SIABC is honored to have Brad Chaffee from Enemy of Debt as a guest blogger. Please take the time to subscribe to his blog and review his website. www.enemyofdebt.com

When you were young do you remember people telling you to “build your credit”?
“You’ve got to build your credit score”, they’d say. You can’t go to school without credit. You can’t get a good job without credit. You can’t buy a car without credit. And finally, perhaps the one that started it all, you can’t buy a house without credit.

Sound familiar? Kind of reminds me of the famous Henry Ford quote.
“Whether you think you can or think you can’t – you are right”

Once you are convinced that you cannot have something without going into debt to get it that will remain true until you no longer believe the lie.

Once the banks created credit as the standard to consider financial responsibility, it was just a matter of time before the mindset above became reality for most everyone. The reality that in order to do and have anything at all, you must go into debt so that you can build your credit score and at last become financially responsible.

The days of saving to acquire anything significant would become a thing of the past. The new badge of honor was obtained through debt servitude and has ruined more lives than it has helped.

Think about it.

You don’t have to be a genius to look around and figure out that this has not worked. What it has done though is put good people in debt – and lots of it! It’s not that people purposely go into debt with the idea that it never has to be paid back. It’s that they have been brainwashed into believing that it was the only way to have things, not realizing a key factor, which is that life happens!

That’s right! Life happens, and it will happen to you too. It doesn’t care if you have zero or a hundred thousand dollars of debt. It does not discriminate.

I reject everything I have been taught about credit, credit cards, and the “almighty” credit score.

A system designed to judge your financial responsibility on the irresponsible decision to borrow money for anything and everything is a disaster waiting to happen.

Nowadays, people borrow money for EVERYTHING, and do so because they believe that they have to in order to have a good credit score! It has literally changed how people manage their finances and that is NOT a good thing!

Instead of work hard and save, the mentality to work hard and play “because I deserve it” has become the status quo. If you aren’t out there sipping coffee and having fun on plastic you must be a stiff. Live a little right?
Wrong!
I’ve got news for you and it’s going to sound like Tyler Durden’s advice in the hit classic movie Fight Club.

YOU ARE NOT YOUR CREDIT SCORE!

I haven’t borrowed money since the end of 2007 when I suddenly acquired common financial sense, and believe it or not, I’m still alive. I still have a roof over my head and against all odds; I have two paid for cars. Some would call me a whack-job.

I’ve been told by many that it is impossible to live without credit cards, car payments, and a big fat mortgage.

I check my score annually just to make sure there is nothing fraudulent going on. I was surprised to find that my credit score was 701. That would seem impossible considering all the talk about how to build credit these days.

Here’s how my family manages our money.

Our credit score can be zero or it can be a million — we truly don’t care! Since the end of 2007 we decided at that moment that we would no longer be making any financial decisions based on a stupid credit score.

We make decisions for our family based on what’s best, not on what our credit score may or may not do.

People say, “Don’t close your credit cards – don’t pay off that credit card – don’t pay your house off early”! For what? You guessed it; because the “almighty” credit score will fall.

Has anyone ever questioned how smart it was to keep a paid off card you no longer need to simply keep your credit score from dropping? Does it make any sense at all not to pay off your mortgage early?

The only logical conclusion I can come to is that we’ve been fed this lie not to keep our score from dropping, but instead to keep our interest being paid from dropping. Somebody benefits every time you believe this lie. Making payments over time to increase your credit score is laughable, and trust me, someone IS laughing — all the way to the bank.

According to ZenDough, if you master the six principles that will impact your VantageScore, you will “likely” achieve your goals.

Those principles are more likely to contribute to you staying in debt if you were to base your financial life on using them.

Those aren’t principles in my book — they’re pitfalls disguised as principles.

My advice to you would be to do the right thing with your money regardless of whether or not your score will rise or fall. If you have to go into debt in order to keep your credit score from dropping then it might be time to re-evaluate the real purpose of that score.

Is it intended to help you financially, or is it more accurately a way for you to make someone else very, very wealthy? Do you really want payments for the rest of your life — all for a stupid score?

You have to decide. I already have. Good luck.