by Penny Millirans  at February 08 2010 9:53 AM

I read your book: The Total Money Makeover. I am starting your snowball effect on my credit cards. My mom heard that is is bad on your credit score and credit report to close credit accounts. When the cards are paid off, do I just cut up the cards or call to have the account closed?

by Joleen  at January 31 2010 11:29 PM

we asked for a lower payoff of a credit card and were told that if we take a lower payoff amount they would list it on our credit report as an R9. even though we have never had a late payment. is there a way around this or should we just pay the balance owing.

by Adam  at January 31 2010 3:57 PM

I don't disagree with very much of this. Unfortunately, Mr. Ramsey neglects to mention how without a credit score - any kind of credit score at all - one is unable access some basic services and utilities. Natural gas is one example, as I learned the hard way one winter: After spending several frigid nights without heat, I was finally able to start gas service at my apartment by signing up under the name of a family member who had a credit rating. Furthermore, the statement "You will spend more if you use credit cards" is a notion easily disproved. Empirical evidence indicates that it is possible to use a credit card to pay for a single purchase one would need to make with or without said card - gas for one's vehicle, for example - and pay off the balance at the end of the month (or sooner). In a perfect world, of course, those of us who find foolhardy the practice of borrowing money instantaneously for any purchase, be they necessary ones or those made with frivolity, would be celebrated for our personal fiscal responsibility. As last year's bailout demonstrates, however, the world we live in is driven, and in large part controlled by, powerful organizations like banks - you know, the guys making money off the credit cards. It's like being a slave, sort of.

by Deana  at January 30 2010 9:48 PM

We signed up for a Upromise Credit Card 8 years ago, charge EVERYTHING on it, pay it off in full EVERY month and have earned $1900 in which we were able to Cash out instead of choosing one of their 529 plans and invested it in a ROTH IRA. We watch what we spend because we know we have to pay in full when the bill comes in. Never paid interest on a credit card in 25 years! :)

by Andrew  at January 25 2010 11:20 PM

Well my question that I have: since the banks have gotten the bailout and from what I understand is that many of the banks aren't going to repay the bailouts, so shouldn't CC holders then not pay their cards back?

by David Allain  at January 21 2010 1:39 PM

I was wondering what Dave thinks about Wal-marts pre-paid credit cards.

by dennis  at January 13 2010 4:42 PM

hey Mr DAVE ,been in business 11 years now and built up the buisness with credit cards , $200.000 in credit debt and all current , by the mercies of God,but the buisness slowed down a bit , and gettin harder to pay , i see all these company.s willin to help with credit card debt , so many out there is any of them for real ? i kinda look at it like some one went to dental school , they graduate and have 200K student loans , any reconmendations i can do instead of bank rupt,

by Brian  at January 12 2010 6:07 PM

I have never owned a credit card but sadly enough I have a poor credit standing. I ran into trouble with several checking accounts which subsequently placed me into chex systems. I have worked diligently paying these debts off. Now the problem is 7 years of not being able to open a checking account. In addition it will stay on my credit. I would really like someone to tell me if a secured credit card with reasonable fees is a good way to begin to re-build credit as well as give me spending power because as I stated I won't be able to open a checking account for quite a few years? Please help if you can.

by Robert Davidson  at January 02 2010 10:04 AM

I am 72 years old, retired and have been married to the same wife for 50 years and have no debt. We have had trouble with Master Credit card making their own mistakes and causing us to many phone discussions to straighten out the mess. Now my wife and I are having a discussion about the merits of a different cred card application, Visa, or going to use of our debit card instead. Is the debit card safer to use when there is a disputed charge or should we go back to another credit card?

by Gordon Brown  at December 22 2009 6:56 AM

What about everybody taking all the credit cards and cash them and not paying ? How much time you think the companies will chase everybody after going broke ? If everybody will have the bad credit how CC companies will exist ?

by Christine  at December 09 2009 1:00 PM

Chase Card Services charged me finance charges on a closed account and the APR was increased from 12.22 to 44.45%! I called them and they assured me that it would be removed in 24 hours. I got a personal loan from Pentagon Federal Credit Union for 8.99% and used that to pay off the Chase Card. Credit unions are the way to go.

by Patrick  at December 07 2009 9:35 PM

The other problem with Rewards Cards is that the retailer's fee for processing is often double or more of a regular credit card, which means that when you use the Rewards Card, you're basically either causing the retailer to raise prices for everybody else, or enriching yourself from the retailer's pocket. This is the unseen side of Rewards Cards that most people just aren't aware of; and the credit card processors don't hand on all the additional fee to you, of course - they are lining their pockets as well! Another sneaky practice is that the credit card processors raise their rates about once a year, and if the retailer doesn't ask for a rate review, the rates creep up over time - so the retailer is out even more money for letting you use a charge card! Debit cards have substantially lower fees.

by Kim  at December 05 2009 4:43 PM

Maureen, Citibank is now closing my account on 12/31/09 due to inactivity. I tend to use my Wells Fargo credit card and pay it off each month. My guess is they are purging the accounts with less activity to reduce their account balances over time.. not sure.. but I'm interested in the reason. Now, with all of the companies increasing rates, I'm starting to question if I want to use a credit card on a regular basis like I have been. I'm leaning towards using cash instead. Thanks for the article.

by Maureen  at November 24 2009 6:35 PM

I heard that credit card companies are closing accounts when they get to zero balance. Is this true? How much does that hurt your credit rating?

by CT  at November 17 2009 4:49 PM

Dave, I'm a married 44 year old male with two kids and $0.00 debt. House, cars all paid for. We use debit cards, but have considered getting a credit card as I understand they have better protection as it relates to stolen identity. I have not had a credit card in 10 + years, but when I did, I never carried a balance. After reading a few of your articles...i think i'll just keep the debit card. Thanks for everything.

by Erin Lamb  at November 15 2009 5:54 PM

I do agree with about 90% of what your saying. people do ignore the obvious truth that when you get into carrying a loan around in your pocket your purchases are less thought out. It would be a great idea to stay away from credit cards 100%, but not all uses of a credit card are naive. If say you have an emergency credit card you rarely ever use, and never made frivolous purchases it would be a good thing and a minor safety net for week periods of your income. I understand you are saying almost no one can do that, and I believe you, but if someone could willfully use a credit card with responsibility it would not always be a bad thing, sometimes a good thing. I enjoyed reading your article. Thank You.

by Meg  at November 12 2009 4:51 PM

"NO positive side to credit card use"? Come, now. Of course there is. I see three main positive sides to it: 1. It helps you build credit. 2. Using credit allows you to delay payment for up to a month. The means you can put the cash you would have otherwise used in a savings account during that month, where it can gain interest. Then pay off your credit card bill in full at the end of the month, and keep the interest for yourself. 2. Reward points are great, and they come in all forms - not just car rebates. It's effectively money you would not have had if you had paid in cash. Can credit cards be misused to great detriment? Is credit card debt bad? Absolutely! But it's specious to say there is no such thing as positive or responsible use.

by Jessica  at November 08 2009 3:49 PM

Is it better to cancel a credit card after paid off or just keep it with a zero balance?

by Ann  at November 01 2009 7:02 PM

Thanks Dave for all the good advice. I sent many articles to my children.

by Andrea  at September 30 2009 11:42 PM

I love getting coupons and promotions through the mail because of my credit card. For example I get a free pair of panties every month from victoria secret because I am a card holder. Sometimes that does influence me to buy more, but I always pay off the transaction at the same register at the same time that I used the card, so I feel like I'm paying cash anyway. I am very careful of my credit habits because of what I've seen my parents go through. I hope I'm not making some big mistakes!