Hi J. - I really like Dave Ramsey but I disagree with him on this one, in part. His main objection is that it is easy to lose sight of how much things cost when we do auto withdrawal. He also thinks that if we set the minimum payment on a credit card, for example, we are less likely to pay more than that on auto withdrawal. He is absolutely on track there.
However, I think an excellent credit rating is even more important, especially in these financial times. I do as much as I can on auto-withdrawal and I pay online whenever I can. I save on stamps, checks and time. I am also assured that I never miss a due date. With that said, I also make sure I review my statements every month because errors can happen like this month when my cable bill didnt get withdrawn like it should have.
By the way, a dear friend learned the hard way about how easily we can lower our credit score. It was a good lesson for me and that's why I thought I would share it with you. She and her husband have good incomes and a perfect payment history but their credit scores tanked suddenly. She said it was because she consolidated all of their credit card balances onto one of those 0% intro rates cards and maxed out the credit line. Since the bureaus dont update in real time, it looked like she had her old balances and the new maxed out big one. She also paid only the minimum due on the new card for a few months. To the agencies, it looked like they were credit seeking and not able to pay even though the 0% interest rate would help them and in reality nothing much had changed. It triggered all kinds of things like their bank slashing the limit on their personal line of credit and even their car insurance premiums to go up.
The lesson was to avoid paying minimum payments for longer than 3 months and to not allow your balances to exceed more than 50% of your credit limit.