Why I REFUSE to Play the Credit Score Game

Smart Money Debate - Why You Should Not Worry About Your Credit Score

Welcome to the 4th Smart Money Debate at ReadyForZero! To see the other side of this debate, read David’s post: Why Your Credit Score Matters (Even When You’re In Debt). And then let us know which argument was more convincing!

This post was written by Brad Chaffee, who in 2008 passionately launched the award-winning blog Enemy of Debt to inspire others to radically eliminate debt from their lives. Contrary to what some people may think, he says he lives in an actual home, drives two paid for cars, and his debit card works remarkably well. He started the blog Beyond Debt Freedom to help inspire himself and others to remain vigilant in forging the path to complete financial independence even after becoming debt free.

Perfect FICO Score Is Probably Zero QuoteWe’ve heard our entire life that we must “build our credit score” because if we don’t we would not be able to enjoy life’s many pleasures and conveniences.

Now look at us.

Most people have two car payments, bloated mortgages, insane amounts of student loans, several lines of credit and multiple maxed out credit cards. They’re mismanaging so much debt they can barely breathe, let alone live the life they’ve been promised by the very society that perpetuated this hoax.

Me? I don’t play that game.

You can say what you will but I haven’t played that game for almost 5 years. I’ve seen both sides of the debate and experienced life from both perspectives. I’m living the debt free life with no FICO score and, as a good friend of mine Steve Stewart once said, “The perfect FICO score is probably ZERO.”

Never again will I make a single financial decision based on what my FICO score will or will not do. Never again will I chase a score that rates my financial worthiness on how much debt I can or cannot manage.  Never again will I fall for the lie that my credit score is who I am.

You are not your credit score!

No amount of fancy graphs and data points will convince me otherwise. I’ve lived on both sides of the fence and I like the greener, softer, debt free grass on this side. Yeah, I know what they say about having a low, or no, FICO score; I won’t be able to travel, get a good job, rent a car, an apartment, or even buy a house…blah, blah, blah.

The fact that people still push this nonsense drives me bananas.

I’ve done plenty of traveling, rented a car and even an apartment – all without the almighty credit score. And even IF we were going to get a mortgage when we buy our next home (which we’re not) we could do so without playing the credit score game – or as I like to call it – THE DEBT TRAP for those who haven’t been shown this simpler, more rewarding way to live.

We will pay cash because we are not giving another person a single penny for the privilege of getting something before we can afford it. We’re done with interest payments and paying more for our purchases simply because we do not have the patience or willpower to wait.

As Dave Ramsey says: The credit score is more accurately described as an “I love debt score” because everything you have to do to have one is linked to a debt product. Try having a credit score without debt. I know, I know, technically you can “build your credit score” by paying your credit cards off each month but I only have one thing to say about that:

How is that working for you America?

The fact is that a majority of Americans DO NOT pay their credit cards off each month, even if they fully intended to when they opened their accounts. Add to that the fact that most Americans don’t have any significant savings in place to cover emergencies and there begins the debt cycle.

Americans are trapped in this cycle and are struggling. Besides debt they all have something in common. They are more worried about their credit score than eliminating their debt because the experts tell them that paying off and closing credit accounts will damage their credit score.

Why do “financial experts” continue to push the idea that you must have a credit score to live a good quality life? Liz Weston – whom I respect dearly – said at the Financial Bloggers Conference “Credit scores are very important”. I’m not surprised she said that, she wrote an entire BOOK about credit scores.

Suze Orman has made a career around the promotion of building your FICO score, again, perpetuating this idea that having a good credit score is necessary to living a respectable and financially worthy life. But I’m just a blogger, what do I know?

What we hear:

  • The only way to earn rewards is by using a credit card – NOT TRUE.
  • A debit card is not as safe and secure as using a credit card – NOT TRUE.
  • The only way to get a good mortgage is to have a good credit score – NOT TRUE.
  • A good credit score is the only way to prove you are financially responsible – NOT TRUE.
  • A good credit score is an essential part of your financial plan – ALSO NOT TRUE.

What is true:

You only “need” a credit score if you plan to go into debt for the things you want to consume, but it’s NOT necessary for your financial survival or to have the better things in life.

With products available like PerkStreet’s Debit Card that earns rewards or cash back, eCredable.com which helps you prove your financial worthiness with or without a FICO score, and good old-fashioned manual underwriting you can do, and have, a lot of the things that people say you need a credit score to enjoy.

I’m not judging anyone choosing to play the “build your credit score” game. According to the experts it’s what we are supposed to do.

I just wish these “financial experts” would stop spreading these myths. Stop saying you MUST have a good credit score – because it’s just not true. If you MUST have a good credit score then why is my life so much better without one?

According to them isn’t that supposed to be impossible?

A FICO score means nothing to me and I’m perfectly happy living without one. Pursue a credit score if you want to but I’m here to tell you that you DO NOT need one in today’s world.

I love my debt free life and I’m not willing to give that up because someone else says that I should.

So as for me and my credit score, I’m READY FOR ZERO! 🙂

To see the other side of this debate, read David’s post: Why Your Credit Score Matters (Even When You’re In Debt).

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  • TB at BlueCollarWorkman.com

    Well, I can’t say I disagree with any of this. My wife and I feel the same way!! Every couple years, we check our credit score becuase we want to make sure it isn’t WAY off of where it probably should be just in case we suddenly need some sort of crazy loan (like if one of us gets realy sick maybe?)…but generally speaking, neither of us give a crap. We have no real use for it. For every reason you said. Credit scores are dumb to worry about. D. U. M. B.

    • Thanks TB! I’d say most people would have an issue with my stance simply because the other way has been jammed into our heads as “the way it is”. My problem isn’t so much with credit scores, because if someone wants to play that game they have every right to, but it’s not the only way to get the things they say you can’t get or have without a credit score. Thanks for sharing your thoughts! 😀

  • Preach it brother! I’ve been telling people this for years now. Hopefully more and more will get this message and run with it. Life on the debt free, FICO free side is great.

    Do you think some of the more well known experts push the need for a FICO score because some of their largest advertisers and partners are credit card companies? From one side of their mouth they say you should be debt free, and out of the other side they say you should manage your debt well and maximize your credit score. Which is it? Hmmmm…

    • Exactly Dr. Cabler!! Does any one wonder where the myth that you “NEED” a credit score came from? Creditors, lenders, banks and people (financial “experts”) who benefit some how from perpetuating this terrible lie.

      I do not NEED a credit score!

      I have much respect for my friend David who wrote the opposing argument but what I think he failed to realize is that for all of the reasons he said you need a credit score, you can have and do those things without chasing a score.

      It’s just not as popular because so many people are scared to go that route because of the constant talk about how important your credit score is from experts. It’s like they say, if you say something loud and often enough, anyone will believe it even if it is not true. This is a perfect example of that.

      It was a scary transition for us too but we are so glad we are living our life with this philosophy. Thanks for sharing your thoughts my friend! 😀

      • Just follow the money and you’ll see why the myth has been perpetuated so deeply and for so long.

      • Brad, thanks again for a fantastic article. I do agree with you that many of the people who benefit from the credit score system are the ones who are the loudest proponents of it.

        However, where my opinion differs from yours is that I believe for most people it’s wise that they attempt to keep their score as high as possible because there are important times when it will be necessary – especially on rental applications or when buying a house.

        Where I live (in the Bay Area) it’s hard to even think about buying a house, which means I’ll be renting for the foreseeable future. And every time I apply for a new apartment they check my credit score. Without a good score, I’d have a heck of a time finding a good place to live.
        But for those who don’t need to rent (perhaps they already own their own home) maybe it does make sense to not worry about it. Either way, I’m enjoying this debate!

        • Dude, manual underwriting and eCredable have made it possible for anyone to get a mortgage based on real life circumstances and payment records.

          Equal Credit Opportunity Act has clear language about a consumers right
          to have all their payment information “considered” when being evaluated
          for creditworthiness. It doesn’t state the lender has to give you a
          loan, but they must consider all your bill payment history.”

          So you can have a mortgage my friend! 🙂

          • No offense, but I think you missed the point. A mortgage in the bay area is not financially responsible for many. To *rent* in a nice neighborhood you need a good credit score. To get a job for a certain class of labor, you need an ok credit score. If you are skilled enough that will never come up when you look for a job, and rich enough to be able to buy a house with cash, then bully for you. That doesn’t mean that not having a credit score can’t significantly interfere with other people’s lives.

            For what it’s worth, I think it’s hideous that people do use credit scores for things other than issuing credit, and not exactly accurate to use them even for issuing credit, but the world isn’t the way I want it to be in many respects. My dislike of the system does not change other people’s needs for credit scores.

  • I always enjoy your “waving the middle finger at the financial status quo” attitude, Brad. 🙂 What I got out of reading both articles is that you can take a couple of approaches to your handling your finances:

    1.) Deliberately make your financial decisions to give the credit industry a big EFF You. And save yourself a crapload in interest. But (in my opinion) potentially make things a little less convenient at times in handling your finances. Because let’s face it, interest payments are basically a “convenience payment.” It’s like buying a teeny tiny 1oz bag of chips from a vending machine. Sure it’s cheaper to go get a bulk bag, but you have to leave work and give up time and energy to get to the grocery store and buy it.

    2.) Deliberately make your financial decisions to boost your credit score. In doing so, you are certainly preparing yourself to use that financial vending machine and admitting that you will probably do so – and paying interest in the process (but since your credit score is great, you get the best interest rates possible).

    Those are the extremes…….personally, I think I’ll fall somewhere in the middle….with what I like to call Door #3.

    3.) I’ve never made a financial decision in my life with my credit score in mind. Maybe I should have, then I wouldn’t have ended up 109K in debt. LOL. But putting that aside, I know what my credit score is, and I do check it periodically. However, I go about my daily life with the attitude of paying my financial obligations on time each and every month. If I do so, my credit score will take care of itself.

    Will I ever take out a loan again (buying from the financial vending machine)? I can’t say I won’t….but thanks to debates like this I’ll probably think long and hard about before I do.

    “Maybe we can make this car last until we have enough cash to buy a different one.”

    “Maybe we can at least make it last long enough to maximize the cash on hand before we go visit the dealership.”

    Great questions to ask……thanks for the debate guys!

    • This is a really interesting way to look at it, Travis. I think you’re right that to some extent we each need to decide on the approach that works best for us (given our current financial position and goals for the future). And I wouldn’t be surprised if most Americans fall into the 3rd category you mentioned of trying to keep tabs on their score but not being overly worried about it. Glad you enjoyed the debate! Care to participate in a future one? 🙂

      • I’d be honored to participate in one! Send me a tweet or DM with info when you think you have one I could contribute to!

    • I am a rebellious one when it comes to debt or anything related as you well know. I realize my views and opinions aren’t for everyone but the point I wanted to bring home the most is that regardless of what the financial experts, banks, and creditors say, you don’t NEED a credit score to do the things that they say you need one to do. It’s just not true. 🙂

      I check my credit history but not my credit score regularly to make sure there is nothing fraudulent going on in my name. I did however check my score for a post I wrote on EOD a while back that surprised me. My score was in the 700’s and that’s with no activity at all for more than 3 years. I do not have ANYTHING open at all yet my credit score was still that high. Makes me wonder. How is that possible. I didn’t listen to anyone about leaving credit accounts open. But it has since come back as “not enough information to generate a credit score”.

      I’m perfectly okay with that. If I have to borrow money to have a score, even if that is by using a credit card and paying the balance in full each month — I still choose not to.

  • We generally treat credit scores the same way TB does, but I am curious about your statement: “The only way to earn rewards is by using credit cards – NOT TRUE”
    It may not be the ONLY way, but it is a very easy non-invasive way for those of us that pay in full each month. How do you earn rewards? What percentage of your purchases do they amount to at the end of the year?

    • My argument isn’t that it IS the only way my argument is merely my way of rebuking what I have heard from people for the last 4 years about how they like to earn rewards using credit cards. And for the record, I’m not at all belittling anyone who chooses to use credit cards for that purpose. If you choose to and can pay your balance off each month in full then more power to you but I do think that even using them at all puts someone at much greater risk for debt down the road through no fault of their own via unexpected hospital bills etc.

      We haven’t had a credit card since the end of 2007 and I’m quite positive we never will again. Personally I do not see the point of having one but acknowledge some choose to use them for rewards and to track expenses. I’d rather not. I use a Perkstreet Debit card and have received great rewards and cash back in the two years I have been with them. As far as percentages, though it’s not something that motivates me — have been 1-2% cash back. I just choose not to do business with cc companies because I think they are greedy, selfish savages that take advantage of many Americans. I will say however that I believe in personal responsibility but I do not think there is anything good about credit card companies and how they operate.

      • GregBrady

        I have never carried a CC balance and don’t know why it should be harder for someone to pay that bill in full than the bill from their utility, cable or whatever other company might send a request for payment. Years ago when bank interest rates were higher, paying by credit card allowed you to accrue a few weeks of additional interest on the money you would be paying to the credit card company by delaying payment slightly. Now that doesn’t matter since the damn Fed has kept interest rates at 0 and robbed us savers from earning money on our deposits. The rewards are nothing to sneeze at…I just got $250 cash back rewards on my Visa from using the card. I’d say that’s worth it. But I don’t have trouble exercising self control over my spending so there is virtually no risk that I’ll have to use my CC beyond what I can pay in one month.

        • Good points, Greg. There are definitely some people who have a hard time paying off the balance, and in some cases that is due to unexpected life events or crises that force their hand. Your points are well taken, though. And good point on the rewards – if you can utilize them they can pay off quite nicely!

          • GregBrady

            This just brings home the absolute necessity of establishing a cash fund for unexpected or emergency expenses. Suze Orman recommends having cash on hand equal to 8 months of one’s salary that would cover a job loss if that should occur. It is really important for people to live below their means if at all possible and set aside even a small amount of cash every month so credit card usage isn’t required if an emergency occurs.

  • That’s right Brad, preach it!

    It’s finally happened: We have everything we need to live in America with No Debt, No Credit, and have NO problems. Electronic payments can be made with a Debit Card, PerkStreet has given us a great checking account where we can earn rewards WITHOUT debt, and those of use who are trying to reach the PERFECT FICO SCORE (which is ZERO, because even Craig Watts from FICO says 850 may not be able to be achieved by anyone) can still qualify for the best rates on a mortgage by using eCredable.com.

    No Debt + No credit = No Interest Payments
    No Credit Score + eCredable = Best mortgage rates on refi or purchase

  • Brad I totally agree with you on this. The thing that gets me is that the
    FICO score was originally developed to help determine credit worthiness,
    but instead a lot of people use it as a measure to determine whether or
    not they are winning with money. I’ve coached lots of people who are
    struggling to stay ahead each month but “have a really good FICO score.”

    The FICO score can’t tell anybody how much money you have in the bank, all
    it tells you is how good you are at paying back your debt. Well you know
    what? If you pay off all your consumer debt, cut up the credit cards, and just pay your monthly mortgage payment (if you have one), you are going to start accumulating some serious cash in no time. Which will make the need to borrow more money obsolete!

    But like Brad said, if you are going to be borrowing money for the rest of
    your life, you probably do need a FICO score. But for those of us who
    have have decided that this isn’t how we are going to live our lives,
    the FICO score isn’t a big concern to us.

    • “I’ve coached lots of people who are struggling to stay ahead each month but “have a really good FICO score.”

      It just doesn’t make sense! People make financial decisions based on what their score will do. Pay your bills, make smart financial decisions, and live debt free. Whatever your credit score does who cares? If it goes down so what! It’s only a bad thing when you’re dodging your bills and financial obligations. It’s not a bad thing when it drops because you stopped borrowing money and are choosing to live a debt free life. that should be seen as a GOOD thing! 🙂

      • The bigger problem is the endemic one, where the population of the US as a whole has been duped by financial institutions into believing that they must actually possess debt to obtain a credit score – if you disbelieve this, try getting a credit score without taking on debt. Then according to the FICO model, the ability to repay the debt currently held is the key differentiator in creditworthiness of an individual. Any of us can see this model is open to the most profound abuse by unscrupulous financial institutions. Compound this by my situation as a businessman and employer of 30 people, turning over $5m and feeding all these families. Outside the US I am considered an entrepreneur. In the US, I am classified as Self-Employed and with it, higher risk than a regular employee. You could argue why am I not considered to be a lower risk in the FICO model than a reguar employee. I am not looking to split hairs over higher or lower risk, only to point out the glaring flaws in the FICO model.

        • Thanks for sharing your perspective as a business owner, Alan, it’s clear that the FICO model has some issues.

          • Lala

            One of the major issues with FICO is no record of good, they only report the bad. It’s like a punishment if you had a bad financial month it instantly drops score ignoring the 8 months of on time bill pay.

          • Richard Remer

            I gave up on my credit score after I saw a bad mark for paying off my car early. Not only do they not report on the good, they report the good things as bad.

  • koinam

    something that may be a problem for some though: earlier this year i had my bank account closed when i was ill with a cranial nerve neuralgia – somehow i had a $21 overdraft and since i was unaware of its use during my illness and so busy trying to deal with the as yet uncontrolled pain – poof, bank account closed – i paid it as soon as i realized what had happened – anyway, it seems there was a new federal banking law put into affect the first of the yr 2012 – because i haven’t had any credit owed ergo no credit score for over 12 yrs, now i can’t get a bank account ie. all of them now do a credit check and turn you down if you don’t have a score – weird to be penalized for owing no one ! add to that i’m soon due to begin collecting social security and after march 2013 only electronic delivery will be for ss payment by the govt !

    • Wow, that sounds frustrating! I hope you’re able to find a bank who will open an account for you. It does seem strange that you wouldn’t be able to get a bank account simply because you have no history of borrowing.

  • Tom Edward

    I have been living debt free for years. My father-in-law taught me how to do it, and it was simple. His theory was, “If you can’t pay cash for something then you do not need it.” I lived by those words for years, I don’t know, or care to know my FICO score. I have money in the bank, I don’t owe anyone any money, I am not giving some financial institution my hard earned cash by paying interest. My life is stress free and I do what I please. I got sick of people telling me the my FICO score told them who I was, and it is getting worse. Many employers are using FICO scores as a means of determining who they hire, good thing I am self-employed.

    • Glad the debt-free life is working well for you! Thanks for your comment.

  • Maria

    I’m glad someone finally said it!!
    As an expat recently relocated to the USA I found the whole credit score pitch a total nonsense. First of all, if everybody repeats the same thing with the same exacts words, you KNOW there’s a lot of brainwashing behind it, serving larger economic interests (all companies make more money by having their customers get debt). Secondly, I have lived in several countries and I’ve never found a similar system… Everywhere you have a good financial reputation by simply having low or none debt. Finally, I was able to get 2 bank accounts, 2 credit cards, a small car loan and rent an apartment with zero credit score. After this initial experiment, that’s how I intend to rule my new life on the US… Debt free and worry free!

    • Interesting to hear the perspective from other countries- thanks for sharing. And glad to hear it worked out for you!

  • Chris

    Right on Ben. I’m wondering if there is a movement or an organization set up to give strength in numbers to people who do not want to use credit for hotels, renting cars or anything else. Perhaps if there was an entity like this we could have more clout and force services and merchants to take notice. I always believed NOTHING is as good as cash. There is no way they could ignore us if we were formed in to some type of collective group? Your thoughts?

    • Hey Chris, I think that is a really interesting idea and although I don’t know of anything like it that exists currently that doesn’t mean it cannot exist in the future. Who knows, maybe you could be the one to start it? If you created a website dedicated to that idea, I bet a lot of people would pay attention. I know one guy who would definitely want to get involved:

    • koine2002

      I’m late to this conversation, but if there is enough demand there will be a supplier to supply it. At this point, there just is not enough demand for there to be a big enough supplier. It’ll require either the FICO independent people (with whom I strive to be) making their own supplier or said group helping folks live FICO independently to create a market for said service.

  • Josh

    I know this is a bit of an old post but it got my attention. Recently I’ve been trying to refinance my home but I refuse to let anyone view my credit. I tell all of the lenders to read this http://portal.hud.gov/hudportal/HUD?src=/program_offices/housing/sfh/buying/streamli

    If you read the handbook and or Google “FHA Streamline non-credit” is says all over the place that you do not need a credit check, yet every lender out there requires one. Makes you wonder what goofball named that fancy refinance… I tried to get some goverment clerks to give me a solid answer but they tell me to call a number because they have no idea why a “non-credit” loan requires credit.

    I for one WISH I could pay for a house with cash but unfortunately I cannot. Like many Americans who require more than what an apartment or town home can provide, I need a house. Not to mention when it is paid for, you have a very strong asset.

    The problem is the hidden definition of what credit is, credit from my experience is exactly this: What your likely hood is of consistently making someone else money. In other words, if you are responsible, you cannot, in any way shape or form have a high credit score (700+) I pay off all my bills, I paid off all my credit cards years ago and refuse to have another because I don’t need them. Thus my credit is stuck around 700, I firmly believe it is impossible to go higher without making more people money and in turn being irresponsible with my money.

    • Very interesting point! I haven’t researched this specific question before (i.e. whether lenders offer refinancing without a credit check) but I’ll look into it. If you find out anything more, we’d definitely like to hear about it. Good luck!

  • GregBrady

    WOW…I feel like I am no longer alone! I live in a middle class neighborhood where I am about 15 years older than most of my neighbors (I just turned 51). I am disabled and cannot work, yet am completely debt free with a hefty investment portfolio and liquid emergency fund,…paid cash for my house 7 years ago. I watch my neighbors dig themselves deeper and deeper into debt buying all kinds of toys, adding on to their homes, taking vacations, etc. and they are only in their thirties. One illness or disability (like what happened to me) and they are in bankruptcy. I don’t even know my FICO score and have not ever even checked it. I have no plans to borrow money because I live a frugal yet comfortable life. It is SO refreshing to read your article and see that there are some young people who GET IT…freedom = not owing anybody anything!

    • Wow, that’s a very interesting comment. Sounds like you have a unique perspective among your neighbors. Keep up the good work!

  • AspirationsOfThought

    I’ve no credit cards, don’t want em, and i’ve not had a bank account in 8 years. I either cash my check at the bank that cut it for my company, and eat a horrifying 7 dollar fee, or I hit Walmart and cash it for a 3 dollar fee. This system is flawed, it’s broken, it’s insufficient. Feels like we took a wrong turn to me. I’m not buying into this crazy system, there’s gotta be a better way.

    • That’s an interesting perspective! I can definitely understand the rationale for not having a credit card. But have you considered opening just a simple bank account so you could deposit paychecks without having to worry about exorbitant fees? That could save you some money!

  • Veronica

    I feel so much better after reading this. I got several credit cards in my early 20s and was responsible with them for years. Then just last year I lost my job and was unemployed for about 8 months and went heavily into debt as I could no longer make payments. What’s funny is that I have every intention of paying off everything that I owe, but credit card companies would rather sell the debt for pennies on the dollar to collection agencies than give me some breathing room as I get financially up to speed at my new job. It feels good to know that I can stop worrying about my credit score and just focus on becoming debt free and start saving and that I will still be able to rent and travel without credit. Not being able to rent or travel were my two biggest worries.

    • Hi Veronica, I’m so glad you enjoyed this post! It sounds like you’ve had some hardships but I’m glad you are getting back on track and wish you the best with becoming debt free. Have you tried using http://www.readyforzero.com yet?

  • Pepe
    • You are absolutely, right! Thanks for pointing that out, and for the link to the article.

  • Debbie

    I’m an international student, and I never understood why debt was such a problem in this country until I started looking for an apartment. I just makes no sense. To me I always thought being in debt means you’re irresponsible with your money, so how come here it’s proof of responsibility? It’s so frustrating. I just want to find a place to live. Why should I be in debt first?

    • Yes, that is very strange, isn’t it! Some landlords will rent to you if you show them proof of income, such as payment stubs. Or perhaps if you explain to them that you are an international student and that you have funding for your education and living expenses, that would convince them. Good luck!

    • Anna

      You have a good point, Debbie!

  • citizen144

    About 2 years late to the table but here’s the reality: A FICO score is not a measure of ability or willingness to pay back a debt. It is designed as a measure of profitability to lenders. How reliable a source of recurring interest revenue are you? That’s all the banks want to know. If you don’t carry enough interest bearing debt, score goes down. If you don’t make payments within 30 days, score goes down. Don’t get me in to the fact that corporations (you know those people represented in Washington) all typically set up terms of 60-90 days with prepayment discounts. A luxury not available to mere mortal consumers. Nope, consumers must live on the 30 day debt cycle designed by banks for revenue projection.

    The FICO score, credit reporting and an economy driven by debt and investment (the Wall St. pyramid scheme) mean this experiment we call “free market capitalism” is set on a course for imminent demise. It is not sustainable.

  • AaronaZ

    I have four lousy cards with debt under $10,000. I tried to consolidate with my local federal credit union. I have a credit score of 751 and a perfect credit report with NOTHING negative on it for over 10 years. Do you know they turned me down because I have too much debt. This made me disgusted and I realize this truly is just a game, it doesn’t matter if you diligently pay your bills and are very honest and pay everything on time. It truly is just a game. Good to know that I am not alone in coming to this conclusion. What a bummer.

    • Hi, I’m sorry to hear about that! Have you looked at our Debt Consolidation Resource Center:


      There are some articles there that can help you with debt consolidation if that’s what you want to do.

      Let me know if they’re helpful!

    • Lala

      Same thing happened to me! I stopped playing the game.

  • tim

    I just turned 30. Facts: I was born and raised below the poverty line. I got a minimum wage job out of high school and worked my way up through various companies. My current income is lower middle class. I own my home and cars outright. I started saving money when I was 18, by 28 I paid cash for my home. I have never been in debt in my life. I have no college education. My home has all new furnishings. I eat whatever I want, wherever I want, whenever I want. I take epic vacations. I have several long term investments.

    I plan to retire by 50.

    Anyone can succeed if they work hard, don’t bother keeping up with the Jonses, and never ever ever try to build credit. Fact: A credit score shows how good you are at going into debt. Having a credit score should be considered shameful. Be smart, people.

    • Very interesting perspective! Thanks for sharing your experience and for your comment, Tim.

  • Lissy

    Banks hate me. I have no debt. No student loans- paid all my college in full from day 1. Worked through college with cash only jobs. Paid all rent up front in full 6 months at a time. Paid for my car in full with cash up front. Have a card in my husbands name that technically I could use but never do- though it has a $8,000 credit limit available on it if I need it for an emergency. I have applied for my own credit card numerous times. I am always rejected due to “no credit” history. Sure I pay electric and internet monthly in full but they won’t count that. I don’t even have a contract on my cell phone. I will never need to buy a house- I will inherit my parents which is fully paid for. I will also get a nice fund from them when they die. Honestly, banks hate me. I have $10,000 in available cash to burn but what is the point? I have everything I want and then some. I guess I will just never get a credit card.

    • Wow, that’s great! You are very financially secure, and it sounds like it all happened without using credit – nice job! It’s ironic that you can’t get approved for a card, but I guess you’re right, you probably don’t need one. Thanks for the comment.

    • Anna

      Good for you! I have never had a credit card either.

  • Cary

    How do you go to college then with out taking out a loan? Most people want you too have at least a 4 year degree and that is at least $25,000 even for a state school.not a semester but at least 4 years is 25,000 assuming that all the classes are offered every semester, (which their not). I went to community college and had to take out a 6000 loan. I think that college is making it hard not to go into debt. So me and my wife have adopted the idea of making a life not a living. I have decided to take up indie video game programming and she has decided to be a writer we don’t mind living in a apartment with low rent. We have a car that is completely paid off and we pay for everything with cash. i sell anything that I don’t use and use they money to buy other things kind of like trading in a way. We don’t shop at retail stores unless we have too and if we can get it for free then that’s what we do. I have no shame because the life on credit and stress leads to suicide, homicide, insanity, Zoloft, substance abuse or a life of stress then cancer and chronic body aches. I like the way were doing it. We got married for free and our rings are tattoos paid with cash. This whole American idea that you have to go into debt and suffer to be happy is old we are both 26 and have decided that enough is enough. We are here to exist. we are not here to be bodies feeding a machine.

  • Stan Carey

    The fallacy here is that you have be in debt to have a FICO Score.
    I use a credit card for everything and keep my money in the bank. Then at the end of the month I pay the card. There is no debt because I have the money in the bank. Rotate through a few cards and after while you have a FICO over 800, and $90,000 in available credit and every bank in the world will give you money. I travel on points, and rewards, I get discounts at stores with Store Card user discounts 5% to 20% and I shop from my free hotel stays with the rewards I get. If I want to get the new TV with 0% interest over 24 months I get it because my FICO says I’m good to go. I set up an automatic payment in my bank account and pay the TV off one month early, gain the advantage of a decreasing dollar, while letting my money collect a little interest on my bank money and I pay no interest on the purchase. I don’t live for my FICO score, I make the FICO work for me, while I live off of other peoples money with points and rewards and I’m never in debt. With my discounts and free stuff I’ll bet I come out $500 to $1200 ahead of the cash only people annually.

  • RETUSAF1995

    Last time i used a CC was June 2001. I cash out my paycheck every payday (i don’t trust banks either).

    I stopped at a car dealer a few weeks ago, saw a car i liked so i have the salesman run the numbers and look up my CS. First he put in my name, could not find anything, he was shocked. Never happened before. Next he used my SS # and still nothing. I asked, is that good, he said no. But i figured, i was off the radar, no debt, no score.

    My car has 75,000 on it but the car is like new (Toyota Camry XLE 2004). I don’t like the idea of a $400.00 car payment, debt free is so much more fun.

    I pay cash for everything. In the past year i brought a 70″ tv, I7 desktop, used laptop, new phone (pay as you go). Last 2 years, 60″ tv for both my sons, all cash.

  • Gloria

    “A debit card is not as safe and secure as using a credit card – NOT TRUE.”
    Try telling this to someone whose debit card has been cloned (and their bank account associated with it drained). Ask them how long it took the bank to put back the money.

  • Jean Watkins Corley

    I do not owe anyone. I rent a home, have a SUV, have 4 debit cards and have a small saving account. My credit score is riddled with mistakes. I fixed it in 2001. I went to hospital for 2 yrs and next time I looked there were 20 mistakes again. None having to do with my illness or doctors bills. I REFUSE to work for free for 3 credit agencies. The consumers must come together and have a law passed that credit agencies can not put stuff on our credit until they make an attempt to see if it is right. Why should I pay for a report, work a month or 2 to fix it and pay them for the privilege? It does not make sense. The game is rigged to the credit co. to win while we pay for nothing. Something is wrong with this picture. We must force the Federal Gov. the hold credit agencies feet to the fire and force them to do the WORK. Why do we pay them for a report and work for free to fix their mistakes? They are paid to provide a service. They should make sure the service is free of mistakes. If they are not sure its correct then do not put it on a persons reports. SIMPLE AS THAT! Who agrees with me?

  • Efraim Kristal

    David, I enjoyed reading your blog post. I’m also an ardent advocate of living debt free, and subscribe to your general idea that it’s absurd to pay someone else for the privilege of buying something early I cannot afford now–including automobiles and homes. I assumed some debt for college–and that was a huge mistake in retrospect. Today there are free colleges that offer up to a bachelor’s degree for less than the cost of textbooks at typical community colleges. I wish I’d had that option when I went to school. Otherwise, as you’ve written, I haven’t had to assume any further debt and feel freer, more in command of my life decisions, for it. You’re right that the immensely predatory lending machinery in the USA is largely behind the specious credo of necessary responsible debt. After the financial catastrophe of 2008, more US citizens, I think, are waking up to the perspectives you portray here. Thanks, again, for the post. I’m looking forward to sharing it with friends.

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  • Estafador

    I just don’t need credit because everything I get I OWN. I own the house, hell I might just buy the deed. I OWN the car. I don’t lease, I don’t finance. I don’t like debt and I don’t like creditors. So own it, don’t “rent” it. Unless it’s an apartment, feel free to rent that please. I don’t care if that means I have to live maybe even below my means, it just makes me work harder and build faster. The rich don’t stay rich by doing nothing after all (except the kardashians but we’re not them so forget about that).

  • Lily L

    Yeah sure you can do that if you have enough cash.
    That is, if you want to ditch the game that everyone is somehow force to play, you have to be strong enough to live in your own world.
    People who agree with the blogger may also have enough cash, well established, do not have to worry too much about life. But what I am afraid is that people who are vulnerable, not well established may deeply believe in your opinion and ditch the credit score game. I think it will be more considerate to talk about the two sides of credit score rather than just be showing and glorifying this one side, since differently people certainly will be better off with different choices.
    Additionally, it seems to me that reporting tax is also one way to establish credit score?

    • Eetheart

      If everybody, including us who do not have a ton of money lying around, just stood up and went against the game, the game would collapse.

  • It sucks because I’m straight out of college but have no credit score because I worked while in school instead of getting a loan. Now I’m realizing that being responsible is a punishment when it comes time to buy a home.

    The reason I want to buy a home is that in my college town area homes are cheap and rents are high so that buying a home is a much better financial decision than renting.

    Unfortunately, it is difficult to do so without a credit score 🙁

    • Eetheart

      That’s straight up screwed up. You do the responsible thing and you’re “not trusted” because you’ve never been in debt before? The fact that you chose work over debt screams integrity and trust to me.
      If I were a home-owner, you’d be my first choice.

  • Eetheart

    When I moved from Europe over here, I had no idea what a credit score was. In Europe, or at least in Denmark where I’m from, they look at your past loans to see if you’re good at paying back in time. And if you never had a loan, they see that as a good thing and most of the time, you’re good to go.

    When I moved over here and got married to my lovely wife, we were told: “You need a credit score to do that” “You need a credit score to do this”… And so on. And I thought to myself “WHY???” Why do I need debt to do simple things like open credit percentage rate instead of overdraft fees at my bank? I’m debt-free. The only debt I ever had was around 800 bucks of overdraft at my bank in Denmark, because I was struggling as a student (I refused to take a student state loan, so I opened up for overdraft ). But I paid it off and I decided I will never go into debt again if I can help it.

    You know what that means? It means I’ll probably never have a credit score here in America. Well, I don’t care to be honest. We’re renting a place now just fine, we didn’t need a credit score for that. Maybe one day we’ll buy a house with mortgage, but even then I’m sure there are ways to make it happen without a credit score (one google search gave me a ton of opportunities!).
    So seeing this blog post is really enlightening. I don’t want to go into debt so that I can be seen as trustworthy. That’s backwards logic for you. “You have no debt, so we don’t trust you.” What the heck?? Are you daft? I mean, am I right? I’d much rather trust the debt-free guy with my money than the one who has had a ton of debt.

    • Ralph A. Dee

      Thank you! It all started in 1913 when the US’s money policy was hijacked by the Federal Reserve. It was the biggest crime in history.

      • Eetheart

        Correct me if I’m wrong, wasn’t this around the time the government forced people to cash in their gold? 😮

    • Anna

      Thank you! I’m also from Europe, living in America. I never understood the logic behind it either. Honestly, I couldn’t care less about my credit score.

      • Eetheart

        So good to see like-minded people! 🙂

        • Anna

          I feel the same way! 🙂 My husband is American (born and raised) but he doesn’t care about his credit score either. We enjoy living the debt free life!

          • Eetheart

            Can we like be best friends? 😀 Because we have less than a handful of friends who actually see credit score the way we do. Everyone else keeps telling us how we’re missing out by not doing credit card offers left and right.

  • Terrance Edmond

    Thank you for this post!!!

  • koine2002

    I’ve begun the journey toward FICO independence. I have significant CC debt from when I was between permanent work. I had a contract not renewed (a 1099 post with a college) due to lack of funds. I took up substituting to pay rent and utilities. However, I had to use credit cards for things beyond that. It took me a year to find new employment. Anyway, I just took out a refi loan for a 3 year term to pay them off. I plan to pay it off in less than 2. From that point, I will be debt free and intend to stay that way short of a mortgage. Said mortgage will be no more than a 15 year note that will be paid off in 10 or less. It is possible to do manual underwriting with certain mortgage companies.

  • Jeff Ravnkilde

    I now this is an old article but felt like saying something.

    I have 9 credit cards and debt free. I use my cards monthly only for a tank of gas to keep them active and maintain a credit score. It’s easier to rent an apartment without references. If there is only one apartment for rent and fifty people apply for that apartment, the applicant with the best credit repot and score gets the apartment.

    Having a credit report doesn’t mean putting yourself in debt, no does it have to give you gray hair. You can still live on the soft green grass in life with a score.

    Hope it helps.

  • Lala

    I stopped playing the credit score game after years of getting my score up to 750 and still being turned down for loans. I tried to buy my first home and was still turned down. I always paid my bills never late on rent or utilities, etc. That is when I realized that the system is a scam designed to control you. You have to basically pass whatever test “they” give you to be able to get “approved” for loans. They did me a HUGE favor by rejecting me, because now I am debt free, able to save and stress free. I opened a successful business with my savings and I see how other businesses like mine are now working for the banks instead of the freedom of working for yourself. I do not want to buy a house anymore, I want the freedom to live where I want and not have a mortgage over my head for 30+ years. Whatever I do in life will be paid for upfront because I am so OVER the control of these greedy interest-rate vampires! I have been meaning to send CHASE a nice thank you card!

  • david

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  • james42519

    i have a credit card because family thought i needed one. all i use it for is phone bill $45 and pay every month and score over 700. reason thought was good idea was because it will lower prices for car insurance and stuff. at this point not a big deal really to do this. people that have trouble are the ones that don’t pay every month.