GOBankingRates works with many financial advertisers to showcase their products and services to our audiences.
These brands compensate us to advertise their products in ads across our site.
This compensation may impact how and where products appear on this site.
Commitment to Our Readers
GOBankingRates' editorial team is committed to bringing you unbiased reviews and information.
it’s possible for you to read more about oureditorial guidelinesand our products and servicesreview methodology.
20 YearsHelping You Live Richer
Reviewedby Experts
Trusted byMillions of Readers
Dave Ramsey needs no introduction topersonal finance.
He has helped hundreds of people emerge unscathed from the shackles of debt into financial independence.
This article will explain why you should think twice before going credit-free.
Your landlord, lenders and even some of your employers will base their decisions on this figure.
Having a credit score is always better to strike better deals with lenders, McGlynn said.
Similarly, if you explore lenders to get a car loan to buy a car.
How do they judge your repayment capacity?
Yes, your income documents are essential, but are they sufficient?
The answer is no because your income documents show nothing about your creditworthiness.
The only document that does so is your credit score.
Many employers check credit reports, especially for positions involving financial responsibilities.
Similarly, insurance companies use credit scores to determine premiums.
The higher your credit score, the better your chances of getting concessions in premiums.
The process is theoretically sound but practically less predictable and prone to errors.
Different underwriters might interpret information differently.
Applied correctly, credit cards ensure that one builds credit without debt.
Responsibility is the key to building a good credit rating, McGlynn said.
While it has potential drawbacks, it emphasizes financial discipline.
People wanting to control their finances and avoid the pitfalls of debt appreciate this no-nonsense and straightforward approach.
However, financial planning is never a one-size-fits-all.
This is where long-term financial stability is more appropriately attained: by building and maintaining a credit score.
More From GOBankingRates
Share This Article:
