Is Dave Ramsey Wrong? With No Loans and No Credit Cards, I Still Have a Credit Score.

by Joe Plemon on August 3, 2011

When Janice and I became gazelle intense about getting out of debt, we did so hook, line and sinker. Once we paid our credit cards off, we either quit using them or cancelled them. Over the years, I have sporadically checked my credit report, but had never become curious enough to obtain my official credit score.

However, because I have often heard Dave Ramsey touting his zero FICO score, and because it has been several years since I have used any credit of any kind, my curiosity finally got the best of me.  I, of course, took Dave’s claim with a grain of salt. After all, isn’t the minimum FICO score anyone can get something like 300? Still, I began to wonder: is my lack of any active credit hurting my score? If so, how much?

First: My Credit Report

Before giving you the details of my credit report, allow me to make a recommendation for those of you who will be checking your own credit reports: Save it as a pdf file. This is much easier to navigate than the multi-page printout I made last time. If, after you save the pdf file, you still want a printout, go for it.

So — here is the credit report info:

  • I have a credit history of 21 years and 9 months.
  • I have a total of one open account.
  • My most recent activity for that account is 01/2005.
  • I have a closed mortgage account because I made my last payment on 08/2004.
  • I also have 8 revolving accounts which are all “Paid and Closed”, some with the comment “account closed due to inactivity.”

Now: My Credit Score

With only one open line of credit, and zero activity in six years and eight months, what is my credit score?

Drum roll please:   801.

But wait! This isn’t a FICO score. It is something called a VantageScore Report (from Experian). “What is going on?” Evidently, both Experian and Transunion are now issuing VantageScores instead of FICO scores. Who knew? Well, actually, anyone who has recently checked his credit score.

What does VantageScore of 801 mean?

According to the report that was included with the score, I am rated a “B”. My credit category is Prime Plus (but not Super Prime) and I rank higher than 61.64% of U. S. consumers. I could, according to this report, improve my score by having “more open, recently reported accounts as part of my credit history.” In addition, “having open, recently reported bankcard accounts as part of my credit history can have a positive impact on my credit score.

How does VantageScore compare with FICO?

This is a very pertinent question because (according to my understanding),  Experian gives consumers the VantageScore number while giving potential lenders the FICO number. Not that I plan to borrow any money, but wouldn’t it be nice for consumers to see the same number that the lender is looking at? Because the top VantageScore is 990 while the top FICO is 850, I suppose I could estimate my FICO score by taking 86% (850/990) of my 801 score, which would give me a pro-rated FICO score of 688. For sake of comparison, I tried the FICO Score Estimator from After answering 10 simple questions, I learned that my estimated FICO score is 725 – 775.   Hmmm.

Am I going to work toward improving my score?

Naw. To do so would mean either borrowing money or using a credit card, and I am just too content (and hard headed) to change how I do things. My wife and I love our cash envelope system; we don’t like credit cards (although we each have a debit card) and we disdain debt of any kind, so we will keep on doing what we have been doing. I know: my credit score could eventually cause a hike in my auto insurance premiums, but I have been monitoring those rates for some time and have seen no obvious jumps.

By the way, I would like to point out to my credit card user friends that I never said a single word in this post which remotely implies that I think you should do anything differently. Personal finance is personal, and if you do well by using your credit cards, I applaud you.

They just aren’t for me.

Readers: how often do you check your credit report?  Your credit score?



{ 19 comments… read them below or add one }

Alex Humphrey August 3, 2011 at 4:33 pm

Really interesting. I’ve never checked my credit score, but I do check my credit report yearly. It’s about time for me to check my wife’s, actually.

I just paid off my last debt earlier this year (well, my parents did – it was a student loan I let them take out in my name; by God’s grace that worked out) and I am interested to see what happens over the next year or two.

However, I don’t have any credit lines still open. Do you think your single credit line could be skewing the number up? With that line of credit you are still hitting 4 of the 5 items necessary to have a credit score.


krantcents August 3, 2011 at 4:43 pm

Although I never had a problem with debt, I am totally unconcerned with my FICO score! My reasoning is I handle my credit responsibly and unless some one steals my identity my score will be good. No surprise, it is good.


joeplemon August 3, 2011 at 5:06 pm

@Alex — Good point that my one line of open credit could be skewing the number up. I suppose I will find out once that one gets closed due to inactivity. I will be sure to check my score when that happens.

@krantcents — Historically, I have been just like you…no debt or very little debt and totally unconcerned about my FICO score. However, as I said in the post, I became curious if my lack of using any credit whatsoever was affecting my score. Curious? Yes. Concerned? No.


Eloisa @ Travel Wisconsin August 4, 2011 at 12:36 am

You made the right decision my friend. It feels good to live a life free from credit cards. For me, no credit cards, no problem.


ella August 4, 2011 at 3:20 am

Must be nice not having a credit card 🙂 I have one but make sure to pay it off entirely by the end of each month, i’ve been in debt and hated it. but i am considering of quitting credit carding 🙂 so thank u for this post


Mike @ Credit Card Forum August 5, 2011 at 4:18 am

“Personal finance is personal, and if you do well by using your credit cards, I applaud you.” You know me Joe, I am totally with you… the truth is there is no one size fits all. For some people credit cards make sense, for others they don’t. Your system works for you, so stick with it!

Re: Vantage Score, an 801 would be a “B”

A: 901–990
B: 801–900
C: 701–800
D: 601–700
F: 501–600


Ravit August 5, 2011 at 5:41 am

I am also considering of quitting credit carding! As people we love to have habits but this one becomes a debit!!


Efrem Jackson August 8, 2011 at 1:01 pm


Loved the post. I have been working in the financial services industry and teaching faith based financial principles for several years. I’m endeavouring to start my own financial ministry and blog and would love any suggestions or tips you might have


joeplemon August 8, 2011 at 3:39 pm

@Mike — Thanks for the Vantage score sheet. I am just barely a “B”!

Effrem — No great words of wisdom other than read, read and read more. Anything by Randy Alcorn, Larry Burkett or Dave Ramsey is good stuff. Also, check out Money Help for Christians and Christian PF blogs.


Dave@50plusfinance August 13, 2011 at 4:21 pm

Very interesting topic. I wonder if it will take longer to go to zero. If not give Dave Ramsey a call and complain. I wish Dave would actually post his actual credit report to show us it is possible. It would be interesting to see his credit history.


joeplemon August 15, 2011 at 8:38 am

I have heard DR claim to have a zero credit score, but I also heard him say that FICO told him it was indeterminable because of insufficient data. As far as his credit history, I am sure that there is nothing to see because he hasn’t used credit for so many years. Believe me: if Dave Ramsey were to borrow money, someone would leak the news and it would be BIG news.


Nicole August 20, 2011 at 8:31 pm

We only see our credit score when we’ve refinanced the mortgage!


joeplemon August 24, 2011 at 10:49 am

Nicole — really? I don’t know why these credit bureaus started giving us faux scores in the first place.


Jamie December 29, 2011 at 2:01 pm

Dave Ramsey is correct. If you go long enough without using any credit cards, no mortgage, no debt, no collections, you will simply not exist. You will get a letter just like he did telling you that there is not enough info to create a score. FICO and the rest are a joke. It takes into account information that is wrong or irrelevant and doesn’t take into account important information.


joeplemon December 30, 2011 at 9:11 am

Hmmmm. Maybe not existing in FICO’s eyes is not altogether a bad thing. I suppose, as you said, I will some day find out.


Michael A Starlard May 4, 2012 at 8:15 am

Do I have a credit score after being out of the country for over
15 years.


Joe Plemon May 4, 2012 at 8:54 am

Probably. Go to for a free credit report. You would need to pay for your actual credit score (like I did).


Lucas August 14, 2012 at 11:13 am

This is one area I definitely disagree with Ramsey on. Not having a credit score, is simply a bad idea. Scores are used to determine what you pay for insurance, are often used by employers (especially the government), landlords, and as pointed out, when obtaining new credit. These days I list a credit score right along with emergency savings, insurance, and debt reduction, it is an essential part of financial stability and mitigating risk.

You can build your score without carrying debt. Simply automate it. Use the card to pay for say, your utilities, then have your checking account automatically pay the card off after the bill is generated. Very easy to do and having one or two active active cards (open and in good standing) can and will do wonders for your credit score, without having to pay a cent in interest.

Those who claim they don’t need a credit score will wish they had one when the have to move, are looking for new employment, and when their insurance costs continue to increase. Ramsey may be able to afford to pay the difference, but most of the clients I work with cannot.


Joe Plemon August 18, 2012 at 2:29 pm

Great points. I especially like the idea of using a card to make payments and then having those payments automatically paid from your checking account. True confession: I didn’t know that could be done. You said it is easy to do. Could you take a few minutes to explain how to set this up? Thanks!


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