We’ve shared in the past that Mike used to have bad credit due to a foreclosure when he was 18 years old. Just this month (10 years later) it was removed from his credit report, so we thought it would be a good time to reflect on the pros and cons of building good credit.
Dave Ramsey is famously opposed to having any credit score whatsoever. We’re not so quick to jump on that bandwagon. Watch to find out when we think it’s a good idea to build credit, and when it’s not.
Have you ever wondered how you should answer the question, ?debit or credit?? How can store owners have minimum purchases and offer cash discounts? In this video we discuss the pros and cons of debit cards vs. credit cards.
When researching this video we found the history of the ?debit signature? fascinating, so we go off on a tangent. We finish by explaining the difference between running a debit card as credit and using a credit card.
Once you get out of debt, it’s time to build an emergency fund of 3-6 month’s expenses. How much to keep in your emergency fund depends on things like your job security, insurance, income sources, how many people you’re supporting, and much more.
In the video, we talk about how we don’t really have an emergency fund, but more of an “opportunity fund.” Normally, you should never spend your rainy day savings on anything that isn’t absolutely necessary. We tend to break the rules 🙂
How would we get out of debt if we woke up one day with student loans and a credit card balance? By taking extreme measures to cut spending and earn extra income.
We discuss everything from cutting up our (hypothetical) credit cards to selling our excess furniture and gadgets on craigslist. Although it’s easy to stand on the sidelines and say “that’s what I would do,” we hope this is a help to someone out there.
Before we can begin to talk about budgeting or investing, we need to get an idea for where you’re at financially. The easiest way to do that is to start tracking your spending for a month.
You can do that by hand, but there are websites and software that will do it for you. We use https://mint.com. We have been using it trouble free for over 5 years. It’s tracked and categorized almost 6500 transactions!
While we’re waiting for data to accumulate, you can calculate your net worth to see where you stand financially.
NOTE: If you are a viewer outside of USA, you can purchase a program called “You Need A Budget” (YNAB) that makes manual expense tracking easy.