My wife and I finally did it. We got rid of our last credit card. Last February, we got a love letter from Capital One. In that letter, they stated that they were going to raise our interest rate from 8% to 17% for no apparent reason. We used the card occasionally, and haven't carried a monthly balance or paid interest on the card for a couple of years.
Inspired by Dave Ramsey's books and website, we decided we're going to stop borrowing other people's money and thus being required to play by their rules.
This morning I called Capital One and closed the joint account. This evening, we decided to light a fire in our backyard fire pit and roast some marshmallows and credit cards. The video above is one of our credit cards. It didn't give up easily: no bright flames or puffs of smoke, just a slow, smoldering death.
As a substitute, we have two checking accounts, one at a bank and one at a credit union. We'll keep a few hundred dollars in one of them for the occasional online purchase, and the other one will continue to be used for our normal day to day purchases.
From now on, we will be planning our purchases, spending money we already have, and we will no longer have any worries about whether the last credit card bill was paid on time.
But, you may ask, what about EMERGENCIES? How will we survive if something unexpected comes up? As it stands right now, we have almost as much in savings as the our credit limit on that card. If an emergency came up, give me two minutes on the computer to transfer the money into my savings account, and I'll pay for the emergency with my debit card.
Have you considered getting rid of your credit card(s)? Please post your comments below.
