Why Dave Ramsey’s Credit Score Advice Misses The Mark

Dave Ramsey’s tough-love approach to money has helped millions get out of debt, but one piece of advice often misses the mark—cutting credit cards altogether. However, skipping credit can close more doors than it opens. What seems like financial freedom can actually create new barriers in modern life. Here’s why ignoring credit scores can quietly make things harder than they need to be.

Credit Score Affects Employment

Some employers, especially in finance or government, review your credit report during the hiring process. A weak or nonexistent score can raise red flags, suggesting financial instability. That can cost you opportunities, even if your income is stable and your debt is minimal.
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Manual Underwriting Is Rare And Complicated

Skipping a credit score doesn’t mean avoiding paperwork. Manual underwriting is a real thing, but it’s slow and messy. Think stacks of tax returns and proof of assets. Most lenders avoid it because it’s time-consuming and expensive. Credit makes the process faster and, frankly, less painful.
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Higher Insurance Rates When Credit History’s Missing

In most states, insurance companies use credit-based scores to set rates for home and auto coverage. No score usually means higher premiums. While a few states ban the practice, most don’t, so your credit could impact your monthly bills more than you think.
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Renting Without Credit Is An Uphill Task

Getting an apartment with no credit can be a hassle. Landlords typically review credit reports to assess the risk. Without one, you may need a larger deposit, a co-signer or several months’ upfront rent. In tight markets, renters with credit often have a clear edge.
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Home Buying Slows Down If Credit’s Absent

Lenders look for a solid credit trail when you’re ready to buy. FHA or USDA loans may accept rent or utility history but expect extra paperwork and delays. No score stalls pre-approval, dragging out the home hunt when you’d rather grab the keys and settle in.
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Credit Cards Provide Extra Consumer Protection

Think of a credit card as more than a spending tool. Zero-liability rules shield you from unauthorized charges, and chargebacks recover your money if something goes wrong. Many cards also include travel insurance, extended warranties and purchase protection—added peace of mind at no extra cost.
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Credit Growth Doesn’t Mean Taking On Debt

Starting from scratch with credit might feel tricky at first, but a secured card backed by a deposit is a great option. You can also grow credit with Experian Boost, which adds rent and utility payments, or by becoming an authorized user on someone’s account.
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Co-Signing Without Credit Is Nearly Impossible

Helping a friend or family member with a lease or loan means your credit report takes center stage in the approval process. No credit score? No co-signing. Lenders need assurance, and without proof of repayment history, your signature won’t count for much on paper.
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Utilities And Phone Plans May Cost More

Lacking a credit history often means paying a deposit on utilities. In some areas, customers without credit are automatically limited to prepaid or basic services. Providers use credit-based pricing models to predict payment risk—even for the basics like water, electricity and your cell phone bill.
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Business Loans Depend On Personal Credit History

Most small business owners lean on their personal credit score. Sole proprietors and applicants for business loans usually face a credit check. A low score means higher rates or even rejection. Until your business builds its track record, your finances carry the weight.
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International Travel Often Requires A Credit Card

Hotel check-ins and car rentals abroad almost always require a credit card on file. Debit cards may be declined or have large holds applied. Moreover, added perks, such as fair exchange rates, lounge access and travel insurance, make credit cards a valuable travel companion.
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Cash-Only Living Doesn’t Work For Big Expenses

Large costs like medical emergencies or car repairs don’t wait for savings to catch up. Without credit, you’re left to drain cash reserves or go without. Installment plans offer flexibility, but those often require a credit check. In short, living without credit limits your options when real-life bills hit hard.
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Subscription Services May Deny Enrollment

Some digital services—like streaming platforms, cloud storage or app subscriptions—require a credit card to start or maintain access. Without one, even a free trial can be out of reach. This limits convenience in daily life and cuts off access to common tools others use without a second thought.
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Unexpected Holds Tie Up Debit Card Funds

Debit cards aren’t always treated equally. Gas stations, hotels and car rentals often place temporary holds well above the purchase amount. That can freeze your cash for days. A credit card, on the other hand, absorbs the hold without limiting your immediate access to money in the bank.
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Credit History Can Affect College Financial Aid Decisions

Private student loan lenders often check the applicant’s or co-signer’s credit. Weak or no credit could mean rejection or sky-high rates, adding pressure to already expensive education costs. Even some scholarship programs and tuition payment plans consider creditworthiness when evaluating long-term reliability.
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