Paying Off $9,482 Debt In 5 Months

FatWallet forum member NewNole2001 details how they just finished paying off $9,482 in credit card debt. Here’s how Nole did it:

First NewNole2001 boned up on their personal finance knowledge by reading message board posts and listening to Dave Ramsey’s show. Then Nole negotiated the interest rate on one his cards lower. The others credit card companies wouldn’t budge, so Nole did some 0% interest balance transfers to stop the interest hemorrhaging. Nole used the “Snowball Method” to to, after paying his bills, plunk down $1600 a month, plus any extra money Nole could scrape together towards paying off his debt. Five months later, Nole’s debt free and working on building a 6-month emergency fund. “I can’t even imagine living like I used to. What a waste of my hard earned money!” Nole writes. “I’d like to sit here and say that it was such hard work, but really, it wasn’t, I just needed to direct my money in the proper direction.”

Paid off the last of my CC Debt today [FatWallet]


Edit Your Comment

  1. NoNamesLeft says:

    I paid off 10,000 dollars in credit card debt by paying 10,000 dollars to my credit card in one month! Who knew it could be so easy!

  2. I think the “Snowball Method” is only legal in Nevada, though.

  3. A.W.E.S.O.M.-O says:

    Let’s get the obligatory stuff out of the way:

    “I never carry a balance on MY credit card!”

    “The easiest way to pay off credit cards is to live within your means and not incur so much debt in the first place!”

    There. You guys feel better?

  4. ThunderRoad says:

    It’s good to see these stories. It tells those that are in debt that it can be done. Yes it takes sacrifice, but it’s doable.

  5. joshthephenom says:


    Not quite yet…
    How about, something about NewNole2001 taking it seriously.

  6. bravo369 says:

    good for him. It’s always nice to hear these stories. I also can’t help but think that those carrying balances on their credit cards each month are not keeping track because how could anyone see the hundreds of dollars in finance charges being levied against them for absolutely nothing and not try to get the cards paid off as soon as possible

  7. uberbucket says:

    The sooner one gets a hold of their rampant consumer whore-ism the better.

    Nole used the “Snowball Method” to to, after paying his bills, plunk down $1600 a month, plus any extra money Nole could scrape together towards paying off his debt.

    What’s it like to have $1600 a month in disposable income? I’m still paying off a week long hospital stay from 2 years ago.

  8. B says:

    @A.W.E.S.O.M.-O: you missed
    “Credit cards are evil”
    “he got what he deserved for shopping at best buy”
    and “He should have used a credit union, not a bank.”

  9. trecool95 says:

    29.99% interest on that Chase card? Holy crap.

  10. SuffolkHouse says:

    I hope when it is all said done that half the credit card companies go f’n broke. Then, I’d like to see the whimpering republicans in congress struggle and fight to bail them out with spirit-weakening welfare for businesses. Hypocrites.

  11. Leah says:

    I wonder how much of that disposable income was spent on stuff that Nole previously thought he “needed.” I had an argument with a friend the other day, since my friend is in credit card debt and still owes on both his cars. He’s going on vacation this summer, and he definitely has places in his lifestyle where he could cut back in order to attack that debt, but he keeps telling me that all his spending is “necessary.”

  12. whereismyrobot says:

    I thought the first part of the snowball method is to save $1000?

  13. DashTheHand says:

    Who would have thought that instead of buying $1,600 in video games, candy, and booze a month he could have put it towards his credit card debt!?

    Woo, what a crazy guy.

    Seriously, lets hear about the rest of his living expenses and his actual salary. Just saying he plopped down a set number of cash each month to pay off his bills isn’t revolutionary. Doing rough math hes making $40k a year or most likely more. I don’t see living on that amount of money remotely hard.

  14. elocanth says:

    I think y’all are missing the larger point here. What he earns per year or how he chose to spend his money on previously isn’t necessarily relevant. The point is that he squashed his bad habits and shared the story of how to do it.

    I don’t care who you are or how much you earn, learning how to stop squandering cash is always a good thing.

  15. goodcow says:

    How much money does Nole make?

  16. Tightlines says:


    Okay, no need to be a douche. We should be applauding this guy for finally taking control of his finances.

  17. skinsfan44 says:

    Huh? I am not quite sure why there is always a need for some angry asshole to throw in a political comment when it has absolutely nothing to do with what is being discussed. I guess if you are unhappy with your life or just a poor slob who never amounted to anything, you need to blame someone. Don’t worry friend, I don’t mind working hard so the democrats can tax the crap out of me so they can redistribute my money to you.

  18. ByeBye says:

    This is what my wife and I do. Congrats to this guy!

  19. Juliekins says:

    This is an impressive accomplishment. No matter how this guy ended up in debt, he took the bull by the horns and wrestled a pretty substantial number down to zero in five months. Maybe stupid spending decisions got him there in the first place, but this is just another in a long line of stories that show this kind of thing is possible. Debt is not just about money. It’s fraught with emotion and judgment (by others and of oneself) and it can seem insurmountable. This guy didn’t just throw up his hands, and that’s great news.

    But…wait…if all these lazy, no good sonsabitches get out of debt, what will I have to feel smugly superior about? The horrors!

  20. pandroid says:

    I’m 2.5 weeks away from finishing paying off $10,500 in credit card debt. It took me 1.5 years… but I only make $15 an hour and got a second job, so I like to think it’s pretty impressive as well. Now to research Roth IRAs…

  21. pmathews says:

    I just don’t like this guy. I can see him eating fast food everyday wondering why he’s still fat. Playing everquest with absolutely no social life. And the best part is he still lives with his mom.

  22. CRNewsom says:

    One way I can see to have extra money to pay down debt is to get a second job. It’s not really all that hard to add a couple hundred dollars a month by working an extra 10-20 hours per week.

  23. pmathews says:

    I don’t know why I’m so bitter suddenly.

  24. SadSam says:

    We paid off $55,000+ debt in 12 and a half months using the Dave Ramsey baby steps. How did I end up $55,000 in debt you ask… I married my husband and he brought the debt with him (bulk of it was debt from his MBA program).

    The Dave Ramsey baby steps are super simple and easy (no its not rocket science) its all about really focusing all your energy on killing debt. We’ve changed the way we live for the better. We have no debt except for our mortgage, we don’t use credit cards (no I don’t think they are evil we just choose not to use them), we have a budget, we track our spending in Quicken, and when we want to buy something big we save up for it.

  25. BlondeGrlz says:

    @bravo369: I never noticed how much interest I was payinging until I put all my finances into a computer program. Once I realized my finance charges alone ate up most of my monthly payment, I got my act together and paid it off. Now I’m amazed that I was ever so unaware.

  26. Extended-Warranty says:

    My simple plan to erase debt: not racking up high interest loans.

  27. @A.W.E.S.O.M.-O: Yeah, but people have to learn this lesson the hard way. Furthermore, it’s not always possible given the current economic situation. It’s easy for people who are comfortable to say stupid shit like, “why don’t all these unemployed people just get jobs?” Easy, but it betrays a certain cluelessness about the person saying it.

    Now, I think there is no reason whatsoever for the comfortable (we know who we are) to carry revolving debt. The number one thing to do is resolve to not use the damn things until the balances are such that they can be paid in full each month. I have had people say, “I’m still going to use my card because I like the convenience, but I’m going to make sure I pay more than I spend.” WRONG! This never happens. The insidious thing about credit cards is that it makes you lose track of what you’re spending money on. All the better to stay on the hook.

    If you like the convenience of using credit cards, for example, to get gas without having to go inside and pay, what I did was what I call the “two card” method. One is a balance transfer card. Don’t even carry that one around. Take it out of your wallet and shred it. Now. The other one is a Visa Check Card from your bank that will rudely remind you when you’ve spent too much money by REJECTING any transaction you can’t pay cash for.

    Every month, you make a payment at least 200% of the minimum balance. Since you’re a comfortable person with a job who isn’t really in trouble with debt, this ought not be such a big deal. If it is, figure out what you can reasonably put toward paying down your card. The rest of the money is yours. Enjoy. If there’s any left at the end of the month, add that to your budgeted card payment. Tax refunds? That stupid-ass check Dubya thinks will “stimulate” the economy? Pay your cards with it. 80% of Americans will be doing the same thing with their tax rebates.

    I got rid of my card debt (about nine grand) in about 18 months. I didn’t have to sacrifice. I didn’t have to eat ramen noodles all the time. I even got to go on vacation.

  28. My partner and I did something similar, but not as quickly as five months. It took us about eight or nine months. We basically rolled up our sleeves and just took a big hit every month and budgeted $750/month to go to the credit card. All the leftover money at the end of the month went to the card. On a good month (our income varies, he’s a massage therapist with his own practice) we’d throw $1,000 to $1,500 at the card. We were lucky with a few good months and a low interest rate. (His USAA card is prime + 0%. Right now his APR on the card is something like 6%. We are indeed lucky.) All it takes is A) realizing there’s a problem, and B) good, old-fashioned determination. I commend this guy for doing that!

  29. Coelacanth says:

    @whereismyrobot: Depends on the situation. It was part of my strategy, but I only began contributing to a savings fund untli after I had paid off a couple of my lower-balance cards first.

    Once my minimum payments became noticeably less, I used some of that differential to stash away money over time.

    Still, my road is a bit longer than this guy’s, but paying off $10,000 in six months is quite impressive. Not sure if I can match this guy’s performance, but I can get close, methinks.

    Ouch on the interest rates. He must have had a few late payments/penalty APRs in place.

  30. Alexander says:

    Paying off debt is the greatest feeling in the world. I was 20 years old and in college when I had already accumulated about $6,000 in credit card debt. I realized I couldn’t continue like that and proceeded to pay it off in about 1.5 years. It was hard because I was working part time at school only making about $700 a month. It was hard but it felt great to be rid of it. Congrats to this guy on a job well done.

  31. NewNole2001 says:

    Hey guys. To all the naysayers.

    I will go ahead and say that every bit of that credit card debt was spent on stupid stuff that I did not need but I told myself I needed.

    Really, the only thing I have to show for it is a $600 desktop computer.

    The point for me as I look back and look forward is that I was blowing loads of money pointlessly and now I’m taking all of that money and using it responsibly.

    I won’t disagree that it was overly easy for me. I just hope that others will see this story and others like mine and decide to get off their butts and take charge of their financial life.

  32. lpranal says:

    Jeeze… I barely even MAKE 1,600 a month after taxes (thanks, wall street + stagflation!), and I have way less debt than this guy did. It’s made me so frugal, I feel like if i had an extra $500 a month I could take over the world in a little over a year. WHEN IS MY STUPID COLLEGE DEGREE GOING TO START PAYING OFF LIKE THEY SAID IT WOULD! ARRRGH. Ahem. ‘scuse me.

  33. Tickthokk says:

    I’m trying to get rid of my debt as well. I’ve got 4600 in debt on one credit card, and I transfered it to one of those 0% for 12 months thing. I won’t be able to pay it off in 12 months but it’s better than 100 bucks a month in finance charges. I would advise people to look at their statements every month, I didn’t realize how much I was being boned by finance charges.

  34. chrisgeleven says:

    I’ve been working on this too. Since I have started, I have paid off probably $3000 worth of debt so far. A long way to go though before I am all done.

  35. anatak says:

    @elocanth: You are exactly right. Personal finance is 80% behavior, and 20% math. There are families pulling down $100k per year, yet with $200k in consumer debt. There are single moms making $25k per year, trying to pay down their $18k in debt. Typically, the size of the hole is proportional to the size of the shovel.

    It’s about cutting your lifestyle and changing your habits to put yourself in a position to win. Without that behavior change, no amount of 0%apr balance transfers or extra income will get you out of debt for good.

    @whereismyrobot: The first *baby step* is to save $1000. Baby step two is the debt snowball.

    @uberbucket: It’s amazing what you can do when you take control of your income. It all depends upon how intense you get about paying off debt. We started our debt snowball with just an extra $100-200. That wasn’t hard to find. By the end of it, with promotions and other extra income, we were throwing serious amounts of money at our debt each month. Something to the tune of ~$3000. Most of the time you won’t start out with an extra $1600 like Noel did. But the beauty of the system is that as you pay one off, that payment gets added to the next and the next and the next. Before you know it, those larger debts will come toppling down.

    But really, it’s about intensity.

  36. Ouche!!

    The “Trolls” hit this heavy.

    To all the jerks who cannot applaud an individual for taking control of his habits, and spending go find some MMO forum where you can argue about how much better Dwelves are than Arves.

    My wife, and I have been “debt free” for around 4-5 years now. That said we’re not real good at saving yet. We occasionally carry a LOW (under 1,000) CC balance on one card, and we are acutely aware of it when we do. We call our CC companies every 6 months, and ask for a rate reduction, and pay off any outstanding balances asap forgoing dinners out, and other “luxuries” until that card is at 0 again.

    I really enjoy hearing when others start controlling their consumerism.

  37. mobilehavoc says:

    How the hell is $1000 enough for an emergency fund?!?!? I’m not even sure if that would cover anything in any type of emergency. I think you should always try and have 6 months worth of monthly payments in savings so if you lose your job or something bad happens you’re covered. That’s just me.

  38. Blackneto says:

    thats for pointing out about the “trolls”

    This guy made some mistakes with his finances. probably didn’t know how to handle them in the first place, but gained some knowlege and did what was neccesarry and these jackoffs post about ‘shouldn’t carry a balance anyway’ and snide comments about ‘just getting an extra job is the easy way out’.

    Can’t people just rejoice in the fact that someone has brightened up and learned how to control his finances?

    Good jorb Nole. welcome to the club.

  39. heavylee-again says:

    @mobilehavoc: $1K isn’t the full emergency fund. It’s just a little to get you started and to cover small things that may come up while you’re snowballing debt. Once the debt is dead, then you focus on accumulating 3-6months of emergency savings.

  40. Blackneto says:

    that $1000 emergency fund isn’t for catastrophic events. It’s to keep the wolves at bay while your trying to pay off debt.
    Then after you pay off all debt except for your house and maybe car then you save up the 6 months.

    Believe me, Having 1G in the bank really changes your outlook when you are trying to pay off debt. The psychological value is much more that $1000. barring a valve job, how many car repairs cost more than 1k?
    how many appliances cost more than 1k (if you aren’t buying top of the line)

    that 1K is there so you aren’t tempted to put anything on credit when you are trying to pay off debt

  41. lockers says:

    @heavylee-again: An emergency fund is useless when you have 10k in CC debt that is around 20%. That 1k is better spent on cutting out that high interest debt. I do agree that any emergency fund is better than no emergency fund, I don’t agree that you should do that _before_ you pay off all your high interest debt.

  42. evslin says:

    5 months? Damn, took me a year to clear $10,000 in debt. Learned some tough lessons along the way, but I’m glad I got it done though. Now I can go back to school without that hanging over my head.

  43. rdm says:

    I hate hate hate the debt snowball so much. Anyone who can do math can see that it’s a waste of interest to just pay the smallest debt off first (assuming it’s low interest). Good that he got out of debt though.

  44. Orv says:

    @Steaming Pile: The other one is a Visa Check Card from your bank that will rudely remind you when you’ve spent too much money by REJECTING any transaction you can’t pay cash for.

    Except a lot of banks won’t reject them, now. They’ll accept them and then tack on a $30 overdraft fee. So your $6 latte just cost $36.

    @mobilehavoc: How the hell is $1000 enough for an emergency fund?!?!?

    It’s not. Adding to it comes later. They’re called “baby steps” for a reason. Most people, if you tell them, “first, you have to save 6 months of salary,” they look at how huge a number that is and just give up. Breaking it down into smaller goals makes it seem achievable.

    @rdm: Sometimes psychology trumps math. You’re right that paying the small one down first doesn’t make sense from a math standpoint, but if it gives someone enough of a psychological boost to keep them on track it’s still a good investment.

  45. mike says:

    I would caution not saving while you’re paying of credit card debt. If you have an emergancy, you’re stuck paying with a credit card again.

    I use the Crown Financial Roadmap (Christian based). Their method is to pay yourself first, while still paying as much of the credit cards as you can. Once you build up to $1000 in savings, start the “snowball” with the balance with the highest interest.

    Lather, rinse, repeat as needed.

    I’m about 5 months away from being debt free (less mortgage, student loan)

  46. heavylee-again says:


    So just sequence the debts by interest rate, rather than balance. The concept is the same, the mental reward is the same and the goal is the same. Big diff.

  47. mike says:

    Holy frick! I didn’t read all the comments.

    I want to add, though, that the guy/gal/couple deserves kudos.

    *golf clap*

    Debt free is the way to be. Drug-free too. But it’s much more exciting to be debt-free.

  48. Chad LaFarge says:

    Order by interest rate makes more financial sense, but you just don’t get the quick sense of acheivement that you do when you do it smallest to largest. Paying off the first few small debts builds you up to take on the larger concerns.

    Also, surprising how few of the constant “surprises” that used to suck up my discretionary income still come around with a simple $1000 emergency fund. I’m not even using the fund… it’s just sitting there repelling Murphy and his stupid laws.


  49. Mr. Gunn says:

    That’s a great accomplishment, but please let it be known the snowball “method” is a dumb idea, because it calls for starting with your smallest balances rather than your highest interest rates.

    Please people, don’t think that’s a good idea. There’s supposedly some psychological advantage to this, but it causes you to pay more in interest than you would paying the highest rates first. If you can’t mentally cope with paying the highest rates first, keep a running tally of how much interest you’re paying each month, and watch that shrink, instead of the balances.

  50. Mr. Gunn says:

    Chad LaFarge: Just as I was commenting on how stupid the snowball method is, here you come. Please, stop.

  51. noisetube says:

    I managed to kill $9600 in credit card debt in 2 years on waitress income. Yes, that’s $2.18 an hour plus tips (and not good ones).

    Now here come the student loans..

  52. howie_in_az says:

    Yay let’s celebrate the fact that some guy had $10,000 in debt and paid his way out of it!

    However, by not carrying the debt and paying credit cards and such, that means he is not stimulating the economy. Thusly he is a terrorist.

  53. BuddyGuyMontag says:

    I’m in the same boat of paying down my CC’s. I split the majority of my low five-figure debt between two 0% balance transfer offers on existing cards. I’ve paid off about half of it, and I’m scheduled to pay the rest of it off by the end of the year. I plan, once the 0% BTs expire in a few months, to flip all remaining debt one more time onto a low BT offer on an existing card, and that should be it.

    The problem with debt management is that it works differently for different people. Salary, credit score, monthly needs play a lot into it. The credit you have available, plus other factors can help or harm your quest to reduce debt.

    Personally, I’m motivated by the fact that I want to buy a house and I know mortgage lenders will love me if I have a 800+ credit score with less than a thousand dollars debt (but still keeping my credit cards active)

  54. BuddyGuyMontag says:

    BTW, one big thing that annoys me: a lot of these famous financial people endorse closing your credit card accounts once you pay off your debt, which is very harmful to your credit score. Cut up the card, yes. Don’t close the account.

  55. Orv says:

    @BuddyGuyMontag: I tend to agree with you. Dave Ramsey’s big thing is he believes people shouldn’t be in debt at all, which makes credit scores kind of irrelevant, though. You have to remember he’s often dealing with people who just can’t handle having access to credit without going deep into debt. For them having active lines of credit is like a former alcoholic having a liquor closet. It’s just too much temptation.

  56. SadSam says:

    Re: amount v. interest rate snowball. For sure, highest interest rate to lowest rate makes the most sense. But the reason amount works well for many is that you knock out lots of small debts first which gets that snowball rolling in the right direction. My husband wanted to pay off our debt highest to lowest interest. I’m super glad that I went with smallest debt to biggest debt b/c the 6+ monsth I spent paying off the biggest debt (husband’s MBA student loan) was awful and I probably would have given up if it wasn’t our last debt.

    Re: credit cards, we both still have 1 credit card but we don’t carry or use the cards. But, we did close a number of credit cards during our Total Money Makeover and my FICO is still above 800.

  57. trujunglist says:

    What the fuck man? If I had 1600 extra a month I’d have 0 debt in much less time than this guy. How about tips for people who don’t have anywhere near that disposable income? Shit, anyone could do well with 1600 after bills and rent and food and whatever.

  58. parad0x360 says:

    If i had $1600 a month that I could throw at bills like that then I would be 100% debt from in 2 months…must be nice to have that kind of extra money.

    If in fact I had that kind of extra cash after rent and everything else I dont think i’d be in any type of debt at all aside from a car payment.

    This goes story is obvious and does nothing to help the average person.

  59. GrandizerGo says:

    Wow, I must say that if I had 1600 a month I would be out of debt as well.

    Cut down on the Filet mignon and Caviar I guess???

    It doesn’t impress me one bit. Months later a judge could have ordered done the same thing I bet…

  60. Orv says:

    You’re missing the point. He probably didn’t think he had $1600 in disposable income either, until he decided to knuckle down and start paying down debt. I bet he abstained from a lot of “necessities” that he found out are really luxuries.

  61. Whiskey Tango Foxtrot says:

    Its all about cutting back on things you don’t need, like that coffee at Starbucks (or in my case Tim Horton’s,) not renting movies, consolidating trips to the store to save gas. Its not *easy* but its doable. I just wish I could find a zero or low “Life of Balance” credit card available in Canada, which I could transfer my CC debt to. You Americans have all the luck!

  62. Traveshamockery says:

    @BuddyGuyMontag: “BTW, one big thing that annoys me: a lot of these famous financial people endorse closing your credit card accounts once you pay off your debt, which is very harmful to your credit score. Cut up the card, yes. Don’t close the account.”

    If you start living within your means, and aren’t going into debt to purchase things, then why do you even NEED a credit score?

    The only things it makes sense to go into debt on are an Education, and a House. Most people working out of CC debt have both already. So screw the credit score myth – it’s just a measure of how good you are at staying in debt.

  63. catcherintheeye says:

    @Mr. Gunn: I’m well aware of the financial implications of the snowball method.

    However, I simply don’t care. There is a psychological benefit to it, one that I find much more satisfying than the financial one. So I pay my 10% balance off before my 12% balance – the satisfaction of seeing another line under my “liabilities” category on my personal balance sheet is worth more to me than the difference in interest payments – there’s a lot to be said for motivation. (Granted, there’s a limit – paying off $2000 at 8% before paying off $3000 at 15% is a different story)

  64. themidget says:

    @Orv: I don’t think that anyone is missing the point. But this guy’s success is not necessarily something everyone can emulate. $1600 a month disposable income is a lot of extra money. The OP said on the Fat Wallet Forum that his monthly expenses are $1700, and he could probably cut that down to $1100. Where is he living, North Dakota? With his parents? My mortgage payment is almost the same as his monthly expenses, and I have a nice 30-year fixed with more than 20% down. Rent in the city I live in, which is still cheap for a big city, is going to be at least $500/month, and that’s with roommates. Most of the people where I live have an hour commute each way with no viable option of public transportation.
    That said, kudos for paying down debt! Always good to hear about someone getting ahead…

  65. BuddyGuyMontag says:


    Education, House, Car. Those are the three big things, which you do need a good credit score for.

    I understand the point about “alcoholics living with a full liquor cabinet”, but if it was just someone in college being stupid and now realizing the error of their ways, that could TOTALLY screw you up.

    I’m saving for a house. If I followed these financial experts help without doing research on my own, I would have ended up cancelling two credit cards that I have 7+ years of history with and looking at a MAJOR hit to my score.

    Not everyone who listens to these debt experts are shopaholics. Some of them were just immature and learning the folly of their ways.

  66. youbastid says:

    @BuddyGuyMontag: Cutting up the card and keeping the account open with zero balance will damage your credit more in the long run than the short-term effect of closing an account.

  67. VotaIdiota says:


    The only “credit score” myth there is is that debt is required to have one.

  68. Traveshamockery says:


    I used to believe in the “Big 3” as well – but I’ve trimmed it to House and Education.

    I drive a 10 year old car, paid for. My wife drives an 11 year old Accord, paid for. I would LOVE a new, or newer car. But I’ve decided I’m going to just save my money and follow something similar to the Dave Ramsey “pay yourself a car payment” method, then slowly trade up.

    Automotive debt is not a necessity for most people, it’s a luxury.

    That said, closing credit cards really is a discipline issue. Between my wife and I, we have seven credit cards, two we actually use. We’re young, so we’ve left the others open to maintain that “account age” information you’re referring to.

    At this point, maintaining a high credit score is more a point of pride for us than it is something with real utility.

    I’m not trying to say this arrogantly, just explaining my personal feelings on the matter.

  69. Orv says:

    @BuddyGuyMontag: I’d narrow those down to two. It’s entirely realistic to pay cash for a car if you can limit your ambitions to cars that are actually affordable, and if you can forgo instant gratification.

    I did the car payment thing once and I’m never doing it again. I didn’t like owing money on something that was rapidly depreciating.

  70. Traveshamockery says:

    @VotaIdiota: “The only “credit score” myth there is is that debt is required to have one.”

    After a period of time not opening new accounts, and with all debt paid off, no revolving accounts, etc. you will no longer have a calculable credit score.

    The formula requires recent data. A FICO can’t be generated without recent (< 10 year old) revolving/new/etc. account information.

    Even some things will still show up on a report, there will be “blanks” in the formula, and no FICO score will be able to be calculated.

  71. Orv says:

    @InfiniTrent: Well, a credit score does have other uses. In many cases it affects how much you pay for car insurance, although some states have made this practice illegal. Some employers will also run credit checks on prospective employees.

  72. Traveshamockery says:

    To finish my point from earlier (I trailed off)…

    People who are in debt because they have difficulty controlling their CC spending should pay off a card and close it immediately. Screw the Credit Report impact – it’ll help them stay out of debt.

    I’ve personally never carried a balance on a CC, so I’m not worried to have multiple CCs still open – I know my wife and I won’t abuse them. Then again, I’m the kind of nerd that freaks out when my checking account balance gets below $1,000.00., so I have nerd/saver tendencies.

  73. BigElectricCat says:


    Uh, no.

    “If you start living within your means, and aren’t going into debt to purchase things, then why do you even NEED a credit score?”

    If you ever plan to buy or refinance a house or car, a better credit score will get you better rates.

    “The only things it makes sense to go into debt on are an Education, and a House.”

    And you need a credit score for that house. Surprise!

    “Most people working out of CC debt have both already.”

    Most, but not all.

    “So screw the credit score myth – it’s just a measure of how good you are at staying in debt.”

    More correctly, it’s a measure of how good you are at *managing* your debt. People who don’t have or don’t use CCs tend to have much lower scores than people who do have and use them. And contrary to your assertion about “staying in debt,” a high utilization rate (having a large outstanding balance in relation to your available credit) actually *hurts* you.

  74. Traveshamockery says:

    Someone didn’t read what I wrote. It’s the internet – I don’t know why I’m surprised.

    I’ll say the first thing SLOW – you…don’t…need…debt…to…buy…a car…

    Save up and buy one…sheesh.

    A house is different. In my comments, I was referring to people (as I clearly wrote) that already have a house and education.

    I’m fully aware one needs a CS to buy a house.

    I’m also fully aware that a high utilization rate negatively impacts your credit score. I never claimed otherwise – I just claimed if you weren’t going to go into debt again, it wouldn’t MATTER.

    My comments were tied together – don’t pull them apart into their individual parts and then claim it doesn’t work – that’s like sticking raw eggs in your mouth and claiming my cake doesn’t taste good :)

    It’s very easy to refute somebody’s points when you frame them the way you want and take them out of context.

  75. Traveshamockery says:

    Your phrasing was correct, though, on the “managing” debt point – what I should have said is that a credit score is a measure is how good you are at staying in debt without being late or defaulting on anything.

  76. bben46 says:

    I did basically the same thing several years ago. I had over $30K in debt after my business failed. It took me 5 years and I only heard of Dave Ramsey when I was almost finished. I no longer carry ANY credit card debt. My car is paid off. I don’t owe anything to anybody! Its a great feeling. I bought the Ramsey books for each of my adult children. I recommend them to everybody.

  77. VotaIdiota says:


    Who said anything about not having revolving accounts or recent data?

    Step 1: Open a few credit card accounts (ones with no annual fees, natch).
    Step 2: Use credit cards instead of cash (for items which you would be buying anyways).
    Step 3: Pay statement balance of credit cards before due date.
    Step 4: Get a nice healthy credit score, and accrue not one cent in debt, going about your shopping exactly as before with just a piece of plastic instead of pieces of paper.

    Lather. Rinse. Repeat.

  78. rjs34 says:

    The wife and I paid off 25k in student loans and 6k car loan in 12 months. I make around 50k a year from my day job and she is a SAHM. I took on part time jobs in the evening. It is nice being debt free.

  79. Coelacanth says:

    A thought to consider for everyone who hates the “debt snowball” method:

    For people with many credit cards with balances, keeping on top of payments and due-dates can be very tricky. Late fees are egregious, and they can also trigger Default APRs – which can be extremely costly in the long-run.

    Paying off small-balance cards can make financial sense if it reduces complexity. For those who have less-than-perfect credit, offers for low-rate BTs are probably hard to get in the present credit crunch. By having to keep track of fewer accounts, one reduces the risk of missing a payment and paying potentially catastrophic prices.

    Trouble with organisation is one likely reason some people became overwhelmed with debt in the first place.

    Yes, we can always blame the consumer, but nobody’s perfect, or people wouldn’t be in so much debt in the first place.

  80. cerbie says:

    OK, so he can pay off that debt in five months, when he is paying into his debt less than $100 per month less than I make. Dude, I am so impressed.

    Pandroid’s paying it down is impressive (also that he’s got investing on the mind, instead of spending more). The OP…not so much.

  81. @Orv: know your bank’s policy on accepting/rejecting overdraft transactions. I would guess BankAmerica is probably the most useless McBank you can possibly do business with, while your friendly neighborhood credit union is probably more user-friendly and more interested in keeping its MEMBERS (not customers) out of trouble.

    Here I go assuming everyone here uses CUs. My bad. My credit union, for example, offers credit cards at very reasonable rates, to which I could transfer balances while I’m trying to dig out. I might, at some point, fire Capitol One and get one of those. Heck, I might do it tomorrow on my day off.

  82. My wife and I are doing something just like this.

    The amazing thing is, after I cancelled my Amex Platinum card – which I never should have gotten in the first place – and replaced it with an Amex Blue card, which I then paid off, Amex is now hounding me to get a Gold Rewards Card. And today I got an invitation for … yup, a Platinum Card.

    Frack them.

    The one nice thing about Amex I can say is that the rewards points do eventually add up to something, unlike Discover’s cash rewards. I got about $300 worth of Home Depot gift cards out of my Amex misery.

  83. edosan says:

    Nothing like a story about people paying down credit cards to bring out the self-righteous losers.

    Yeah, he screwed up. Then he fixed it. Give the guy a break.

  84. halftank says:

    Big boo-yah for taking responsibility and paying off your debt.

    Never mind the douchebags – they should go pick on the folks who bought $700K homes while working as a cashier @Wal-mart and are now crying for a bailout.

  85. BigElectricCat says:


    “Someone didn’t read what I wrote.”

    No, I read what you wrote. I just didn’t agree with it. Simple as that.

    “It’s the internet – I don’t know why I’m surprised. I’ll say the first thing SLOW – you…don’t…need…debt…to…buy…a car… Save up and buy one…sheesh.”

    Rather than return your unwarranted rudeness, I shall simply capitalize the portion of my response to which you should be paying closer attention:

    ***If you ever plan to buy or REFINANCE a house or car, a better credit score will get you better rates.***

    Clearly, one must first have *financed* before one can *re*finance. Come now. Surely you recognize this.

    “A house is different. In my comments, I was referring to people (as I clearly wrote) that already have a house and education.”

    Irrelevant. Owning a house does not mean that one need never buy another (e.g. in the case of moving). Furthermore, homeownership does not obviate the possibility of refinancing (already mentioned above), whether one has a college education or not.

    “I’m fully aware one needs a CS to buy a house.”

    Just as you also recognize the necessity of a CS to *refinance* one, I’m sure.

    “I’m also fully aware that a high utilization rate negatively impacts your credit score. I never claimed otherwise – I just claimed if you weren’t going to go into debt again, it wouldn’t MATTER.”

    You made no such claim in the post to which I replied (see next post).

  86. BigElectricCat says:


    “My comments were tied together – don’t pull them apart into their individual parts and then claim it doesn’t work – that’s like sticking raw eggs in your mouth and claiming my cake doesn’t taste good :)”

    Um, no. They *weren’t* tied together. When I posted yesterday, your 3:58 comment was the only one I saw. I didn’t see your 4:37, 4:40 and 4:45 posts until I returned today. Had I seen them, I certainly would have taken them into account when posting my reply. In short, sir, your eggs tasted like eggs, and there was no cake in sight.

    “It’s very easy to refute somebody’s points when you frame them the way you want and take them out of context.”

    It’s also pretty easy to accuse others of misinterpreting your comments when they didn’t see them all. Do you presume ill will on the parts of everyone you meet online?

    “Your phrasing was correct, though, on the “managing” debt point – what I should have said is that a credit score is a measure is how good you are at staying in debt without being late or defaulting on anything.”

    Indeed. Thank you for that. However, what I think you think you should have said in your initial reply to me was something more along the lines of “perhaps I wasn’t clear. Allow me to clarify.”

    If you think I was rude in my reply to you, I apologize, as I intended no offense. However, I found your reply unreasonably intemperate and presumptuous. I don’t know how long you’ve been contributing to online communities like this one, but I’ve found that a little clarification goes a lot farther than confrontation when it comes to defusing online misunderstandings.

    Give it a try sometime. You might make some friends that way.