t all be wrong lol.

 

[HIGHRISK]

The basic idea behind Ramseys criteria isnt revolutionary. Our grand parents paid cash for items. In todays world instant gratification for anything and everything gets ppl in to trouble. Just gotta budget the cost monthly. At $863/mth its $10356/yr thats not being saved because its now budgeted plus the interest paid however small or big. Then the snowball of effect of budgeted monthly income tends to create the need to budget other items as well. A majority of ppl (like i used to be) tend to spend money they dont have and get in trouble. A majority of ppl live paycheck to paycheck as a result. The govt says only only 32% of americans are contributing to important things like a retirement plan. And even less are contributing an effective amount toward retirement. How many ppl work for you or you know make an avg salary(35k/yr) and have a bitchin ride? A staggering amount IMO. Its not only vehicles but other things as well. Alot of ppl overspend and have an illusion of wealth but are stressed each and every month to pay bills. So thats really the idea behind his work. To try and reverse this staggering trend of irresponsible adults (like i used to be) who dont handle money well.

Its not only the avg income americans who do this. Ppl who make over 100k/yr often get caught up as well. Which seems ridiculous considering how much more income they have to play with. But the same basic mindset is at play here. Buy now pay later. Its the american way and everything companies do is designed to keep us in debt. And debt is slavery to the bank.

What’s in your wallet? Lol

People just can’t figure out why you see all these CC commercials “giving away” cash back or points lol. You can finance furniture for up to 84 months!!!! Campers,pools,boats for 15 years!

I too was like you. I had payments on everything and made them monthly no problems. That’s is until I had a problem and lost everything.

 

[gr8whitetrukker]

What’s in your wallet? Lol

People just can’t figure out why you see all these CC commercials “giving away” cash back or points lol. You can finance furniture for up to 84 months!!!! Campers,pools,boats for 15 years!

I too was like you. I had payments on everything and made them monthly no problems. That’s is until I had a problem and lost everything.

Yeah its a harsh reminder ya dont own shit if you miss a payment. The bank does and they dont play. Even worse with a house. Can have the deed paid but dont pay your taxes theyll auction it off to get their cut.

 

[mp46]

So people need to pay of small balances first instead high interest rates because they don’t have the discipline that’s fine. But that doesn’t mean it’s the fastest way out of debt, do what you need to do, but it’s not the fastest way. I was almost 30-40k in debt some years back and I turned myself around, went from jobless and racking up credit cards so I had cash on hand to debt free aside from the house. (Well now I’ve added the car and truck but that wasn’t a requirement, it was a want.)

and for the same people struggling to get out of debt, that money missing from a debit transaction could make or break paying the bills while a CC would allow them to float it and a that $30 a month from cash back would be $360 a year for a struggling family, that’s a car payment or a doctors visit

We’re all adults and can make our own decisions. If you feel staying in debt longer so you can “earn the little wins” paying off smaller bills first works for you than do it. It’s just like diet and training, the program you’re on might not be the best but if it’s the one that keeps you on track then stick with it, even if it takes you longer to reach your goal.

 

[HIGHRISK]

So people need to pay of small balances first instead high interest rates because they don’t have the discipline that’s fine. But that doesn’t mean it’s the fastest way out of debt, do what you need to do, but it’s not the fastest way. I was almost 30-40k in debt some years back and I turned myself around, went from jobless and racking up credit cards so I had cash on hand to debt free aside from the house. (Well now I’ve added the car and truck but that wasn’t a requirement, it was a want.)

and for the same people struggling to get out of debt, that money missing from a debit transaction could make or break paying the bills while a CC would allow them to float it and a that $30 a month from cash back would be $360 a year for a struggling family, that’s a car payment or a doctors visit

We’re all adults and can make our own decisions. If you feel staying in debt longer so you can “earn the little wins” paying off smaller bills first works for you than do it. It’s just like diet and training, the program you’re on might not be the best but if it’s the one that keeps you on track then stick with it, even if it takes you longer to reach your goal.

Sounds like you did good getting out of debt.
So you went back into debt with 2 car payments? Or you paid cash for those 2?

If $360 a year (.98) a day will really make a difference in someone’s finances they have WAY bigger problems.

I don’t think you’re looking at the big picture or process. What do you think the difference between the highest interest rate and lowest someone might have? 5 maybe 10%? Or enough to make a difference in the long run.

Guess we will just agree to disagree. I’ve done it and so have millions of others. So kinda hard for you to have a leg to stand on arguing it doesn’t work.

 

[mp46]

Sounds like you did good getting out of debt.
So you went back into debt with 2 car payments? Or you paid cash for those 2?

If $360 a year (.98) a day will really make a difference in someone’s finances they have WAY bigger problems.

I don’t think you’re looking at the big picture or process. What do you think the difference between the highest interest rate and lowest someone might have? 5 maybe 10%? Or enough to make a difference in the long run.

Guess we will just agree to disagree. I’ve done it and so have millions of others. So kinda hard for you to have a leg to stand on arguing it doesn’t work.

Back in debt, why spend money at 6% when I can borrow it at 1.4 and 2.5% it makes no sense to stop contributing to investments making 6% when just so I can not spend 2.5% I'm giving up 3.5% just to say I'm not in debt. If those investments ever dip below 2.5 then I'll stop investing and shuffle the money toward the truck or houe or whatever.

There are millions of people where $360 makes a huge difference in an emergency. Or it could pay for a cycle, all for the price of changing nothing, just swap a card that says debit for one that says credit. It's really that easy. Hell a family that is under crushing debit would appreciate any money that comes their way.

And I am looking at the big picture the difference in interest rates doesn't matter, the fact is there are different interest rates, that's what matters. If you need to kid yourself and think paying stuff off slower is the right way to go because it reduces the numbers of accounts then go for it. But it doesn't change the fact that it's still the slowest way to pay it off, there's plenty of calculators online that show the differences. You're an adult, do what you want, just don't think it's the fastest way out of debt.

 

[Sworder]

People who use credit cards don't know how to manage their money.

It's a great business idea to give people whom are bad with money credit cards. $$$

 

[$BlackBeard]

People who use credit cards don't know how to manage their money.

Not true. I can fix this sentence - "Most people who use credit cards don't know how to manage their money".

The really smart ones use credit for everything they can.

Simple example: you the reader and me go to buy a TV for $500. You pay cash and I use a credit card. You have $500 less to spend but now have a TV. Your opportunity cost amounts to $5/year at 1% interest. That is what you gave up to get the TV. I paid for it with a credit card: I also paid $500, but my credit card pays me back 2% on this purchase. I acquire the TV for a NET amount of $490. The opportunity cost for me is also $5/year at 1%. So, I purchase the same product at a 1% discount because I used a credit card.

The smart part comes in here - I use the miles, cash back, rewards, etc offered to me by the credit card company to my advantage by paying off the card in full each month.

The more younger people can do this, the better off they will be. Not for saving $5 on a TV purchase, but by savings hundreds/thousands on a car/home purchase by having excellent credit.