No. of Recommendations: 3
Going back to the study in question, for example, that 15% increase in spending is an average. Not an across the board number. So if 3/4 of the people spend 20% more but 1/4 of the people do not spend one cent more, then we get an average of 15%. Clearly that looks like an argument for putting the plastic away even if you pay in full, but that also means that 1/4 of the people are leaving points, miles and cash back on the table unnecessarily if they follow his advice as inviolable gospel.


I agree with this totally. Looking at the average behavior is fine when you are talking about groups of people as a whole.

But, when deciding on personal behaviors what is important is to look at your individual behavior.

To put it another way...if we look at median household income...there is information to be gained from doing that. However, if we each planned our budget based upon median household income there would likely be problems since it would be specific enough to our situation!

I do use a cash back card for expenditures (Amex Blue Cash) and do pay it monthly. Even though I've been in credit card debt (and still am) I feel OK about doing this.

Having said that ...I do think Dave Ramsey makes a valid point which is that people don't get rich because of getting back cash on credit card purchases or doing 90 days same as cash purchases. At the end of the day, those are little things that have no significant impact on wealth building. I think he would think that focusing on them is focusing on the wrong things and distracts from the main ways to make money. I tend to think he is right and while I may continue to use a credit card (since I don't like debit cards and don't like paying with cash/check) I am not going to kid myself that it is something that will make me huge amounts of money.
Print the post  

Announcements

UGC Disclosure Notice Regarding Credit Card Posts
Community board discussions about credit cards are not provided or commissioned by banks who may have advertising relationships with The Motley Fool. Responses have not been reviewed, approved or otherwise endorsed by the bank advertiser. It is not the bank advertiser's responsibility to ensure all posts and/or questions are answered.
TMF Credit Center
The Motley Fool Credit Center arms you with real tools and simple messages, that will help you in every credit situation.
What was Your Dumbest Investment?
Share it with us -- and learn from others' stories of flubs.
When Life Gives You Lemons
We all have had hardships and made poor decisions. The important thing is how we respond and grow. Read the story of a Fool who started from nothing, and looks to gain everything.
Community Home
Speak Your Mind, Start Your Blog, Rate Your Stocks

Community Team Fools - who are those TMF's?
Contact Us
Contact Customer Service and other Fool departments here.
Work for Fools?
Winner of the Washingtonian great places to work, and Glassdoor #1 Company to Work For 2015! Have access to all of TMF's online and email products for FREE, and be paid for your contributions to TMF! Click the link and start your Fool career.
Advertisement