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How credit card rewards became a $9.2B wealth transfer

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Re: How credit card rewards became a $9.2B wealth transfer

#301

Post by aurareturn »

red-iron-pine wrote: post #264
aurareturn wrote: post #6

I always wondered why people in America would ever pay by cash or credit card - unless they are laundering that cash. Otherwise, you're giving up 1-3% discount. Set auto-pay on your credit card to pay in full every month. I've never once paid for credit card interest. I think there's a term inside credit card companies for people like me: leeches or something like that.

> I think there's a term inside credit card companies for people like me: leeches or something like that. that's some odd classism there. credit card companies love your data . they can package it, sell it, analyze it. this is real data of actual behavior, not whatever people say or click -- money where the mouth is. even if they never make a cent off of you from an interest perspective they 1) still get fees from th…

FYI, Chase Sapphire Reserve made their rewards drastically worse recently. They were losing money on people like me.

Re: How credit card rewards became a $9.2B wealth transfer

#302

Post by strix_varius »

aurareturn wrote: post #300
strix_varius wrote: post #12

Earlier quoted context omitted.

This presupposes the ability to get a credit card and the confidence of sufficient funds when that auto payment hits.

confidence of sufficient funds when that auto payment hits How is this different than paying with cash or debit?

Because cash and debit allow you to pick the time in the month when you happen to have the ability to pay for something.

Frankly these questions astound me, do y'all really know no low income folks?

Re: How credit card rewards became a $9.2B wealth transfer

#303

Post by strix_varius »

sokoloff wrote: post #17
strix_varius wrote: post #12

Earlier quoted context omitted.

This presupposes the ability to get a credit card and the confidence of sufficient funds when that auto payment hits.

If the alternative was paying cash, cash has an even more demanding level of confidence of sufficient funds required and it applies earlier with no flexibility.

No it applies at whatever time you choose - it's the most flexible option for a person whose wealth fluctuates frequently around a low baseline.

Re: How credit card rewards became a $9.2B wealth transfer

#304

Post by OptionOfT »

ChrisMarshallNY wrote: post #16
aurareturn wrote: post #6

I always wondered why people in America would ever pay by cash or credit card - unless they are laundering that cash. Otherwise, you're giving up 1-3% discount. Set auto-pay on your credit card to pay in full every month. I've never once paid for credit card interest. I think there's a term inside credit card companies for people like me: leeches or something like that.

I paid a lot of credit card interest, as a yute, but, since getting married, I have paid in full. Been over 30 years. Leeches rule! At one time, credit card companies forced vendors to charge the same, whether cash or credit, but that seems to have fallen by the wayside. The problem is, is that cash is becoming less and less acceptable. In a nearby town, you can't pay for parking, with cash. I have seen credit-card-o…

> At one time, credit card companies forced vendors to charge the same, whether cash or credit, but that seems to have fallen by the wayside.

I miss that. I really dislike that it is allowed to charge extra for a credit card. It shows that the company doesn't understand the cost of cash.

Re: How credit card rewards became a $9.2B wealth transfer

#305

Post by Hikikomori »

joenot443 wrote: post #276
stefanfisk wrote: post #241

Earlier quoted context omitted.

I’m in Stockholm, and our condo HOA (BRF) includes 1Gbps per unit in the fee for all units because billing individually would cost more in admin than the service itself. We have FTTP and then cat6 to each unit.

That sounds really convenient! Is it a new building? I know the odd American or Canadian build will have that, but only the newer and more expensive ones.

I had that in Sweden 20 years ago. Typically our local municipality put fiber whenever they dug up anything, so fiber is everywhere.

Re: How credit card rewards became a $9.2B wealth transfer

#306

Post by Hikikomori »

AnssiH wrote: post #47
criddell wrote: post #14

Earlier quoted context omitted.

How generous are credit card rewards in the EU?

My understanding is that they are much less generous on average compared to U.S. E.g. for now I have the most premium card offered by my bank (50€/mo), and it gets me extra product insurance, rental car insurance, travel insurance, free lounge access, and some other things like that, but no cashback or similar. I think some premium cards do offer cashback nowadays, but they are in the minority. Some cards also offer…

US are not generous either. Merchant increase prices by 5% to cover costs, you get 2.5% cashback and visa/your bank pockets the other 2.5% you're paying.

Re: How credit card rewards became a $9.2B wealth transfer

#307

Post by internet2000 »

amiga386 wrote: post #84
internet2000 wrote: post #30

Earlier quoted context omitted.

Prices don't go down, they only ever go up. There is no situation in which interchange fees get slashed and prices go down across the board by 3% to make it worth it for card users.

Prices do, in fact, go down. For example, eggs in the USA went down from $6 to $2 in the past few months. https://www.macrotrends.net/3052/us-egg-prices Long term average? Sure, it goes up, that's inflation. But do you know what causes inflationary pressure? Visa and MasterCard adding unjustified fees because they're a duopoly and control most of the payments market, and your government won't regulate them and cap fe…

> Long term average? Sure, it goes up, that's inflation. But do you know what causes inflationary pressure?

An economy that relies on growth, yep.

Re: How credit card rewards became a $9.2B wealth transfer

#308

Post by ponector »

ramijames wrote: post #121
nsedlet wrote: post #31

Credit cards also transfer wealth from people who pay interest to people who don’t. It’s a silly system, where everyone has to invest their time (optimizing for rewards, avoiding interest) in an ultimately negative sum game. I hate it so much.

I'm 46. I've never had a credit card. I have a bank account and a debit card. If I can't afford something, I don't buy it. You can just opt out of using credit cards.

If you are traveling and need to rent a car in the airport - sometimes it is not possible to do without credit card. Otherwise you don't need a credit card.

Re: How credit card rewards became a $9.2B wealth transfer

#309

Post by ButlerianJihad »

ponector wrote: post #308
ramijames wrote: post #121

Earlier quoted context omitted.

I'm 46. I've never had a credit card. I have a bank account and a debit card. If I can't afford something, I don't buy it. You can just opt out of using credit cards.

If you are traveling and need to rent a car in the airport - sometimes it is not possible to do without credit card. Otherwise you don't need a credit card.

Using a credit card makes it way, way easier to rent a car or book a hotel room, or do other transactions that require a significant preauth.

If you present a debit card to one of those desks, they may encourage you to swap for a credit card. Because a debit preauth ties up actual funds in your account. A credit preauth costs nothing but part of your credit limit. It really is a difference if you expect to spend money on vacation.

Re: How credit card rewards became a $9.2B wealth transfer

#310

Post by ant6n »

losvedir wrote: post #197
nerdjon wrote: post #155

Earlier quoted context omitted.

I gave up long ago trying to optimize any rewards, it just ended up being stressful and not really worth it ultimately. Now I just use my apple card everywhere, pay it off every month and get whatever rewards I get. It feels like a weird situation, those that stand to gain the most from credit cards are also the ones that should feel a difference of under $100 in rewards the least. The one exception I see is bonus si…

The rewards differences can be significant. Eg 4% vs 1% cash back is $3k difference on an annual spend of $100k. On the one hand, relative to our income it's not so important, but on the other it feels bad leaving $3k on the table.

How do you spend 100K on a credit card per year? Do you pay housing with the card?
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