Could Dave Ramsey and Dave Ramsey’s organization be wrong about credit cards? If they are wrong, what are they wrong about?

Let’s take a look at that right now. One of the basic premises of the Dave Ramsey organization training is to work with cash only. No credit cards, no credit accounts, only cash.

Well, is that the right thing for you?

Let’s explore why going cash only no credit cards might not be the best thing for you right now in our current economic environment.


If you are coming from a place of credit where credit has harmed your life, where it has taken a toll on your marriage, taken a toll on your family, and has caused you pain. I have four steps for you.

Step one.

Eliminate all shame and all guilt for what has happened to you in the past.

Choices you’ve made, mistakes you’ve made, lies that you’ve believed. Get rid of all the shame and the guilt and start new.

Step two.

Consider this a reboot.

Happy girl

Every organization, every family, every ministry at some point needs to have a fresh start, needs to have a way to get to the next level. For you and your family to get to the next level just consider this as a reboot. When you know better, you do better and this is your time.

Step three.

Work together.

Couple shaking hands

Promise that if you’re a family, if you’re a couple, you’re going to work together and promise to mitigate, get rid of any conflict, as you’re going through this plan.

The purpose of the plan is to be financially free, but also to provide marital harmony.

Step four.

Write down your plan.

Once you agree on where you want to go and exactly what your plan is going to be, write it down, and put it on your bathroom mirror. Paste it on the wall next to the bed and make sure that you’re both in accordance, working your plan day by day.

Cash or credit?

Cash vs credit

Now that you have a plan, let’s explore whether you should go cash-only, or if credit cards are the best way to go. There are certain advantages to credit cards and credit accounts.

For one, you will build your credit. The reason you need to build your credit or rebuild your credit if you’re doing a reboot is for when you’re ready to lease a home, lease or purchase a car, buy a home, or make any business loans to grow your business.

You’re going to need to have a line of credit. This line of credit allows the lenders, the banks, and the credit unions to know that you’re a good risk for them to loan money to so you can buy your home or build your business.


Related article: Pros & Cons of Credit Cards – What You Need to Know


Another advantage of credit cards and certain credit accounts is you get to earn points. You get rewards! So at the end of the year, at the end of the month, you actually have credits that you can use for something fun.

And a lot of people save up all year, their points on their credit cards, so they can have that family vacation and have it paid for by their credit card. So consider that as a benefit for you of having a credit card.

Now that we’ve established it’s important to have credit in your name, how will you track it?

Well, one thing is that good credit cards will do is track it for you for free.

They’ll actually give you your credit score and they’ll let you know if anything compromises that credit score. So you can build your credit as you go and not have to worry about contacting those agencies regularly. They’ll take care of it for you.

Leverage is another good reason to have a credit card or a credit account or a line of credit at your bank or credit union.

When you have leverage, that means you have buying power. So when that opportunity comes up, the car that you want is on sale. The house that you want right now is the right one. You have leverage if you need it to make a purchase in an opportune time.

If you’re a traveler, or if you plan to travel, I can’t imagine how difficult it would be if you’re not able to travel with reservations, and for those, you’re going to need a credit account or a credit card.

You’re going to need to buy air tickets. You’re going to need to buy train tickets. You’re going to need your reserve, a hotel, or an Airbnb. Maybe you need to rent a car.

None of those things will be possible without a qualified debit card or a credit card. Now to distinguish the two, a credit card is actually money you’re going to pay later on an account.

A debit card gets sucked right out the minute that you put it on your card from your bank account, that already has cash in it.

So as soon as you click your card in a debit situation, the money’s gone and there’s no debt owed.

Either one of these cards is going to be necessary when you’re traveling but you need to know is this.

If you’re using a debit card and you show up to a hotel to rent that room for a couple of nights, they’re going to take a debit from your account, much more than you actually need to pay for those rooms. That ties up the money.

So it’s not free for you to pay other charges, to pay for your hotel food or other gas.

It’s actually going to be tied up for days sometimes even weeks until it’s released back to you for you to be able to use.

So if you use a debit card for that kind of a reservation, remember you need to have enough cash in that cash reserves account to make sure it doesn’t cause you a problem when you’re traveling.

For online purchases these days, almost everything is done on a credit account using a debit or a credit card.

When you have a credit card you’re able to make purchases, open accounts, have everything automated, and not have to wait for an invoice to come and payment to be made.

So we’ve talked about credit versus cash, and now you have a way to determine what’s right for you at your house.

Cash reserves

Let’s talk about cash reserves. The Dave Ramsey organization recommends a $1,000 emergency reserve as a start. I feel that’s too low.

I think you need to have several months of basic expenses. That should be the first goal.

Cash reserves

Now, if you’re in a reboot, a thousand dollars might seem like a lot of money and it’s a really great first step, but I want that to be a very elementary first step and shoot for the stars and go for several months income in your cash reserves.

Once the cash reserves are there, leave it alone!

If you need to drive to the next town, find a bank that doesn’t have ATM access or transfer capabilities.

I had a client years ago in her nineties that said she, her whole life had a DNT account and she kept talking about her “D and T” account. And I thought, “what is that?” So finally I asked her, “what is your DNT account?” And she said, “honey, do not touch!”

So if you need to set up a DNT account, don’t touch it, actually put it in another town, make it so.

So when it comes to tracking your expenses and writing down your plan, how much you need in cash reserves, and how much you need for your monthly expenses and your spending plan, you can download one of those simple apps that are so convenient.

There are many of them. The two that I think work really well are Every dollar and Mint.

They’ll help you track your expenses and keep written down that plan that you’re on your path toward.

So we’ve discussed tracking your expenses. We’ve discussed having a written plan. We’ve discussed, whether you should use cash-only, or credit only, or a combination, but you know, the answer has got to be found by you.

The answer is probably some combination of those things, some cash and some credit held together in a healthy, balanced way.

Is Dave Ramsey wrong?

Has he been wrong all this time? And I would have to say, no, he’s not wrong. He’s got wonderful systems, wonderful training, a wonderful heart to help the world, get their pocketbook, right and their finances in order.

And if you’re on that path, remember it doesn’t have to be a rigid path. There might be a couple of gray areas here and there, but what you need to remember is to stay on the path.

And if you do that and you always have a goal in mind, that’s written, you will get there in time.

So if you’re ready to learn more about the truth about money and take positive action to secure an abundant future, subscribe to my newsletter.

Please share with us your journey, any questions you have about this subject, any concerns that you have about this content, please let us know.

We’d like to start that conversation and engage with you.

My name is Judy Copenbarger. God bless!

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