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Billionaire entrepreneur Mark Cuban suggests paying all your credit cards and then burning them.
“If you use credit cards, you don’t want to be rich,” Cuban said in an interview with personal finance expert Dave Ramsey on “The Ramsey Show.”
The biggest problem people have with credit cards is high interest rates, he told Ramsey.
The average interest rate for a credit card is around 16.65%, according to the latest Federal Reserve data, and some cards can have rates as high as 36%, according to WalletHub.
“Credit cards aren’t your friend,” Cuban told CNBC Make It. “Debit cards are good if there are no fees,” he adds.
If you don’t pay the balance in full, interest continues to accrue, Cuban says. He suggests that when you need money, you should opt for a fixed rate consumer loan.
“It’s better to get a personal loan as an alternative to a credit card,” Cuban suggests.
