I’m a big fan of Ramit Sethi’s personal-finances blog iwillteachyoutoberich.com. It’s no secret that he spends everything on his credit card (paying it off every month) and is opposed to a cash-based budget. About 4 weeks ago, I read a transcript from a chat he conducted and found the following question and response:

Q: what do you think about not spending anything on credit cards? everyone else is in trouble so why not use cash only!”

For the past few weeks I couldn’t get this statement off my mind. It’s one thing to have a strong position ;-). It’s quite another to insult those who follow a perfectly legitimate and arguably superior system of financial management.

To resolve this issue, or at least let the blog-reading community decide for themselves, I challenge Ramit to a good-spirited showdown: Credit Cards vs. Cash. Ramit can present the credit-card arguments and I’ll present the cash/debit arguments. The readers on each side can also chime in. I read a similar showdown about productivity a while back and thought it was useful.

Please leave a comment and let us know what questions or views do you have about credit cards vs. cash? What questions would you want to see addressed if a showdown takes place?

If Ramit accepts we’ll decide the terms, time, and format. Let’s have Ramit express his spirited feelings in a more articulate and useful way.

Get Rich Slowly recently had a reader pose the following question:

“While I try my best to “get rich slowly” I have one huge issue: a husband. My husband likes to spend money. I’m referred to as the “Thrifty One Who Won’t Allow Me To Buy Stuff” and he’s referred to as “That Jerk Who Buys Stuff”. Do you have any advice for couples that need to have the other half put on a strict budget without making them feel like a child?”

I posted a comment at Get Rich Slowly in response, but I thought this excellent question deserved a more thorough answer, so here goes.

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My friend Clark once introduced me to the concept of the “deep mess.” A deep mess is one that gets worse before it gets better. Cleaning out a closet is an example of a deep mess. To get it cleaned out and organized, you first need to take every thing out. Then, once everything has been spread out and you can see what’s there, you can put it back in an orderly, organized fashion.

Starting a new personal finance or budgeting system can also be a deep mess. It will usually get worse before it gets better. But it WILL get better with consistent effort.

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For the next 2 or 3 posts, I will be addressing questions that have come up over the last few weeks. After posting the article about creating and managing a short-term emergency fund, I received the following question:

I was wondering if you could mention some practical ways of building a STEF; any advice would help, especially for those on irregular incomes.

There’s really no trick to building an STEF. It’s mostly a matter of focus and making it a priority. That being said, here are some ideas to help get you started.
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Since I wrote my post about “How to create a zero-based budget,” I’ve had a lot of feedback asking how to budget if you’re self-employed or your income is irregular or unpredicitble. For the most part, the process is the same regardless or how regular or irregular your income streams are. However, there are a few tips that will help take the bumps out of budgeting an unpredictable income and may even make budgeting a pleasant experience.

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