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I think perhaps you don't understand because you presumably have a reasonable amount of money and cashflow buffer. It's hard to appreciate how much of a trap cr

I think perhaps you don't understand because you presumably have a reasonable amount of money and cashflow buffer. It's hard to appreciate how much of a trap credit cards are if you have very little money, or live truly paycheck to paycheck. Its so easy to accidentally run past your "$0" and be stuck in the world of 30%+ interest for a long time, spending multiples of the initial cost. As such, debit cards are still very popular for people who need to control every dollar, which is a lot more people than you think. Often folk would rather a transaction be denied than to go into expensive debt - they've been burned, they've learned the hard way.

akira2501 3y ago
Some banks used to "helpfully" give you a spot loan when you ran below zero balance. Some banks still charge you overdraft fees. Most banks charge you absurd fees for basic debit features. I see a lot of people using pre-paid credit cards. You can just roll into Walgreen's, flop cash on the counter, and "charge up" your card.
- dalyons 3y ago
  There are a lot of debit products out there. ButfFor the majority of traditional banks, if you turn off overdraft the account keeping fees for debit are far far less than the average carried CC interest bill. Those pre paid credit cards come with their own substantial fees, and usually are without rewards or purchase protections. I’m not entirely sure what you’re getting at?
  - akira2501 3y ago
    > Those pre paid credit cards come with their own substantial fees, and usually are without rewards or purchase protections. Having looked over a few the fees aren't any different than what you'd expect at a commercial bank like Wells Fargo. Many do come with rewards, often tied to the network of stores that issues them. Purchase protections aren't universal on standard cards. > I’m not entirely sure what you’re getting at? That debit cards aren't inherently safer than credit cards and this is reflected in the scope of available products.
    - PH95VuimJjqBqy 3y ago
      you'll need to define safer.
jjav 3y ago
> I think perhaps you don't understand because you presumably have a reasonable amount of money and cashflow buffer. Agreed. > debit cards are still very popular for people who need to control every dollar, But that's terrible advice. Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. You have $1000 balance and on the same day issue payments for $10, $20, $30, $40, $50 and $999. If the bank processes those in the same order you get hit with one overdraft fee when the final $999 payment goes through. But no, the bank will rearrange that to process $999 first, and hit you with five overdraft fees. So nice of them. I mean nice for them. With a credit card the payments are buffered away from your balance and you can choose when to pay it.
- nobody9999 3y ago
  >But that's terrible advice. Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. >You have $1000 balance and on the same day issue payments for $10, $20, $30, $40, $50 and $999. If the bank processes those in the same order you get hit with one overdraft fee when the final $999 payment goes through. >But no, the bank will rearrange that to process $999 first, and hit you with five overdraft fees. So nice of them. I mean nice for them. According to[0/PDF] the Consumer Financial Protection Bureau (CFPB)[1], reordering transactions in that way is illegal. [0] https://files.consumerfinance.gov/f/documents/cfpb_unanticipated-overdraft-fee-assessment-practices_circular_2022-10.pdf https://files.consumerfinance.gov/f/documents/cfpb_unanticip... [1] N.B.: The CFPB is a US Government agency. Edit: I'd clarify that I am not claiming that this sort of transaction doesn't happen, but rather that it's not a new issue and happens often enough that the CFPB felt it important enough to publicly opine about its illegality several years ago. Additional Edit: Added more context from parent comment to make their point (to which I certainly wasn't in disagreement) clearer. Apologies for any confusion.
- PH95VuimJjqBqy 3y ago
  > Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. In the US that's been illegal since the late 90's, you need to update your information.
PH95VuimJjqBqy 3y ago
I can tell you I make mid 6 figures and I still control every dollar. But you're absolutely correct, people act as if CC's don't have the inherent risk of going into debt, not as bad but similar to a pay-day loan. People throw around the word privilege, but it applies here.

akira2501 3y ago

Some banks used to "helpfully" give you a spot loan when you ran below zero balance. Some banks still charge you overdraft fees. Most banks charge you absurd fees for basic debit features. I see a lot of people using pre-paid credit cards. You can just roll into Walgreen's, flop cash on the counter, and "charge up" your card.

dalyons 3y ago
There are a lot of debit products out there. ButfFor the majority of traditional banks, if you turn off overdraft the account keeping fees for debit are far far less than the average carried CC interest bill. Those pre paid credit cards come with their own substantial fees, and usually are without rewards or purchase protections. I’m not entirely sure what you’re getting at?
- akira2501 3y ago
  > Those pre paid credit cards come with their own substantial fees, and usually are without rewards or purchase protections. Having looked over a few the fees aren't any different than what you'd expect at a commercial bank like Wells Fargo. Many do come with rewards, often tied to the network of stores that issues them. Purchase protections aren't universal on standard cards. > I’m not entirely sure what you’re getting at? That debit cards aren't inherently safer than credit cards and this is reflected in the scope of available products.
  - PH95VuimJjqBqy 3y ago
    you'll need to define safer.

jjav 3y ago

> I think perhaps you don't understand because you presumably have a reasonable amount of money and cashflow buffer. Agreed. > debit cards are still very popular for people who need to control every dollar, But that's terrible advice. Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. You have $1000 balance and on the same day issue payments for $10, $20, $30, $40, $50 and $999. If the bank processes those in the same order you get hit with one overdraft fee when the final $999 payment goes through. But no, the bank will rearrange that to process $999 first, and hit you with five overdraft fees. So nice of them. I mean nice for them. With a credit card the payments are buffered away from your balance and you can choose when to pay it.

nobody9999 3y ago
>But that's terrible advice. Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. >You have $1000 balance and on the same day issue payments for $10, $20, $30, $40, $50 and $999. If the bank processes those in the same order you get hit with one overdraft fee when the final $999 payment goes through. >But no, the bank will rearrange that to process $999 first, and hit you with five overdraft fees. So nice of them. I mean nice for them. According to[0/PDF] the Consumer Financial Protection Bureau (CFPB)[1], reordering transactions in that way is illegal. [0] https://files.consumerfinance.gov/f/documents/cfpb_unanticipated-overdraft-fee-assessment-practices_circular_2022-10.pdf https://files.consumerfinance.gov/f/documents/cfpb_unanticip... [1] N.B.: The CFPB is a US Government agency. Edit: I'd clarify that I am not claiming that this sort of transaction doesn't happen, but rather that it's not a new issue and happens often enough that the CFPB felt it important enough to publicly opine about its illegality several years ago. Additional Edit: Added more context from parent comment to make their point (to which I certainly wasn't in disagreement) clearer. Apologies for any confusion.
PH95VuimJjqBqy 3y ago
> Debit cards will debit immediately from your account and you may know that banks are very creative in re-ordering transactions to inflict you maximum pain. In the US that's been illegal since the late 90's, you need to update your information.

PH95VuimJjqBqy 3y ago

I can tell you I make mid 6 figures and I still control every dollar. But you're absolutely correct, people act as if CC's don't have the inherent risk of going into debt, not as bad but similar to a pay-day loan. People throw around the word privilege, but it applies here.