Why does Dave Ramsey say you don't need a credit score? (2024)

Why does Dave Ramsey say you don't need a credit score?

According to Ramsey, a credit score is really an "I love debt" score. He's against credit scores because he believes they're tied to being in debt. To make his point, he shares misleading information about what goes into a credit score, with the names of the scoring criteria conveniently changed.

Why does Dave Ramsey say not to get a credit card?

Money expert Dave Ramsey tweeted this sentiment along with a video sharing how excessive credit card use keeps you from building wealth. Ramsey said the millionaires he's spoken to over the years didn't break through financially because of their credit card points.

Do you actually need a credit score?

Having no credit score makes it more difficult to access financing for anything from a cellphone to a car or home. Even if you don't plan to borrow money in the near future, having a good credit score can still make life easier in a number of ways: Get access to favorable credit terms.

Is impossible to get a mortgage without a credit score Ramsey?

While getting a mortgage without a credit score requires more paperwork, it's not impossible. You just need to find a “no credit mortgage lender” who is willing to do something called manual underwriting—like our friends at Churchill Mortgage.

Does Dave Ramsey care about credit score?

Ramsey's credit score doesn't matter -- but yours does

Since Ramsey doesn't borrow, he won't be able to do that. And, for the finance guru, it's just fine not to have a credit score. Ramsey has a substantial net worth (much larger than most people have), so buying houses or cars with cash isn't a hardship for him.

What is Dave Ramsey's opinion of credit scores?

"Don't look at a credit score to determine how well you're doing with money." As he elaborates, his statements get more definitive. "A FICO score has NOTHING to do with success, it only highlights how much you borrow money and pay it back."

Why Ramsey is wrong about credit cards?

One of the main reasons Ramsey is wrong in suggesting you shouldn't have any credit cards is because cards help you build credit. A good credit score is a very important financial asset. With good credit, you can more easily get an affordable mortgage loan so you can buy a home and begin building equity.

Does Dave Ramsey believe in good debt?


What does Warren Buffett think about credit cards?

Because they pave the way for high-interest debt accumulation, investing mogul and billionaire Warren Buffett is generally against credit cards and advocates for spending in cash as much as possible.

Is it better to have bad credit or no credit?

Having no credit is better than having bad credit, though both can hold you back. Bad credit shows potential lenders a negative track record of managing credit. Meanwhile, no credit means lenders can't tell how you'll handle repaying debts because you don't have much experience.

Can you live a good life with bad credit?

Living well without credit is certainly possible. We'll be straightforward here: Many things in life are much easier when you have a good credit score. But lacking a credit score doesn't mean you'll be forced to go live in the woods. You can theoretically live your life without having any credit to your name.

Can I survive without credit card?

Bottom Line. It's definitely possible to survive without a credit card. Whether you prefer to use cash, your debit card or a combination of other strategies, there are solid work-arounds. However, having a credit card on hand for emergencies for those difficult-to-navigate purchases may be worth considering.

Has anyone got a mortgage with bad credit?

Getting a mortgage with bad credit is possible, but it can be harder. Lenders will look at the credit score of people who apply for a mortgage. They use your credit history as an indication of how likely you are to make repayments and how well you'll manage your account.

Can you buy a house without a FICO score?

The short answer is yes, you can buy a house without credit — but it's a little less straightforward than purchasing a home with an established credit history. One option is making a cash offer, though this requires significant cash reserves that most people may not have access to.

Do millionaires have credit scores?

Since income is not one of the five factors that determine a credit score, the wealthy are just as likely to have a low credit score as the people with lower income. The rich can miss payments, rely too heavily on credit, and open too many new accounts, all of which may lower their credit score.

What is a good credit score for my age?

Average Credit Scores FAQs

Consider yourself in “good” shape if your credit score is above the average for people in your age group. Given that the average credit score for people aged 18 to 25 is 679, a score between 679 and 687 (the average for people aged 26 to 41) could be considered “good”.

Do millionaires care about credit scores?

Chasing a Credit Score is a Poor Person's Game

Wealthy people are less likely to rely on credit, using it as a tool rather than a lifeline. The richest people don't worry about their FICO score because, for them, debt is an option rather than a necessity.

What lender does Dave Ramsey recommend?

That's right—RamseyTrusted. And it's a big deal. It means that Churchill Mortgage is the only mortgage provider trusted by real estate expert Dave Ramsey and the Ramsey team.

What is the best Dave Ramsey book to get out of debt?

The Total Money Makeover: Classic Edition: A Proven Plan for Financial Fitness: Ramsey, Dave: 9781595555274: Amazon.com: Books.

What is a good credit score to buy a house?

A 620 credit score is typically what you'll need to get a mortgage for a home purchase. Although you can buy a house with a credit score as low as 500, you'll pay a higher rate and make a larger down payment.

Why is a debit card the worst financial tool?

A debit card doesn't offer the same fraud protection

"With a debit card, your personal funds are gone, and you must work to get those back," Harrison says. "Depending on when you report the missing card or fraud, you could potentially be liable for the entire amount.

How many credit cards is not good?

It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.

Why are there some things not worth putting on your credit card?

Going over your credit card limit or missing payments can put you into financial difficulties and cause extra interest charges or late fees. Paying household items on credit cards such as groceries, personal care items or cleaning supplies is also not the best idea.

How billionaires use debt to stay rich?

How do billionaires live off loans? By pledging their appreciating assets as collateral, billionaires are able to live off their loans as long as their loan payments don't exceed their investment gains.

What is a millionaire's best friend?

One awesome thing that you can take advantage of is compound interest. It may sound like an intimidating term, but it really isn't once you know what it means. Here's a little secret: compound interest is a millionaire's best friend. It's really free money.

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