3 ms·

My card rate is and always has been 0 and it's the way it should be.

by jpablo 16y ago

jrockway 16y ago
Don't worry, you're still paying for it.
- CWuestefeld 16y ago
  This isn't obvious, but it's true. I pay off my cards every month (my wife is a fantastic money manager), so I don't pay credit card interest. But that's only the surface. Retailers have to pay to the CC companies a fee (it varies by card type, your processor, and what level of detail you provide to the company), something on the order of 2.5%. Even if you pay 0% interest on your card, you're still paying higher prices at retail in order to cover those card fees. I have a card that gives me 1% back. I wonder if that's enough to overcome the higher prices due to the card fee. I guess that depends on how many people are paying cash or PO, and my guess is that for most retailers that's a minority, so I'm probably paying more even in this case.
  - jimbokun 16y ago
    Try asking for a cash discount when buying things. A lot of establishments will do this, just to avoid the credit card fees.
    - gchpaco 16y ago
      At least a few years ago this was against their contract with the CC companies (which isn't to say people won't do it under the table, they'll just be quiet about it).
      - CWuestefeld 16y ago
        I don't think this is true. They're not allowed to tack on a CC surcharge, but a cash discount (while accomplishing the same thing) is OK.
        btilly 16y ago
        I didn't believe that cash discounts were OK, so I googled it and found http://fso.cpasitesolutions.com/premium/le/06_le_ic/fg/fg-merchants.html#C http://fso.cpasitesolutions.com/premium/le/06_le_ic/fg/fg-me... which verifies that you're right.
        gchpaco 16y ago
        Huh, you are in fact correct. I had stored in my brain the intended effect of the agreement but not the actuality.
  - dminor 16y ago
    Merchants pay higher fees on rewards cards.
  - lrm242 16y ago
    Of course even though you pay nothing for your card and get a cash rebate you also receive a service from your credit card company in the form of hassle free returns and dispute resolution. This is, IMO, worth the nominal carry over effect that it might have on retail prices.
BigZaphod 16y ago
As is mine. Why waste money on interest? If you don't have enough to pay for a thing, you shouldn't buy the thing.
- jrockway 16y ago
  I agree with you, and I think it's because we spend our money on technology. When you buy the latest gadget immediately, it just becomes obsolete. When you save up to buy the latest gadget, a better one comes out before you're done saving. So you get a better a gadget and have more money for more gadgets. I guess a lot of people want to have the "latest and greatest" for fashion reasons, and credit cards are appealing for that reason. I did that in college and it took me like a year of having a real job to pay it off. Sadly, other people never do pay it off.
- deleted 16y ago
  [deleted]

My card rate is and always has been 0 and it's the way it should be.

by jpablo 16y ago

My card rate is and always has been 0 and it's the way it should be.

jrockway 16y ago

Don't worry, you're still paying for it.

CWuestefeld 16y ago
This isn't obvious, but it's true. I pay off my cards every month (my wife is a fantastic money manager), so I don't pay credit card interest. But that's only the surface. Retailers have to pay to the CC companies a fee (it varies by card type, your processor, and what level of detail you provide to the company), something on the order of 2.5%. Even if you pay 0% interest on your card, you're still paying higher prices at retail in order to cover those card fees. I have a card that gives me 1% back. I wonder if that's enough to overcome the higher prices due to the card fee. I guess that depends on how many people are paying cash or PO, and my guess is that for most retailers that's a minority, so I'm probably paying more even in this case.
- jimbokun 16y ago
  Try asking for a cash discount when buying things. A lot of establishments will do this, just to avoid the credit card fees.
  - gchpaco 16y ago
    At least a few years ago this was against their contract with the CC companies (which isn't to say people won't do it under the table, they'll just be quiet about it).
    - CWuestefeld 16y ago
      I don't think this is true. They're not allowed to tack on a CC surcharge, but a cash discount (while accomplishing the same thing) is OK.
      - btilly 16y ago
        I didn't believe that cash discounts were OK, so I googled it and found http://fso.cpasitesolutions.com/premium/le/06_le_ic/fg/fg-merchants.html#C http://fso.cpasitesolutions.com/premium/le/06_le_ic/fg/fg-me... which verifies that you're right.
      - gchpaco 16y ago
        Huh, you are in fact correct. I had stored in my brain the intended effect of the agreement but not the actuality.
- dminor 16y ago
  Merchants pay higher fees on rewards cards.
- lrm242 16y ago
  Of course even though you pay nothing for your card and get a cash rebate you also receive a service from your credit card company in the form of hassle free returns and dispute resolution. This is, IMO, worth the nominal carry over effect that it might have on retail prices.

BigZaphod 16y ago

As is mine. Why waste money on interest? If you don't have enough to pay for a thing, you shouldn't buy the thing.

jrockway 16y ago
I agree with you, and I think it's because we spend our money on technology. When you buy the latest gadget immediately, it just becomes obsolete. When you save up to buy the latest gadget, a better one comes out before you're done saving. So you get a better a gadget and have more money for more gadgets. I guess a lot of people want to have the "latest and greatest" for fashion reasons, and credit cards are appealing for that reason. I did that in college and it took me like a year of having a real job to pay it off. Sadly, other people never do pay it off.
deleted 16y ago
[deleted]