The first reason that I use credit cards for almost every purchase is rewards. I used to get and use points for travel. Currently I get cash back as I find the travel rewards are not worth as much as they used to be.

Second, I used to travel a lot on buisness and would be reimbursed after filing an expense report by my company. I would regularly run ~8-10K/ month through my credit account, never paid a finance charge as my company reimbursed quickly and I filed on time. (If not the story may be different as always your milage may vary.) Using a credit card allowed me to do this without keeping a cash cushion in the bank to keep from bouncing checks. Some will say that the company was just using my good credit to finance it’s operations, and technically that may be true, but for reason one above I did not mind one bit. I took quite a few “free” trips when I got miles and recieved ~$200 month when I started taking cash back.

The third reason that I use credit is that often I can get several % off at a store for a purchase if I open an account with them. For example next month I plan on purchasing a new HDTV I know what my budget is and which model I plan on purchasing. A certian store nearby offers 10% when you open an account. IF this brings the price to below what I can get the TV for elsewhere then I will take advantage of it and pay the ballance of the first cycle. (of course I read the fine print to be sure there is not a manditory finance charge or early payment penalty, etc.)

Now I have a question for you. What is the difference between useing a credit card for a planned purchase and paying it off without incuring finance charges and your electric bill? The electric company bills you in arrears effetively this is CREDIT. Not only that but you really do not know how much you are putting on this credit account, unless you are really anal abut checking your meter and the rates. Doesn’t that violate Dave’s statement to NEVER use credit?

If you feel that your situation calls for debit cards over credit or cash only please manage your finances that way. Only you know how you behave and why. The reason that I listen to Dave, alot, and others is that I am constiantly trying to make sure that I am not missing something in myself. That is why I really try my best to check out the sources.

The easiest person to delude is yourself, and I try to always keep that in mind.

I meant to say “you certianly will do yourself NO harm by following his advice.”

Ducking from the flame throwers that don’t read this post first.

On the other hand, I wish you luck in finding the study, although I do belive that it is a legend. I would be, I hope, the first to admit I was wrong on this point if someone does locate it.

I just don’t get it. What is it that people are objecting to? The man? His faith? His economic precepts and advice?

Mostly what I see out there is people thanking Dave profusely, and just a small contingent of nay sayers. What gives? Even the articles that the author of this blog entry found supports very much the idea that there may be significant patterns in the psychology of how people handle their finances and make purchases that can either be guarded against (by a consumer), or exploited (by a marketing exec). I believe the article referenced above was more from the perception of marketing to capitalize on that psychology.

Anyways. I think just for grins _I_ might have a go at finding this study, just because it would be interesting from the standpoint of the psychology surrounding conversations like we are having.

Cheers.

But you can’t track it down. I have tried others have tried. I do not belive this study exist. If it does then it is simple to provide a citation that can be used to obtain the record. But no one can. Even emails to Ramsey result in the response that they do not have it or really know the title but they have seen it referenced in numerous OTHER sources. Thus my assertion that it is URBAN LEGEND.

<<<>> BOTH His other sources do indeed give the source as a study done by D&B but I have found not title of the report, report number, or date of issue. THus there is no way to find it or a copy of it. Again I have an email from his web site were they specificlly state they do not have a copy of the report or know which report it is only that they have seen it referenced elsewhere.

<<>> NO The Mcdonald’s study only looked at average ticket totals. THere are MANY MANY reasons that larger ticket totals corrisponded with credit card usage that do not equal credit cards make you spenld more.

<<> Nope not in the least.

<<>> I take issue with a study being used to espouse a one size fits all approach to ANYTHING, most expecially when you are completly unable to provide the study you are quoting or anything that can be used to locate it.