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Dave Ramsey is Wrong About Credit Cards

dave ramsey is wrong about credit cardsHave you heard of Dave Ramsey? I greatly respect the man and what he has done in America in the past decade, but you may be surprised that I do not agree with what he teaches about credit cards. Dave Ramsey has a very simple view when it comes to credit. He wants you to pay them off and cut them up, never to use them ever again. I say that Dave Ramsey is wrong about credit cards.

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Where Dave Has It Right

Our world has grown accustomed to instant gratification and has financed much of their possessions. This has increased the popularity of credit cards and has made Visa and Mastercard very wealthy companies. For those that cannot control their spending, Dave Ramsey is right. They should not have credit cards. It’s better to live a simple, safe life on a debit card than to live every day in debt and getting sunk with interest payments.

Related: Everything You Need to Know About Credit Cards in 2 Minutes

Where Dave Has It Wrong

I have been a loyal student of Dave Ramsey’s for the past 3 years or so. In that time, I have increased my net worth by over $100,000, largely because of what I have learned from Dave. Just recently though, I have been reviewing some of the principles that I have learned, and I am beginning to disagree with Dave in regards to credit.

Here are four reasons why I think everyone should have multiple credit cards and use them regularly.

1) Security

Have you ever had someone charge something on your debit card without your permission? Somehow they got your number and made a fraudulent charge either by phone or online. Depending on your bank, it could be a nightmare to get that money back. If, however, you often use a credit card, you simply tell your credit company that it wasn’t your charge and refuse to pay the bill. Money never comes out of your account and the responsibility is wholly on the credit card agency.

Related: Credit Cards for Good or Excellent Credit

2) Introductory Rewards

Credit companies want your business and are willing to give you a little incentive to have you sign on with them (because they want to charge you interest of course, but you’re going to pay your bill every month right??). I just received a credit card offer in the mail last week. If I spend just $500 in the first three months (I am going to spend well over this amount in tuition anyway), I will earn 20,000 points, which will give me $200 in gift cards. By choosing gas gift cards, I could go about a month and a half without having to pay for gas in my Honda Civic. Sounds like a great deal to me!

3) Continuing Reward Points

This card has no annual fees and it offers rewards points on each purchase, which can then be used for more gift cards. If I continue to stick to my budget and pay my credit card off each week, these reward points are a clear benefit with absolutely no downside.

4) Improving Your Credit

If you never own a credit card, you might not build enough credit to qualify for a home loan, and you might even be turned down for a job when your interviewer checks your credit rating. Whether you like it or not, credit is important and it’s best if you have a couple of open lines and pay them off regularly.

What do you think? Is Dave Ramsey wrong about credit cards? Or do you think it’s an inevitable disaster waiting to happen?



My name is Derek, and I have my Bachelors Degree in Finance from Grand Valley State University. After graduation, I was not able to find a job that fully utilized my degree, but I still had a passion for Finance! So, I decided to focus my passion in the stock market. I studied Cash Flows, Balance Sheets, and Income Statements, put some money into the market and saw a good return on my investment. As satisfying as this was, I still felt that something was missing. I have a passion for Finance, but I also have a passion for people. If you have a willingness to learn, I will continue to teach.


  1. I always talk about being somewhere in the middle. This is especially true for my clients who have abused credit in the past.

    I like the idea of doing a “credit fast” where you get back to the basics and fall in love with your money all over again. As you mentioned, it’s just so easy to spend these days. I tell them to start tracking their spending more closely so they know where their money is going.

    Once this appreciation for money is regained, you can easily (and slowly) add credit cards back into your life for the reasons you specified. I personally did this myself. My wife and I stopped using credit for about 2 years. Now, we use it more responsibly.

    All that being said, I do understand where Ramsey is coming from. He has his opinion and will defend it to no end. I respect that.

    Have a great holiday weekend!

    • I definitely with you Adam. Sound like we are very much in line. When I found out that my credit score was negatively affected by having too few open lines of credit, I decided to use my card more (responsibly of course). Along with that, I can benefit from more reward points.

  2. I think I agree, as long as you can curb your need for instant gratification! We have 2 credit cards, simply for rewards. I have used them to pay for my classes, home renovations, even for tithing and in doing so have gotten TONS of points toward gift cards…we just commit to paying it off every month or so! 🙂

    • Yep! Sounds like you are using it perfectly Rachel! Nice job!

  3. It really is a good thing to own one but being responsible when you have a credit card can be hard for others. But for those savvy individual having a credit card, it can be a great benefit to them.

    • That’s is true, Mark. It’s okay to have one but you have to make sure you know your responsibilities as an owner.

      • Yep. You can’t let yourself get carried away with a credit card, and it can be so easy to do!

    • I definitely agree. Thanks for the comment!

  4. Another reason he says not to have them is that we generally spend more with plastic since its harder to part from a $20 or $50 bill. That makes sense too. As you know, Ramsey helped us pay off student loans in 9 months and reach other big financial goals so I’m thankful for the simple wisdom he offers. We do have a credit card but we don’t carry a balance and it bought us a round trip ticket from calgary to Nashville for $40 from reward points!

    • Theme for be comment Jessica. Do you think people spend more with a credit card than with a debit card though? I wouldn’t think it would make that much difference. Sounds like you’re using your card wisely. Nice work!

  5. Depends who you are, but think about this: Dave Ramsey would not be popular if people had not abused credit cards and debt. The evidence is clear. Also, I don’t know many millionaires who made there money by using credit cards (Dave’s line).

    • True. Millionaires aren’t made by a few hundred dollars in rebates, but it can’t hurt! What if that money is invested? It might turn into a million bucks someday! 😉

  6. Thank You! I have respect for the program that Dave Ramsey presents and the thousands of people he has helped but this is one area where he has it wrong. Over the course of the past year, we generated nearly $1600 in credit card rewards. That basically income! As long as you have a modicum of self-control, you can’t afford not to use credit cards!

    • Hat is a crazy amount of rebate money. I sure hope you’re not overspending!

  7. I totally agree with you, I think credit cards should be leveraged to get the points or free groceries, gas, trips etc. People just need to control their spending with credit cards and only use with the intention to pay it off with in a week. Use it weekly for gas and groceries instead of paying cash and reap the rewards. Be smarter than credit card companies, and make sure the card is a no-fee card and you’re good to go.

    • Dave has a stat about people spending 18% more when they use a credit card, but strangely enough, no one can find this report anywhere. I think it’s definitely true for some, but not all.

  8. Agree 100%. The argument you make about debit card fraud is the biggest reason I disagree with Ramsey on credit cards. I don’t listen to him anymore, but when I did, he completely dismissed this as something that could happen. He made it seem as if you could get your money back in your account as quickly as a credit card.

    You’re right. Doesn’t work that way.

    But for the wrong person, like someone prone to overspending, multiple credit cards is a disaster waiting to happen. I’ve never heard Ramsey make that statement though. He blanketly disapproves of credit cards for everyone.

    • Yep, I’ve heard the same thing. I think 95% of people probably shouldn’t have them, but for us responsible people, we can definitely benefit from the other’s mistakes!

  9. I disagree with you because what Dave Ramsey teaches is for the masses. What you do works for you and that is great but his advice to stop using credit cards it targeted to individuals that have thousands of dollars in debt and cannot control their spending. Once you get rid of your cards one is forced to get their act straight. Dave Ramsey’s programs are not for people like you that are happy with their financial situations. His programs are for those that have struggled and need help.

    • Great point Kevin, and thanks for the comment! However, Dave himself still doesn’t use credit cards, and I think he’s leaving money on the table.

  10. To answer your question as to whether owning a credit card is “smart” or a “disaster”, I think it depends on the person – if he/she knows how to use it properly, then it’s “smart”.

    • It can definitely be tough to use a credit card properly, especially with rising credit limits and friends buying more and more toys on credit. Using it correctly can be a huge positive though. 🙂

  11. Credit cards are only a disaster if you’re not able to use them responsibly. We pay off ours every month, use one main card for most monthly expenses, and we reap big rewards for just paying our bills. Our Chase card rewards are pretty generous, and we can use the points to get cash or to shop on Amazon. I’d be throwing money away if I didn’t use a credit card.

    • Hi skrpune! Thanks again for a great comment. Also, you might want to look into getting another card if you want to raise your credit score. I found out that I have too few lines of credit and my credit was affected negatively from it.

  12. I agree that credit cards can be a huge plus for your finances. I have been churning credit cards and have managed to earn about $500 in rewards. That’s money I made/saved by doing nothing but paying my bills. You do have to be very disciplined not to let a month slip by and get yourself dinged with interest. That will wipe out any cash back reward really quickly

    • You’ve got it micro! If you use your card right, it can be a huge help to your finances!

  13. My dad is retired so he does a fair amount of traveling. He will sign up for certain credit cards that offer 20,000 flyer miles, once he redeems the miles, and pays $5-10 for a flight, he cancels the card. He has traveled around the world over the past few years and has spent under $500 total! That’s less than the cost of most one way tickets.

    • That’s awesome! It’s nice to hear some people taking advantage of these offers instead of racking up big debt and paying interest!

  14. I cut up my credit card like Dave Ramsey says and am personally glad that I did. Yes, I gave up some rewards but I feel MUCH less stress now. I see what you mean though and I struggled with the decision for awhile at first.

    • I cut mine up too Monica, but now that I’m debt free and I know that I’ll never get into debt again, I’m comfortable having one. I know that I’ll be responsible with it, so why not use it for a few extra rewards?

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