Why this Dave Ramsey follower still uses a credit card

As much as I preach the Dave Ramsey financial gospel, there is one solid thing that I disagree with him on.

I think you can get out of debt and pay your bills and still have a credit card.  

Now, as Paul Harvey would say, here is “the rest of the story.”

We never struggled with credit cards.  We had a car loan and student loan when we took Dave Ramsey’s Financial Peace University.  We were young and dumb, BUT we were smart enough to know that paying 18% interest was just DUMB.

So I say this all with a disclaimer:  If you’re still silly enough to pay 13%-30% interest, or think balance transfers are an advanced financial decision, this post may not be for you.

In the last couple of years we began to use credit cards fairly heavily.  Not because we’re accruing debt, but because of the type of household we run.  My husband is a self-employed salesman and we realized that all of the money he was spending each month on gas, hotels, and even some fast food, was doing nothing for us.  After a visit to our local bank branch we realized that opening one of their cards could help us accrue some points and at the very least get cash back or some small travel.

Here are three reasons we use credit cards:

Travel Hacking  

Exactly two years ago my mom saw Bryce of 10xtravel talking about Travel Hacking on Good Morning America..  Not only was Bryce a familiar face from my hometown of only 3500 people, but he helped me (via email) come up with a plan to fly our family of 5 to Australia using credit card points.  I know that Dave likes to poo-poo credit card points ,but we were able to cut the cost of our Australian airfare by nearly $4000.  We also saved $450 on an expensive Sydney hotel and still came home with a bunch of miles to fund some free flights to Banff(we paid about $125 in taxes vs the $1356 cost).  Travel hacking takes focus, but for organized people like us, the benefits outweigh the work.

American Airlines what I would have paid

Discounts

We have two American Express cards- two major hotel branded cards- and both of them offer discounts on everything from groceries to airlines and even chocolate.  If you have an American Express card, scroll down on the main page and just “Add” these discounts to your card.  Here are the promotions currently added to my card:

credit card savings

Another example I can think of is the Fairmont credit card.  They provide breakfast coupons, spa discounts, and more when being a cardholder while also staying at their hotels.  The Fairmont card does carry an annual fee, so it’s important to weigh the cost with the benefits

Security

I know numerous people say that debit cards are just as safe as credit cards, but I beg to differ.  If someone gets ahold of your debit card number, they aren’t essentially spending the issuer’s money, they are spending YOUR money.  Credit cards also provide numerous extra benefits that my debit card does not- such as some rental car coverage, lost baggage coverage and more.  I feel safer using a credit card online (and who doesn’t make lots of purchases on the internet?).

Conclusion

So while we LOVE Dave Ramsey and will forever be indebted to him (see what I did there?) for our financial peace, we really do think that credit cards can be used responsibly.  It’s not for everyone (if you’re renting your couch, please don’t open a credit card), but we’ve found using credit cards to be beneficial to helping us reach our travel goals-  and save us some moola!

What do you think?  Do you use a credit card for travel benefits and discounts?

DR credit card

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