Many personal finance experts speak out against using credit cards. Dave Ramsey, for instance, takes an extreme view against any debt. In one blog post, RamseySolutions.com stated, “Life is better without credit cards.” The post asserted that people don’t need even one credit card if they build emergency savings and pay cash for everything.
Likewise, billionaire investor Mark Cuban agreed with Ramsey on an episode of The Ramsey Show. “If you use your credit cards, you do not want to be rich,” he said on the podcast. “That’s my favorite line; I tell it to people all the time.”
Roughly a decade ago, Cuban said he wished he had known the evils of credit card debt in his 20s. “I should have paid off my cards every 30 days,” he said in a Business Insider interview in 2014.
He pointed to high-interest charges thatcan keep you from building wealth. He has also said that the best financial investment you can make, at first, is to pay off your credit card debt. “Your credit card, you know what your return is,” he told Ramsey. “If you’re paying 15%, 20% interest, if you pay that down, you just earned 15% or 20%.”
Are Cuban and Ramsey Right About Credit Cards?
Conventional financial wisdom often touts the benefits of a high credit score, which you can only build by using credit responsibly.
“For many average Americans, buying a home is a major part of their wealth building plans, and not being able to establish a credit history will make it harder to get good rates,” Colin Palfrey, chief marketing officer at Crediful, previously told GOBankingRates.com.
But more than building your credit profile, which can lead to benefits like more affordable mortgage rates, using credit cards responsibly can help shift your money mindset, according to experts.
Matt Bruce, CFP®, AIF®, president of the Pointer Financial Group, previously told GOBankingRates that learning to manage credit responsibly can help build financial discipline. “I’ve never worked with a wealthy client who didn’t use credit cards responsibly. It’s not that using or not using a credit card that builds wealth, it’s that the ability to responsibly use credit is a determining factor in the ability to generate wealth,” he said.
The Secret to Building Wealth, Per Cuban
Financial experts agree that Cuban is right on at least one point: You should always pay your credit card balance in full before interest accrues.
Once your credit cards are paid off, you can deposit that money into a high-yield savings account, where you will have easy access in an emergency and earn a return on your investment.
Spend more than you earn and then put your money in an account that will work for you, building wealth as interest compounds.
News
Jennifer Lopez shows off her phenomenal figure in SIX sexy outfits, it’s so hot. Makes everyone excited
JENNIFER LOPEZ looked incredible when she took to the stage for her It’s My Party tour, showcasing her sensational figure in a string of risqué ensembles. Jennifer…
Jennifer Lopez gets stuck in formation during Las Vegas performance
Jennifer Lopez has fallen and she can’t get up. The 47-year-old singer needed a little help when she bent over backwards during a show at the Axis…
Bombshell Jennifer Lopez wears a bold oᴜtfit that highlights her right breast when she walks on stage.
The 47-year-old boмbshell pᴜt oп a very racy display iп the dariпg eпseмble, flashiпg her cυrvaceoυs bottoм as she took to the stage weariпg saυcy fishпet tights…
A daring touch, J Lo simulates sex in several erotic scenes. Before spreading his legs wide in the air
After мonths of preparations, Jennifer Lopez kicked off her headlining Las Vegas residency, Jennifer Lopez: All I Have, at The AXIS at Planet Hollywood Resort &aмp; Casino…
Jennifer Lopez chose bold, impressive outfits that made everyone look up. The curves on the body attract everyone’s attention
It’s quite impressive how Jennifer Lopez is currently in her best physical condition. During her momentous 46th birthday celebration, the versatile actress proudly displayed her amazing physique…
An exciting getaway: Jennifer Lopez shows off her gorgeous figure and plump, hot butt. Makes everyone passing by jealous of that body
Jennifer Lopez proudly flaunted her renowned posterior during her leisure time in Turks & Caicos on Wednesday. Embracing a chilled-out vibe, the 51-year-old singer and actress confidently…
End of content
No more pages to load