Discover Card - Bad

[slimmer13]

Most people are drowning in debt.

I have debt, but I'm not drowning, I use it as a tool. I'm about to add some more. I am likely building a new home on another piece of property that I own. I'll rent out my current home and even with the mortgage rate increases, the rent should almost, if not completely cover both mortgages.

 

[Aero Denezol]

Almost everyone who owns a house or a car has debt. If you have no debt, it negatively impacts your credit score. Credit score measures credit risk, not moral decision making. This isn't China - not yet anyway.

Just pay your bills on time and preferably pay them off every 30 days.

When my step-daughter saved enough to buy her first car, we compelled her to take out a small credit union loan and repay it within six months. The debt helped her build her credit the right way. She is in great shape to buy a home now at 27. Some debt can be good if you play the game with discipline.

 

[Hueco]

Well if you have the money to make a purchase, you might as well spend it using credit to get the 1-2% back then pay it off immediately. You then have buyer protection and extra cash. Also, ever tried getting money back from a debit card transaction? Much more difficult than a credit card.

You will never convince the cult of Ramsey that credit cards have and can be used for legit benefit to your life.

Good luck though!

 

[Flopsweat]

Almost everyone who owns a house or a car has debt. If you have no debt, it negatively impacts your credit score. Credit score measures credit risk, not moral decision making. This isn't China - not yet anyway.

Just pay your bills on time and preferably pay them off every 30 days.

When my step-daughter saved enough to buy her first car, we compelled her to take out a small credit union loan and repay it within six months. The debt helped her build her credit the right way. She is in great shape to buy a home now at 27. Some debt can be good if you play the game with discipline.

I've increased my credit score by buying $5000 + items with a credit card even though I had the cash. I'd pay on it for a few months and then pay it off. For a few dollars in interest, I bumped my score a few points.

 

[Mikej]

I've never figured out where the cash slot in my computer is for online purchases? And the few times I've needed to contact Discover, amazingly, it takes about a minute at best, and 2 minutes at worst, before I get a perfect English-speaking person on the other end. Wifey uses a Cabela's Card to pay all bills and get's something like twice the points I do.

 

[Longwalkhome]

I have one credit card, my Costco card. I pay it off as the bill comes due. Biggest bill I had was for car repairs, $2,600 and I paid it off right away.

Credit card companies make a lot of money in different ways.

They charge you for the card.

They charge the merchants 4% if you buy something using the card.

They charge ungodly interest if you don't pay off the debt. That's their big earner, they don't want folks to pay off the debt right away when they can charge 28%+ on the principle.

 

[mhayd93]

You will never convince the cult of Ramsey that credit cards have and can be used for legit benefit to your life.

Good luck though!

There is merit to both strategies, Ramsey's method is definitely a proven strategy especially for those who do not have the self-control or financial sensibility to utilize credit/debt responsibly.

 

[Hueco]

There is merit to both strategies, Ramsey's method is definitely a proven strategy especially for those who do not have the self-control or financial sensibility to utilize credit/debt responsibly.

Ramsey is a charlatan whose advice boils down to "spend less." He doesn't offer advice on how to actually make money or use debt effectively - and I say he's a charlatan because the guy definitely did not become wealthy taking his own advice.

"Spend less" is about as useful as "there are no stupid questions."

It's advice that can actually hinder your growth of wealth.

When my step-daughter saved enough to buy her first car, we compelled her to take out a small credit union loan and repay it within six months. The debt helped her build her credit the right way. She is in great shape to buy a home now at 27. Some debt can be good if you play the game with discipline.

This. I bought my first house at 30 - $325k 3.7% mortgage with 0 down. Having an extensive history helped immensely and I doubt others with less history would have been offered those terms.

My first new car was at 1.9%. Could have paid it off immediately, waited 3 years instead. Total interest paid was less than $1000.

Then I used an auto loan using newly paid off car as collateral to buy wifey's engagement ring. Paid that off right quick because I wanted the title back. Great, now that one car gave me two closed loans on my history.

And on and on. At some point in your life, you're going to ask "the system" for money so that you can set yourself up for a better life - whether that is a business loan, a mortgage, etc. When that time comes, you'd best have the history to prove that you are trustworthy or you may just not get the offer you need.

Use credit effectively to set yourself up for the future you want for yourself. "Don't have a credit card" is just plain dumb "advice".

 

[DunRanull]

Screw Discover and the democrat liberals they rode in on. I pay cash as a rule for firearm purchases anyway.

 

[DunRanull]

Ramsey is a charlatan whose advice boils down to "spend less." He doesn't offer advice on how to actually make money or use debt effectively - and I say he's a charlatan because the guy definitely did not become wealthy taking his own advice.

"Spend less" is about as useful as "there are no stupid questions."

It's advice that can actually hinder your growth of wealth.


This. I bought my first house at 30 - $325k 3.7% mortgage with 0 down. Having an extensive history helped immensely and I doubt others with less history would have been offered those terms.

My first new car was at 1.9%. Could have paid it off immediately, waited 3 years instead. Total interest paid was less than $1000.

Then I used an auto loan using newly paid off car as collateral to buy wifey's engagement ring. Paid that off right quick because I wanted the title back. Great, now that one car gave me two closed loans on my history.

And on and on. At some point in your life, you're going to ask "the system" for money so that you can set yourself up for a better life - whether that is a business loan, a mortgage, etc. When that time comes, you'd best have the history to prove that you are trustworthy or you may just not get the offer you need.

Use credit effectively to set yourself up for the future you want for yourself. "Don't have a credit card" is just plain dumb "advice".

"Eat rice and beans, beans and rice!" Yeah buddy!

 

[69chevelleart]

I have three, maybe I'm their only business

That being said, it's hard to beat the Citi Double Cash card for cash back if you're willing to deal with their horrid website and customer service.

No, you are not their only customers, we have Discover as well.

 

[mhayd93]

Ramsey is a charlatan whose advice boils down to "spend less." He doesn't offer advice on how to actually make money or use debt effectively - and I say he's a charlatan because the guy definitely did not become wealthy taking his own advice.

"Spend less" is about as useful as "there are no stupid questions."

It's advice that can actually hinder your growth of wealth.


This. I bought my first house at 30 - $325k 3.7% mortgage with 0 down. Having an extensive history helped immensely and I doubt others with less history would have been offered those terms.

My first new car was at 1.9%. Could have paid it off immediately, waited 3 years instead. Total interest paid was less than $1000.

Then I used an auto loan using newly paid off car as collateral to buy wifey's engagement ring. Paid that off right quick because I wanted the title back. Great, now that one car gave me two closed loans on my history.

And on and on. At some point in your life, you're going to ask "the system" for money so that you can set yourself up for a better life - whether that is a business loan, a mortgage, etc. When that time comes, you'd best have the history to prove that you are trustworthy or you may just not get the offer you need.

Use credit effectively to set yourself up for the future you want for yourself. "Don't have a credit card" is just plain dumb "advice".

Saying credit cards are automatically bad would be dumb advice, telling certain people not to have one is not necessarily dumb advice.

Again, avoiding debt is a valid strategy that many Americans use successfully, and is a much better option than attempting to "build" credit via maxing out cards to the point where you can hardly pay off the interest each month, let alone the actual balance. For many people, that ends up being the case.

I don't think it's as binary as you're making it out to be. Too many variables to say that credit cards and debt are 100% good, while actively avoiding credit is 100% bad.

 

[Flopsweat]

and is a much better option than attempting to "build" credit via maxing out cards to the point where you can hardly pay off the interest each month

No one here has advocated building credit by maxing out credit cards. Maxing a card is counter to the advice that I offered.

 

[mhayd93]

No one here has advocated building credit by maxing out credit cards. Maxing a card is counter to the advice that I offered.

I was contending Hueco's assertion that advocating against credit/debt accrual is bad advice. I wasn't saying anyone was arguing for maxing out credit cards, rather that for a lot of people, that's what they end up doing.

I was trying to provide a scenario where "anti-debt" financial advisors have merit, and recommending against credit card use would be a good solution.

 

[Hueco]

I was contending Hueco's assertion that advocating against credit/debt accrual is bad advice. I wasn't saying anyone was arguing for maxing out credit cards, rather that for a lot of people, that's what they end up doing.

I was trying to provide a scenario where "anti-debt" financial advisors have merit, and recommending against credit card use would be a good solution.

I took out my first CC at 18 and immediately maxed it. Know why? Because no bank would give an 18 year old with no history a small business loan. So 0% for 18 months followed by damn near 30% after that was the best I could get offered to me. Bought the best camera gear I could for that $8k (not much in photo world) and got to work on my business.

Paid it back in 12 months. And that's definitely not the only time I've used unsecured debt at intro rates to get essentially a 0% short term loan.

Most of the cards I let die off my credit but not that first - it's been there for 20 years now and pads out my "credit age" to this day.

Dear Leader Ramsey would have preached never taking that first CC - would have said something like, "eat beans and rice and save!". Except, I was already working two jobs ($7/hr and 13/hr) and going to college and paying rent and my car. This was my vegan phase so I was already eating beans and rice and was putting, maybe, $100/month into savings. And it's amazing how that disappeared when my pos car needed work.

Take risks when you're young - and I took one by betting on myself and my skills behind a camera and selling face to face, maxed a CC, and got to work. One of the best decisions I've ever made.

——
If all you see in my advice is "max credit cards with transitory purchases" then you're not paying attention.

We live in a *capitalist* economy. The only way to get anywhere is with *capitol* - the one thing you won't have if you weren't born with a silver spoon in your mouth, like Ramsey.

Unsecured debt is but one tool in the tool basket and it can be extremely useful, especially to young people.

I'm not advocating for getting yourself into bankruptcy - I'm advocating learning the system and all of the tools available to you in that system so that you can use the best one at the best time for yourself.

And Ramsey's swearing off of the use of unsecured debt is antithetical to that point and as I said: actively hinders one's ability to obtain wealth.

 

[Jay Walk]

No worse than

CitiBank
Chase
Bank of America

or Satan himself, Wells Fargo

And by the way, debt is dumb.

 

[oremike]

No worse than

CitiBank
Chase
Bank of America

or Satan himself, Wells Fargo

And by the way, debt is dumb.

When I went looking for a bank to set up my ammo business those four refused my business because it's firearms related. Umpqua said they'd take my money but wouldn't offer any support services. Banner Bank was happy for my business and provide me with full support including card processing.

 

[Jay Walk]

I sold real estate for 21 years and a couple of buyers qualified for home loans at conforming interest rates with NO history of credit and as a consequence, NO credit score.

Lender used alternative credit, usually a phone bill.

Most buyers use credit, I get it, but it can be done without.

I had plenty of vehicle loans in the past but each one was dumb.

 

[mhayd93]

I took out my first CC at 18 and immediately maxed it. Know why? Because no bank would give an 18 year old with no history a small business loan. So 0% for 18 months followed by damn near 30% after that was the best I could get offered to me. Bought the best camera gear I could for that $8k (not much in photo world) and got to work on my business.

Paid it back in 12 months. And that's definitely not the only time I've used unsecured debt at intro rates to get essentially a 0% short term loan.

Most of the cards I let die off my credit but not that first - it's been there for 20 years now and pads out my "credit age" to this day.

Dear Leader Ramsey would have preached never taking that first CC - would have said something like, "eat beans and rice and save!". Except, I was already working two jobs ($7/hr and 13/hr) and going to college and paying rent and my car. This was my vegan phase so I was already eating beans and rice and was putting, maybe, $100/month into savings. And it's amazing how that disappeared when my pos car needed work.

Take risks when you're young - and I took one by betting on myself and my skills behind a camera and selling face to face, maxed a CC, and got to work. One of the best decisions I've ever made.

——
If all you see in my advice is "max credit cards with transitory purchases" then you're not paying attention.

We live in a *capitalist* economy. The only way to get anywhere is with *capitol* - the one thing you won't have if you weren't born with a silver spoon in your mouth, like Ramsey.

Unsecured debt is but one tool in the tool basket and it can be extremely useful, especially to young people.

I'm not advocating for getting yourself into bankruptcy - I'm advocating learning the system and all of the tools available to you in that system so that you can use the best one at the best time for yourself.

And Ramsey's swearing off of the use of unsecured debt is antithetical to that point and as I said: actively hinders one's ability to obtain wealth.

I get that credit is a valid tool, but just because it is valid does not invalidate other strategies like Ramsey's that avoid credit like the plague. It works for a lot of people, just like using credit and debt works for a lot of people. Like I mentioned earlier, there are too many variables from individual to individual to definitively claim that one strategy is better than the other.

Personally I use credit all the time to my advantage, but other people in this same thread have expressed how they have done perfectly fine by sticking to cash. Not using unsecured debt definitely does not hinder your ability to attain wealth; this is really the only aspect of your posts that I am disagreeing with.

 

[DirectDrive]

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I should be using the Costco Card for fuel, but you hafta get to those Costco pumps early in the morning !
And I'm not a huuuge Costco guy.

The Active Cash card I think is better than my Double Cash card because it has cell phone coverage.

Confucius Say :
Do 2% card
Get free gun every year !
True dat