Who Actually Pays For Credit Card Rewards?

[@CreepahKillahRSA]

To put it simply: don’t spend money you don’t have, and always pay off your monthly debt in full.

[@shannoncargo468]

Couldent have said that any better

[@CreatingAlong]

How do people not understand this?

[@28ebdh3udnav]

​@@TobiasRieperGood that's the problem with people who intentionally take out the CCs and intentionally don't pay back because they will treat it as "free money". I know, because my mom admitted to me that it's that manner how she got us clothes when we were kids. She didn't work, my dad was the only one working but roughly half of the income was going for Child support, and she would take out credit cards at department stores, banks, and never pay it back. It's people like my mom who makes it worse for the others. Now, fast forward to 2019. When my mom lost some of her job, she used my credit card for necessary purchases. Food, gas, groceries, medicine, etc. That's it. She racked up charges up to 2100. Over the span of 2 years, beginning of 2019 to end of 2020, she used it like crazy and when it was finally closed, I told her to start paying it back. She kept lying that she was making the minimum payments. I kept telling her, over and over again. Then once it was closed, she told me not to worry because she will pay it back, "eventually" again and again. Then, she denied ever using it so much and called me a liar for bringing it up. I logged into my bank account online, and she validated all the charges except for one. And again, I told her, "okay, now that we know that you didnr actually pay back anything, and you are the that mostly used it, start paying ". And she changed her tone to, "why should I pay for it? It's not my credit card ". So here I am, almost 3 years later, almost done paying that crap all because she knew that if I didn't pay for it for the next 4 years or 5, it would be removed from my credit report

[@asianguy86]

@@CreatingAlong simply use debit cards

[@LastNameTom]

​@@28ebdh3udnavI agree. But you have to look at today's world. Prices on everything are skyrocketing. You have to put food on the table, you have to buy gas, you have to pay the ridiculously high rent and mortgages. What are you going to tell the person who can't afford to buy groceries under the Biden s inflation with cash? You're going to have to put it on a card. And when promotions in the US are averaging 3%, and inflation is over 11%, it's hard to tell the majority of Americans not to get a credit card.

[@adamduvick]

“If everyone made the rationally correct decision at every point, the banking industry would probably not exist.” Profoundly true.

[@truechaosmulala3831]

Well not necessarily they just would be in a different form mainly keeping money safe from theft and crime instead of as a lending business

[@AshutoshKumar-es8xy]

“If everyone made the rationally correct decision at every point" forget banks there would be no wars, no famines no crimes, no inequality. Hell we would make so much progress that we won't even need to work , robots will be advanced enough to do everything, the progress of civilization would be so exponentially crazy we can't even imagine.

[@kingdeedee]

Quote should’ve said “the banking industry *as we know it* would probably not exist.” There are plenty of other ways to monetize these things and if institutions were making less off credit cards, they’ll just find other ways to make the money

[@safeandeffectivelol]

@@AshutoshKumar-es8xy You're talking about a utopia that doesn't exist and never will. What is rational to one person is irrational to another.

[@checkthelogic]

True!

[@kenfrancis117]

I treat my credit cards like debit cards. I spend only what I know I have, and pay my credit card off in full.

[@AnonUnited]

Exactly. I've never paid a cent in interest in my entire life because I only spend what I earn.

[@alles_klar]

@@AnonUnited "What they don't want you to know: avoid interest with this one simple trick!"

[@kaym7704]

This is the way.

[@rudistorm3348]

True. But I do think people spend more on cards than they would with cash. Also a friend of mine has been overcharged 3 times on a card at Buffalo wild Wings. A lot of servers will alter your tip amount. BEWARE.

[@t500010000]

I used to not understand credit cards too. This is why most poor folks stay poor

[@alexsteven.m6414]

Credit card rewards are funded primarily through merchant fees, interest charges, and consumer spending. It's crucial to use credit cards wisely to benefit from rewards without accruing unnecessary costs. How do you typically approach managing your credit card usage and rewards during economic uncertainties?

[@fresnaygermain8180]

Currently, my primary focus is exploring avenues to increase income amidst periods of quantitative easing, as I cannot afford to see my savings dwindle.

[@edelineguillet2121]

true, A lot of folks downplay the role of a professional until being burnt by their own emotions. I remember couple summers back, after my lengthy divorce, I needed a good boost to help my business stay afloat, hence I researched for license advisors and came across someone of due diligence, helped a lot to grow my reserve notwithstanding inflation, from $275k to approx. $850k so far.

[@bernisejedeon5888]

How can I contact your Asset-coach as my portfolio is dwindling?

[@edelineguillet2121]

There are a handful of experts in the field. I've experimented with a few over the past years, but I've stuck with ‘’Sharon Marissa Wolfe’’ for about five years now, and her performance has been consistently impressive. She’s quite known in her field, look-her up.

[@yolanderiche7476]

Interesting. I am on her site doing my due diligence. She seems proficient. I wrote her an email and scheduled a phone call.

[@mzr5165]

You need to use a credit card like a debit card. If you carry a balance except for large planned purchase, you're gonna have a bad time

[@JT-bs8wz]

Close. Credit cards should be used like checks, with balancing the checkbook at checkout. Cards as a whole allow for far too painless spending.

[@chrisl9350]

Yup only spend money you have when you have it to spend

[@asianguy86]

@@JT-bs8wz simply use debit cards

[@leimedowntonight]

@@asianguy86 Expand on that suggestion please. Credit cards are safer in cases of fraud, when you use debit, money is automatically deducted to your account. And you have minimal to zero chance of retrieving that.

[@asianguy86]

@@leimedowntonight if my credit card details are stolen it's easy for anyone tu buy anything from it 😒😒😒

[@HomebaseLHR]

My Amex limit is about $7,000 a month. I’m fully aware I could not afford that level of spending, so I only spend about $600-$700 a month because I know I can afford to pay it off, in full, every month.

[@asianguy86]

simply use debit cards

[@HomebaseLHR]

@@asianguy86 don’t get the points/miles on debit cards.

[@DickCheneyXX]

@@asianguy86 That is a terrible advice. Why gimp yourself like that?

[@stetson999]

@@asianguy86 classic example of someone that hears the negative aspect of something and falsely declares they thus have no purpose. If you use credit responsibly, it’s completely nuts to only use a debit card.

[@asianguy86]

@@CheekyBird790 you will rot in credit card debt 🤣🤣 my white neighbours who mock me are already under heavy debt 🤣🤣🤣 in our locality half of families are infected with credit card debt since yrs and 🤣🤣 are running paycheck to paycheck

[@morganmac-smith5526]

I am blue collar, I make $700+ in rewards annually and have never paid interest. I think financial literacy is the key.

[@deprecor1]

very true, I lived on $25-30K per year for 7 years and still accrued $200 yearly on cashback. You should never carry balance on a credit card!

[@TheNachoDaddy]

You absolutely nailed it! I have friends and family with $200k (and higher) household incomes, but they are constantly broke because they are over-leveraged with debt. It really has nothing to do with how much you make.

[@angiepatterson6338]

Yes but poor people stay poor because they are too stupid to understand that.

[@moose354]

The banks have a name for me. They call me a FREELOADER. Am I insulted? No. They call me a freeloader because I take the welcome bonus, takes the points and miles and never pay interest charges. I love being a FREELOADER. My wife and I flew to Europe three times last year in business class by cashing in miles. I'm PROUD to be a FREELOADER.

[@LegIIAVGCA]

Yep! Same here. I generally pay off my Costco Citibank off each month but if I cary a balance, the next two months I pay “average balance” the next 2 (two) months of interest is due even if I pay off next payment. So there goes $80 in interest with $3000 balance

[@TheNachoDaddy]

Hey, well done. The banks expect customers to make bad decisions and accrue debt so they can rake in the interest revenue. You and other smart consumers are simply their cost of doing business.

[@FrankieHyman]

Actually they have another name for people who pay off their balance every month. DEADBEAT believe it, those that carry balances are not.

[@bitesizedtunes6783]

Your not there ideal customer lol

[@pkmachinegun]

People in credit card debt got a credit card without knowing how to use it. It’s an education issue, not a credit card issue. I had a bankruptcy because I was stupid and didn’t know how to use credit, then I learned and now I’m raking in rewards with no problems.

[@stevenluo9516]

So what's financial literacy again? Never heard of it.

[@thatguythere98]

​@@stevenluo9516 By paying just the minimum or simply less than the total you get charged interest which far outweighs any benefits the cards have. Never spend money you don't have and pay it off completely the next month, and at the same time use it for all your purchases. That's it. Then you can get get higher tier cards with yearly fees but even greater rewards or get cards with no yearly fees to get the sign up bonuses.

[@andy68686]

Credit cards is for those whose money is better invested elsewhere, not to buy things they can't afford.

[@Dangic23]

No education needed to use a credit card.

[@stevenluo9516]

@@Dangic23 Indeed, and that's where the fun starts for me hehehehehe :D

[@thirteenthhour370]

I went in-person to my bank to ask some questions about a new rewards card they were offering. I must have come off as a little clueless because the employee I was speaking to had this moment where he looked at me for a long second, covertly checked where his boss was, and told me quietly, "The bank only wins when you fail. They are expecting you to fail." I personally did not need that warning, but he made a judgement call about my financial literacy and instead of selling me on the card, he tried to protect me. Thank you, bank dude.

[@caskettsolo7925]

This is very uplifting to read. Glad there are people who don't take advantage even when they're at a beneficial position.

[@NareshJain]

Things that actually happened 😂

[@cardojp]

Learn how to lie better

[@walterpreston9663]

Simply pay it off at the end of each week……… if you know you won’t have the money, stop spending over the amount you earned.

[@ExhaustinglyBored]

You don't always know you won't have the money. With a lack of workers rights we can lose our primary (maybe only) source of income

[@williamhaynes7089]

@@ExhaustinglyBored i have not had an issue in 51 years... even with no new workers rights

[@thunderb00m]

@@ExhaustinglyBored this is an issue worth fighting for but please have an emergency fund

[@ExhaustinglyBored]

@William Haynes 51 years? Oh so you started when workers rights were decent and just starting to be stripped away

[@brandonjamar]

if only we lived in a perfect world and everything was actually this simple.

[@UnfilteredCactus]

This is not a credit card issue, this is a user error issue. Knowing how to leverage debt and maximize the rewards of a credit card is very profitable.

[@umani9983]

Wouldn't call it profitable because everyone is still paying the bank for credit card transaction fees that are built in to the sell price. Getting rewards is merely offsetting those hidden costs.

[@stetson999]

@@umani9983 you’re paying those higher costs whether you use a rewards card or pay cash. So why in the hell would you not want to get something back for it?

[@umani9983]

@stets I agree and I use credit cards for that exact reason. Just saying we are not really "profiting" anything because people would be lucky to simply recuperate the cost.

[@whitestrips1]

@@umani9983 Do you honestly think that if interchange fees were lowered, the merchants you are shopping at would also lower their price? It's not realistic and as a consumer you are certainly "profiting" from using a good reward card vs. not using any. The so called "costs" you are referring to would still be paid regardless.

[@umani9983]

@whitestrips1 yes it would be lower. There are shops that charge different price if you pay with debit or cash. Very few of those now but there used to be more of them.

[@saulgoodman2018]

I never once paid any interest in 20 years.

[@michael7054]

I'm 40 in ohio and never even had any credit card debt.

[@ninoskaramosmiguel9704]

you actually have to be brainless to pay any fee in credit cards..

[@aaryamanpiplani5672]

How's prison , Saul ?

[@pensacola321]

​@@michael7054 oHIo..😂😂

[@michael7054]

@@pensacola321 O! H! I! O! 😆

[@nicksmith8141]

I alway pay all cards off in full. I keep them all on autopay, but I keep track via a spreadsheet to make sure I don't overspend. I had a record amount of cash back this year and work actively to maximize our cash back/ travel points from month to month on basic purchases.

[@uweschroeder]

Sadly, even with the cash back you get, you'll never make up for what the merchants charge you to accept cards in the first place.

[@madhavbss307]

If I am not wrong, There are apps available on Play Store or Apple Store where you can add your credit cards and the app will track everything for you which makes it easy for anyone to payback in time. Creating spreadsheets is now too old school isn't? I myself use one of the apps but I am not sure if it supports the USD or the American market tbh.

[@anonymous00117]

​@@uweschroederanother case of an ignoramus pretending to be informed

[@uweschroeder]

@@anonymous00117 Do you have merchant accounts? I do. So I know what they charge and I know what I add to my products because I ain't paying the merchant account fees. You really think a bank will give you more cash back than they charge you in the first place? LOL.

[@UArcane-b3x]

@@anonymous00117are you upset because it’s true?

[@septimus__Prime]

Don’t even look at the credit limit. You should know how much you can afford monthly, so you can pay it off weekly or by the end of the period. If you can’t pay off the card, then you should use cash or debit card.

[@candy2325]

Agreed 👍 I’m not flattered when they raise my credit limit .. because it’s not my money anyway lol. I put my fixed expenses and pay it off weekly

[@ZePopTart]

You should look at it a little bit and try to stay below 30%. Even if you can afford it, credit utilization is a big part of your credit score and over 30% starts to negatively affect it.

[@DickCheneyXX]

You should always be bellow 30% and especially 50% of your limit for credit score reasons. It don't matter if you have 3 times your limit in your checking account, you will still be docked for "over-leveraged CC".

[@braceyourselvesfortruth2492]

@@ZePopTart I would suggest below 10%. I went from 17% to 8% utilization and my score went up 25 points. The only other issue hurting me is inquiries, and none of them had fallen off yet.

[@ZePopTart]

@@braceyourselvesfortruth2492 if practical, sure, couldn’t hurt. My starting credit was like $500 though. I couldn’t charge half a weeks groceries without going over 10%.

[@YoSpiff]

I got in trouble with cards many years ago when I was living paycheck to paycheck. I only owed $2-3,000 USD, but it was still a struggle to eliminate them. I cut up my cards and closed the accounts. I now have a job with a lot of travel. For the first several years, I could only get $350-500 credit, so had to keep some cash in a separate checking account to cover work travel. My credit then improved from lousy to great over a 3 year period. I do use a card with a cashback reward for travel and I pay it off before the due date. So I make a few hundred $ a year. But I am at a point in my life where I can afford to pay it off. I am well aware of the trap because I have been there. It isn't designed for the benefit of the consumer.

[@YadraVoat]

Were you aware you can cut up the cards without closing the accounts? (At which point they continue to improve your credit score as they age. You get at least a year of positive feedback from most all issuers during inactivity before the account automatically closes, sometimes three.)

[@TonyTheYouTuba]

Yes I got into debt when I was younger too. Nowadays I have several credit cards, but I don’t even look at what the credit limits are because it’s not relevant. I’m only going to spend money I have and can afford to, so that’s the real limiting factor.

[@alexapuerta]

​@@YadraVoat Don't close ever close accounts or let them close due to inactivity. Make a small purchase every 4-6 months to keep the account open. I buy $1 Amazon gift cards with accounts I don't use anymore. It gives me many thousands of more dollars of credit availability, thus lowering credit usage and debt:availability/utilization ratio, while continuing to increase the length of my accounts. All of these contribute greatly to credit score.

[@mikejanacone8328]

Yeah, you do lose money using a credit card as opposed if someone’s paying you in cash as a merchant but you have to understand this now there is a cost of cash. There’s a risk of theft cost of cash delivery services, and the time and energy cost of employees/owner to correctly organize and process the cash correctly credit cards alleviate that you have to take that into consideration as a merchant

[@adon8672]

Can't debit cards do the same?

[@mikejanacone8328]

Yes, your bank debit card account is the same as a credit card I was making a comment about it really doesn’t cost retailers any more money to do card transactions as opposed to cash. It basically almost breaks out to be the same.

[@venkate5hgunda]

Uhhh, no. Debit cards don't charge a percentage of transaction. They charge a standard fee, whereas a credit card is a percentage. Makes a huge difference. Debit cards are much better. In fact, using credit cards as if they're debit cards is the best in my opinion to get those Rewards too. This is why in India, a lot of the merchants only accept debit cards because of the ridiculous fees

[@Watch-0w1]

There debit card with cash back reward

[@Kwijibob]

​@@venkate5hgunda That varies depending where you are. The % on debit cards is far lower where it exists

[@ISpitHotFiyaa]

The problem is there's nothing merchants can do about the interchange fees except not accept credit cards. The credit card companies can thus charge pretty much whatever they want for those fees and obviously the business is going to pass as many of those on to the customer as possible. The only thing the customer can really do about that is get the card with the best rewards. The banks actually do compete on rewards and you might even be able to come out ahead on the interchange fees if the rewards are high enough or if you have multiple cards and are able to max out the rewards categories on each of them.

[@nachiketpatil9338]

In short its not free. We pay indirectly for these points!

[@TheLordoftheRavens]

That is true, but it's not really a problem. If the interchange fees were really too high for merchants, then they really would stop accepting cards from that network. In fact, that already does happen all the time in real life. Think about how many merchants (particularly small businesses) don't accept AmEx (which has the highest interchange fees on average). So credit card companies have to be wary of not charging excessive fees, because merchants will actually stop accepting those cards. Also, there are plenty of merchants (again, often small businesses) who charge different prices for people paying with a credit card vs. cash. For example, the cash price is $10 while the credit card price is $11. That incentivizes customers to pay in cash, because it's less money out of their pockets.

[@flfloful]

This is why there are no reward card in europe. Interchange fee is capped at 0.5% by law. It makes it impossible to offer 4% cashback.

[@GMProspect]

Merchants can offer a 3% discount for cash if the interchange fee is 3% and still accept cards

[@HighlandUrgentCare]

I have a company called Signpay where the terminal adds 3.5% to each person using a card. This is Georgia and many states allow this. Many people see the sign and opt to pay in cash...all good with me....I am small office medical. Made 32k back first year I did this

[@MrDietsam]

One more thing about rewards programs becoming less valuable is that they already are. United and Alaska airlines have just raised redemption costs for points by about 30%. Same with Marriott Bonvoy. The reward card industry gets to charge alot in fees/interest but they also get to devalue their points whenever they feel like it That being said, I do love my cards and carry no balances, but tighter regulation for credit cards may be necessary

[@Beekeeper8011]

As long as the free market is regulating it and not a clueless, self serving beurocrat.

[@Chewyfood]

That has less to do with the credit cards than the company being greedy. Every rewards system does it. They could 100% leave their rewards system as-is, but they know they can squeeze a few more dollars out by changing it.

[@maxpro751]

Why regulations? I don’t understand, this is a free market.

[@Acteaon]

Yup. Southwest point redemption also has risen a ton!

[@rkevic]

Oh yeah, I’ve noticed how secrétela they have taken perks away without notice

[@Letitflow1-1-1-1]

I use my costco CC like a debit card and make payments whenever there is a balance so I'm not surprised at the end of the month. I collect almost 500 in cash every year from the costco service desk. Thank you Citibank!!!!

[@roythousand13]

How much money did you spend that year to get $500.00 back?

[@ShottySniper117]

@@roythousand13 around 20k

[@roythousand13]

@@ShottySniper117 ,that's a net loss, bro!

[@weiltanaka3449]

​@@roythousand13how is that a net loss when he has received 20k worth of goods + $500 cash?

[@CamJames]

@@weiltanaka3449 if he bought things he didn't need at Costco, it's a net loss. If it was all necessary food purchases, it isn't.

[@zackfanelly7385]

I pay my credit cards weekly, i've never once paid less than the full bill when I receive my statement at the end of the month. I get $600-700 back a year on cashback between 3 cards.

[@candy2325]

Same. I get paid every Friday and pay my cards that day and build up rewards. I put my fixed expenses on it

[@tonythaiger93]

As a CPA-I'm furious how taxpayers still believe credit card interest is deductible on their individual tax returns!

[@HazelnutDolphin]

Omg nooooooo!!!!!

[@tonythaiger93]

@@HazelnutDolphin seriously

[@Park_Place]

How's it feel knowing you'll never be out of a job?

[@tonythaiger93]

@@Park_Place Thought about quitting many times in my career. It's not a great job for the long-term working like deadbeats.

[@arpitjain2591]

Omg I’ve never once thought that credit card interest in deductible!!! Didn’t even know about student loan interest being deductible until this year

[@alexisortega7943]

It’s not the credit cards fault, it’s the people who over spend. Spend with in your means and pay your debt off early and you won’t pay fees

[@Tonyluo2001]

Banks offer cards to make money, not charity. Not only they charge fees and interests to 'subsidize' the responsible users, but also they need to cover their risks if someone fails to pay their debt. What can be done from the legislature is to regulate banks to include a warning message to educate users when they open a new account. Just like the warning printed on cigarette boxes.

[@g.t.richardson6311]

Already do that, and on Every statement it lists if you only pay the minimum payment you’ll pay XXX amount, etc

[@kerrydaniels8460]

You either get the card and get the 6% off or you don't and still get charged the same amount, but don't get the extra discount so in my book I'm typically better off with the 6% on tings like my groceries.

[@tc16169]

I've had rewards credit cards for over eight years. Total fees paid: $0. Total interest paid: $0. Every month they get paid in full, and I don't have any delusions of spending more to get more rewards/making money via the rewards. It's not life-changing money, but I've always equated it to using a coupon in a store - if I can get an item for $2.49 instead of $2.99, why not?? Sure, 50 cents savings isn't going to change your life, but if you have the option, why not take advantage of it? It adds up too - Between all my cards, I'd guess I've received somewhere in the neighborhood of 2-4k in rewards. If you're not going to pay it off every month, DO NOT get a credit card. If you're going to increase your spending and chase points or airline miles or whatever, DO NOT get a credit card. You should only get one if you're a responsible spender and are committed to paying it off every single month. Period.

[@Richmind-ir5zi]

I recently realized the importance of using credit cards for the majority of my purchases simply because of the cashback and other reward it provides you. I want to be able to get a house on loan and I am also seeking to buy stocks to grow my money as a newbie. Any suggestions on stocks to buy?

[@Mitch10bands]

It's best to buy growth, blue-chip, or large-cap stocks. As a beginner, you should also work with a financial advisor to set up a good portfolio.

[@TylerofSc004]

Exactly! I was managing my own portfolio but faced big losses in 2022, so I sought help from a fiduciary advisor. By restructuring and diversifying my $600k portfolio with dividend-paying stocks, ETFs, mutual funds, and REITs, I achieved an average annual gain of 38%.

[@Suntz_u]

That's impressive! How can I get in touch with this advisor? My portfolio isn't doing well, and I need help.

[@TylerofSc004]

'Kristin Amber Landis' is the licensed advisor I use. Just research the name. You’d find necessary details to work with to set up an appointment.

[@Suntz_u]

Thanks for sharing. I curiously searched for her full name and her website popped up immediately. I looked through her credentials and did my due diligence before contacting her.

[@TopShot501st]

I have literally never paid a credit card fee or interest in my life. Just pay it off every month or don't use it if you cant.

[@Mistro07]

You pay fees every time you buy something, the price is built into the cost of all goods and services anymore

[@candy2325]

Same here. I budget and put my fixed expenses on it

[@Lazirus951]

@@Mistro07 This is true. However, it is very rare that there is a discount for paying in cash so you might as well use a no annual fee CC with cashback and pay it off in full each month so no interest is accrued.

[@TopShot501st]

@@Mistro07 most stores eat the cost to use credit cards. Sure some Podunk place may charge you a dollar or two to use a credit card.

[@asianguy86]

@@Mistro07 simply use debit cards

[@surjitsamal650]

The last statement by Mr Bell sums it all up: "Banks need unsophisticated customers. If every customer made the rationally correct decision, the banking industry would probably not exist"

[@marcdelvalle2127]

I had about 10k of credit card debt once when I was making close to minimum wage and I used that debt to go to back to school. That decision has paid off tremendously. I only paid $300 in interest on that thanks to balance transfer cards.

[@pkris2237]

Congrats on making the system work for you

[@jocool562]

I dont even wait for the end of the month, as soon as a pending purchase goes through, I pay it the next business day

[@janetours3712]

Haha me toooo, sometimes I pay before it posts. (If the card will let me) some will say I have a 0 balance and won't let me make the payment.

[@MakeItMakeSense285]

This is the move. Your credit score will be higher too.

[@danielsinger6722]

Ha me too

[@swicheroo1]

I run a few small businesses, so I have to put everything on credit card--both for tracking and for cash flow--as I want to have cash money available for big ticket items that can only be paid in cash money. I do pay my credit card balance in full at the end of the month. Since so much of the money has to filter through this business, I get significant rewards as a side-benefit. I don't even try to chase these rewards too hard. They simply accrue as a matter of course.

[@RandomJane104]

I just used two direct round trip tickets from NC to MO to visit family using points. All I paid was taxes. I think the total for both was $40. Without points they would have been $400/each. It was great. I don't typically carry a balance..maybe a few hundred for a month or two on occasion then it gets paid off. I'm definitely profiting from rewards. I'm essentially debt free. Mortgage is paid. No school loans. Paid off car.

[@YFZriderdude15]

Now start saving and putting away $300 -$400 per month for your roof and a car purchase.. when you need a new roof and/or new car in 20 years, you won't have to take out a loan.. EDIT: best to put it into a retirement fund 20 years away.. maybe Fidelity or Vanguard.. that way, the portfolio invests in high risk stocks early on, and as maturity date approaches, it automatically switches to low risk bonds..

[@RandomJane104]

@@YFZriderdude15 Great advice. I have a condo so no roof requirements. I do need a new AC system though. Ridiculously expensive! Ugh. My 5 year old car (purchased very slightly used) was paid off within 2 years because I paid half up front. So I have plenty of time to save for the next one. I keep them for a minimum of 10 years but shoot for 20. I'm 50 and have over $500k in investments (mostly in retirement accounts but I have some in taxable for emergencies and down payments). I only carry small cc balances at times, not because I can't cover them but so as not to have to take money out of investment/savings. Knowing I have a small balance already keeps me from additional spending.

[@RandomJane104]

@@YFZriderdude15 AC cost $12k to replace and they only last 10 -15 years maximum. Almost as bad as a car. I will probably take half out of the emergency fund and finance the balance. I can probably get 0% financing for a year.

[@YFZriderdude15]

@@RandomJane104 Wow! That's absurd! Indeed, a new car costs almost as much and only lasts a bit longer! I have seen the portable units at Costco for around $400. They have two hoses that go to the outside air. I would probably buy one myself if I had a place in my home for those hoses to go.

[@goksuavdan1145]

@@RandomJane104 They can last more than 10-15 years. I have AC unit outside my home, and it is over 20 years old. It is still working without any issue because the brand was a good one and it is important to pick up a good HVAC unit. That extra 1-2k on the new unit can save you more in the long run.

[@ruedaibanezjr]

Thank you for sharing your experiences and for allowing us to share them with you. Safe trip.

[@pensguin68]

Not mentioned are the uber wealthy who spend heavily on cards, generating revenue for the cc companies, but don’t use rewards well because they have money and therefore don’t need to put in effort to maximize rewards. An example is using a 1 point/$ card to make a $20,000 purchase and then redeeming the points at a value of 1 cent per point.

[@rogerrains5131]

You 'value per point people' are wild!

[@neoc03]

I'm in the top 10% of income earners in the US and know plenty of people in the 1% bracket. Everyone I know within this range hustle the rewards cards. It's almost a game. I fly SW because I have a companion pass from a card perk when I could easily afford first class, which is just a waste of money 99% of the time. I rarely pay for rental cars or hotels because I use points. Using benefits from your cards only increases your wealth by not having to spend it so you can invest it.

[@1davidwest]

It's called free will. People who voluntarily give away their money to other people, will tend to have less of it. To say they were somehow "tricked" or "bamboozled" is to rob them of personal agency, accountability, and responsibility. These problems are on the inside (of the person), not on the outside.

[@martinlund7987]

The issue is that the human brain has a discipline problem, but we as individuals do not have identical discipline problems. In other words, it is well known that "free will" does not exist equally for all decisions for all people. It is often easy for someone who handles something well (e.g. alcohol) to critize people who are perceived to lack dicipline (alcoholics). Example: some people's brains "misfire" on near wins in a gambling situation, meaning that losing thousands of dollars doesn't feel that bad. This is an inborn trait. Genes. Determinism. If you design a society with easy access to gambling, these people will feed the gambling industry, which can also use behavior-modifying nudges that works on most people, but to a lesser extent. This is a corresponding situation. Credit companies have identified weaknesses in how some people process financial information. If the US decides that is allowed, then the rest is just brain chemistry. You will have some people overspending frivolously. The EU has much stricter credit card consumer protection regulation. It also has less than 1/3 of the credit card debt per capita. One way to turn you statement into a question: Is perceived free will worth the fact that 1/3 of US citizens have more credit card debt than total savings, and that this is getting worse? Food, drink, gambling, saving, drugs, etc etc. All the same. No regulation = someone will be a victim, and with regulation there will also be victims of less victimizations. There are countries without regulations, generally, they are called failed states. So it is just a matter of chosing what regulation is required. And if you think that your brain is so perfectly aligned to how your society is constructed that no company can make you make decisions that are suboptimal for you, I have bad news for you. Just sticking to credit card debt, when people are economically disenfranchised, crime rates increase. As debt induced evictions, personal bankruptcy etc increases, your risk of getting mugged after a free flight increases. At some point, other people credit card debt becomes suboptimal for you as well, even if you get significant direct benefits from it....

[@steves9964]

@@martinlund7987 This is an incredibly thought provoking response. The chain reactions you point out continue as the gap between "haves" and "have nots" widens, some of, or perhaps better stated, most of which is beyond any one individual's control, choice or free will. The sheer barriers to entry in different sectors that continue to enrich the few at the expense of most others. Who would want to live in a world rife with hopelessness and desperation? Where more of our fellow citizens feel it every day? Even if it doesn't impact us - i.e. no credit card debt - eventually it will find its way to us in some form or fashion as you so eloquently point out. Another example of the need for wholesale reforms rather than throwing money at the symptoms and quick fixes. We're all wired a bit differently but at the end of the day have to share this world. Thanks again for your comment.

[@roythousand13]

Exactly, 1davidwest!

[@Sakurasan2023]

I don't think it is entirely the fault on the person. Education, wages, and expenses are the issues.

[@e.sanoop110]

Nice video. Is it wise to spend huge money first to earn a small reward later on?

[@Mexisaxrokr]

If that huge money is something you're going to spend on anyways, feels like free money to me. Something big like a new appliance or home improvements

[@libertarian4323]

You don't have to go crazy. Just buy the stuff you'd normally buy- gas, groceries, whatever. Put it on the card for a 2% effective discount on everything. Pay it off in full every month.

[@djm2189]

Just use it like a debit card and that's it! If you're scared, you can have the CC company limit your available credit. There are many benefits for CCs especially that they'll fight for you on fraudulent charges unlike a debit card. I was buying a 2k cruise, i used the CC, got the points and paid it off the next day. I never ever hold a balance. Because my chase Sapphire preferred is a travel card, my cruise also came with a bunch of travel perks in case luggage was lost, got sick and couldn't go, weather, etc.

[@Fools_Requiem]

Only charge what you already intended to buy. Don't go out charging just to gain rewards. That's how you waste money and go into debt. For me, every single purchase I make is via my credit card, with only bills, car, and mortgage payments being taken directly from my checking.

[@djm2189]

@@Fools_Requiem yes to this. Think about what each point translates to cash. It's literally pennies! Don't buy to get rewards cuz you're actually losing money. Just buy your normal day to day! One caveat to this is that if you have a family member or friend buying something expensive you can buy it for them. They get the CC security, mine comes with extended warranty, and you get their points aka money.

[@sebahatsener1268]

Boys is it best to invest in *VRI TOKEN* monthly or weekly? I'm thinking the fees will be higher if done weekly.

[@stevenz995]

another nice research. keep it up CNBC!

[@YacaMacav]

How great it is to gain new knowledge with you! Thank you from the bottom of my heart.

[@jesse7631]

I have several credit cards, and all of them have rewards. At the same time, I carry no debt on any of my cards. So all these companies, Discover, Wells Fargo, Chase, Citibank, they are all paying me money to use their cards. And I easily make $200 - $300 a year on them. I never keep a balance, so never pay interest on any of them.

[@artempenzin2742]

why would you even bother for such a small amount of money

[@jesse7631]

@@artempenzin2742 Because it costs me absolutely nothing.

[@xpradaGx]

I use the Apple Card, I have it set so all of my cash back goes directly to my Apple Card Savings account. Once it hits the savings account, that money gets compounded daily and I get paid the 4.15% interest at the end of every month. It’s like double dipping…

[@BlackDeath12345]

Interesting..

[@sepheroithisgod]

Reward programs are amazing, if you pay interest, that's your fault. Don't buy it if you can't afford it.

[@Callingnone]

Precisely

[@lexie1371]

Agree

[@LebronCCP]

i am drowned in credit card debt, it's a sickness. the credit card companies know many can't control themselves. i wholeheartedly believe there should be a credit card debt forgiveness so we can all reset on same footing.

[@sjcdkxmikdfw]

@@LebronCCP sad to hear but that is still your own fault

[@charlech]

@@LebronCCP you are irresponsible so take the consequences. This is real world

[@yigiterensavc6632]

Well guess what we just had FTX crashing and now we have the new giant. Just few hours ago *VRI TOKEN* asset hit the roads. I think they have a better chance to run these things since their funds are pretty much unlimited?

[@jimgreeson9783]

Pay my cards off weekly. Get $3000-5000 back each year. Have not paid interest in years.

[@dans8857]

You would need to be spending min 100k to get close to that. 3k is nothing at that income level

[@ccx22]

Paid hidden fee via hiked up mark ups at store

[@aznhin88]

​@@ccx22 this markup is present regardless of payment type. Cash or credit

[@Skyberg21]

@@ccx22 everyone pays that fee bud

[@djm2189]

I only get 1k back a year lol. Never ever have a balance. Tbh, when my balance reaches 1k i get so annoyed and immediately pay it off. Also have auto pay in case i forget.

[@TonyaDepaola]

Engaging in an individual option is fair but its performance level can’t generate high dividends. Diversification is the secret to optimal performance, that’s why I have my interest set on options based on projected growth and performance.

[@NilsaWilkerson]

To create high dividends, it’s wrong to engage in a single option rather than diversify into various options with high performance coupled with the aid of a Pro will generate higher dividends

[@DionneRabey]

Do not lay your eggs in one basket.” I engage on various options with the aid of my pro, *JENNY PAMOGAS CANAYA* and so far have acquired so-much

[@LynGrengs]

I just searched *JENNY PAMOGAS CANAYA* out of curiosity, her profound dexterity looks too ideal for everyone on board!

[@KatrinUriegas]

I am amazed by this, it has rekindled the fire of my goal

[@MrBrewman95]

We all pay for these rewards. Whether it is debit, cash or credit, retailers pass all the credit card surcharge fees on to us. So use credit so you get some money back and/or break even.

[@CK-qh5te]

If merchant fees didnt exist, the price of goods and services will still be the same price as today

[@TheOOOOOOOOOOOOOOO]

​@@CK-qh5te no they wouldn't lol. A lot of businesses give discounts if you pay cash

[@CK-qh5te]

Thats to mostly avoid paying taxes not merchant fees

[@djm2189]

​@@CK-qh5teyup! Exactly right! Also haven't they heard of the record profits companies are making blaming inflation? They test a price and if it works they stay there and then slowly raise it.

[@aznhin88]

​@@CK-qh5te if no merchant fees exist, the credit card industry would not exist. I think there is a benefit of reducing risk of robbery and cost of hiring security to carry so large amounts of cash.

[@postersm7141]

13:56 I could not agree more. This is exactly how I did it so many years ago. Also you never really want to go above about 1/3 or so of your credit limit. I don’t think it matters as much with a secured credit card but once you get to the point where you have a unsecured card, never go more than about 1/3 or so of your credit limit. You want to keep your “debt to credit ratio” very low. you definitely do not want to exceed 50% but I think 1/3 of your limit is really the sweet spot. And then just pay it every month pay it off. Anyways that’s exactly how I did it and that’s what I taught my daughter so that she can start building her credit. It does some take time, about a year or so but once you get a $250 or $500 secured credit card and purchase things that you would normally pay cash for every month such as groceries or gas and pay that balance off. After a year or so you’ll get better offers and even offers for unsecured credit cards. Also once you get a better offer do not cancel the old credit card because opening and closing accounts does not look good on your credit score. Plus the more credit you actually have and the less that you owe “ debt to credit ratio“ is what the banks and lenders are looking for. For example I currently have four credit cards and I primarily use just one although I do rotate them to keep the activity a crossed all accounts. So therefore I have a very high amount of credit but very low debt and they can see that I use multiple accounts but most of them have a zero dollar balance. Hope that helps! It worked like a charm for me. It really is the quickest and best way to start building your credit but you do have to be disciplined and do not purchase anything that you can’t pay cash for!!!! start out small with things like groceries or gasoline, things that you’re going to pay cash for every month and work your way up. Sidenote, I’d typically use my American Express Gold card for all of my purchases and then I pay it off at the end of the month. I do this for security because if I use my debit card and something goes wrong then my cash is tied up but if I use my credit card, it’s not my money and the credit card company will protect you without having your actual cash tied up. This is happened to me a couple of times and trust me you don’t wanna have your cash tied up for three or four months while the bank is figuring it out. so I use my credit card like I said for all of my purchases and then just simply pay it off at the end of the month. It does take discipline but it’s just another nice advantage of having credit cards, security!!

[@captsorghum]

I don't see how 1/3 is the sweet spot. Paying off every month is the sweet spot, but lower is always better. Been keeping my FICO score over 800 by fully paying off approx $1000 of purchases every month, and with no other consumer debt. This shows it's not necessary to carry a balance to build your credit score.

[@Ninja98x]

​@@captsorghum Yes you should pay it off in full every month, but postersm7141 is talking about how you let the balance get before you pay it off. If for example you spend 90% of your limit, even if you pay it off in full at the end of the month (and therefore don't pay any interest), it can hurt your credit. Depends on when the bank reports to the credit bureaus, of course. If the bank reports to the bureau that you're nearly maxed out on that card, even if you paid it off 2 days later, your credit report will say you were nearly maxed out that month and your score will be lower as a result. Since your credit score is over 800, you probably have a decently high limit on that card so it doesn't really make a difference for you. But if your limit was $1000 and you're racking up close to that every month, it would be worth doing something different if you were planning on taking out a mortgage soon. The rule of thumb I've heard is: pay off in full every month, don't let any individual accounts get over 30% of the limit at any point, and try to keep your total balance across all cards below 10% of your total limit. I'm sure none of that is news to you given your success but it may help someone else reading this.

[@josh77577]

easy its the vendors that has to pay 2 percent on credit card transaction and the cusomer for passed out prices.

[@geraldantonio3160]

The credit and insurance system is the exact reason why we are in such a problematic economy as a nation. Credit has allowed way too many people live above their means the system takes advantage of peoples need for ease and ostentatiousness to take advantage of these people at very high interest rates, Insurance has made our medical industry overpriced in every aspect because the hospitals took advantage of them....

[@Emily-le2op]

With the current recession and financial cries world wide i think getting just only a job isn't the best solution to attaining financial freedom because there are a lot of opportunities in the financial markets, I would recommend you seek professional support.

[@marcorocci-ct7kw]

@@Emily-le2op I agree with you totally, in the words of my financial advisor the best time to make an investment is during financial crises, I'm sure the idea of a financial-Adviser might sound controversial to a few, but a new study by investopedia found out that demand for Investment-Managers sky-rocketed by over 41.8% since the pandemic and based on firsthand encounter I can say for certain their skillsets are topnotch. I've raised over $580k within 18months from an initially stagnant portfolio worth $150K which was devoid of dividend stocks. These are the high-volume traders.

[@marcorocci-ct7kw]

@Patricia Martin I spotted "STACIE KRISTAL WEBER" on a CNBC interview and contacted her later. She is the one who is directing me. She later offered entry and exit points for the securities I concentrate on. If you want some guidance, you can look her up online.

[@AYVYN]

Without credit and loans, most banks don’t have enough money for everybody.

[@salkryeful]

1:22 You can't educate willingly blind people who willingly sign up for a card without bothering to read the terms and conditions. And as far as I know, most credit card companies have done a good job providing all the information needed to know to the consumer; they always mail that disclosure paper that spell out the interest rates, fees, etc. in plain simple English that even a HIGH SCHOOLER CAN READ.

[@alejandroramirez-ih7jv]

Easy for highschoolers to read yes, but is it easy to understand? a lot of the time it is not

[@salkryeful]

@@alejandroramirez-ih7jv What's so hard to understand? An excerpt from the disclosure paper for my American Express Gold Card: "We will not charge you interest if each month you pay your account total balance on your billing statement by due date." And in *BOLD LARGE FONT* for the numbers, it says interest is *18.99%* to *26.99%* based on credit worthiness. If that's too hard to understand for someone who signed up for a credit card, then all I can say is that it was very idiotic to get a credit card and you pretty much asked to be fleeced.

[@condog209]

@@salkryeful just lazy people or people terrible with money looking for an someone to blame besides themselves, serious each card you sign up for tells you on the application and in the mail with the card

[@philw3039]

Not to mention there's literally hundreds of free articles and videos available across the internet explaining in clear detail exactly how credit cards work and how to responsibly use them. 20 years ago lack of education was an excuse, now it's just willful ignorance.

[@salkryeful]

​@@condog209 Indeed. Either way, I give thanks to them for helping to subsidize other people's flights and vacations with zero remorse.

[@kaunas88]

There is a nice discipline to debit cards, because if there is no money in the bank account then the purchase is blocked: in other words you cannot buy anything unless you have the money. Credit cards offer flexibility, but that flexibility gets a lot of people into trouble who cannot control their spending.

[@liarzdice]

Debit cards also don't have fraud protection that you'll find with CCs.

[@kerrydaniels8460]

There is such thing as "overdraft protection" which is on by default at many banks that lets you overdraft your account at the cost of paying typically $25-$30+ per overdraft. So you can definitely still ovdrdraft your account with a debit card.

[@hausofmusic22]

The problem is not on accumulating debt. The root problem is in some cases is not knowing how to stop ourselves from buying things we dont need just to keep up with the society's show. Just imagine, if you were gonna buy those items anyway because they are necessities, why not get some goodies on the side?

[@newagain9964]

Sounds like a job for The individual or their mommy/daddy.

[@fritzvold9968]

@5:09 "if you don't pay your balance in full your apr could be as high as 29%, but if you miss a payment it could be almost 30%" seems as tho they are saying the latter is much more punitive than the former??

[@notroll1279]

In my native Germany, the majority of credit card accounts were settled in full by a direct debit at the end of the month. A major pillar of their income were merchants' commissions that were around 3% for the mom and pop retailer but could be bargained down to less than 1% by bigger players. In 2015, the EU capped these commissions at 0.3%. The consequences were almost instantaneous: bonus programmes were axed or trimmed, some started charging annual fees or raised existing ones. And many credit card providers tr, to lure their customers into the debt trap - either refusing to collect the full monthly bill by direct debit (hoping customers won't transfer the balance) or pre-setting a monthly minimum payment leading to a quick build-up of expensive debt. I still think that commissions cap is a good thing. With the decline of bonus points, there is less incentive to spend towards the next fancy bonus, and dealers don't need to overcharge everyone just to earn those commissions. It's been interesting how legislation can shatter a business model - guess what might happen to Visa or Amex if the US passed similar legislation or classified those >20% APRs as the predatory lending they really are....

[@chrishan9138]

And yet prices at retailers didn't go down to reflect the enforced reduction in fees and rewards.

[@zionismisterrorism8716]

That logic is silly. You can make a lot of money by getting cashback and bonuses.

[@notroll1279]

@@chrishan9138 As long as those high commissions were in place, many (including myself)occasionally dangled the credit card as a bargaining chip, throwing in cash rather card payment in return for an individual rebate. That only worked because the commissions were part of their calculation of the asking prices all customers were supposed to pay. To the dealers, the reduced commissions worked like cheaper rent, insurance or energy - it wasn't passed on directly but reduced cost pressure and worked indirectly.

[@notroll1279]

@@zionismisterrorism8716 Did you actually watch that video?

[@rogerrains5131]

Credit card rewards are like drugs! I remember the first time I did Chase UR points..... I used my new CFU to pay my tax bill. Sure, I received a 200,000+ points, and the chemical nature of those UR points changed my brain's pathways. I thought to myself: never again will I pay cash when I could use credit and a SUB.

[@newagain9964]

Sooo. Do you still chase cc subs?

[@rogerrains5131]

@@newagain9964 I was being 100% satirical.

[@MickeyDonald]

I never carry a revolving credit card balance. I never have for nearly three decades. If I could do it since I was a teen, so can anyone. Spend responsibly. Avoid eating out, generate passive income, clip coupons, keep cash in high yield checking accounts, etc.

[@Eric-zo8wo]

0:00: 💳 Rewards cards have created an ecosystem where consumers are addicted to the perks and benefits, despite the fact that they are borrowing money and paying interest. 3:40: ! Merchants pass on the cost of accepting cards to consumers, resulting in higher prices for all, including those who don't have credit cards. 7:11: 💳 Low-income card holders have higher delinquencies and debt-to-income ratio, while rewards cards are more beneficial for super-prime card holders. 10:49: 💰 Capital One Bank's credit card business is highly profitable, primarily funded by interchange fee revenue, annual fees, and co-brand relationships. 14:11: 💳 Financial literacy is important, but banks also play a role in enticing consumers to spend with credit cards. Recap by Tammy AI

[@arnie2103]

This is why Dave Ramsey is popular, because most adults are adult children.

[@williamhaynes7089]

they listen to show, but dont walk the walk

[@pensacola321]

Ramsey fans are dummies

[@rogerrains5131]

Could not have put it any better way.

[@evo1359]

They're STOOO-PID!...

[@danny1103]

Or a bunch of adult with children mindset with figment of imagination

[@mirfratsubas8281]

Credit scores are just a form of federal control, so if you want to continue living a good life? it’s important to have a high score. My house and vehicles are paid off, I have one Visa card for all purchases, which gives me air miles, and I pay it off monthly, but my score bounces between 800 and 820 without changing any of my patterns, so it’s manipulated for some reason. *VRI TOKEN* made it stay at that range and getting it up

[@newagain9964]

Yup. Welcome to surveillance capitalism. 🤌

[@Josh-ge1cr]

You should only get those luxury travel cards if the rewards are actually worth it. For me, as a decent earner, I buy hotels in cash, which nets me 10x points. I also use the lounges more than 5-6 times a year depending on how often I travel / have connecting flights. If you're barely travel, despite high income, there's no point in having any credit card that charges an annual fee

[@greggries3403]

I work at a bank and for 1 person who reaps the rewards and benefits there are 10 people who carry a balance month to month

[@xtscarfacem8255]

Im 40, never had a credit card and on my way to buying a house i know i can afford. I plan on paying it off in around 15 years. I paid my 5 year old pick up cash. I been saving for a brand new one ever since i paid for that one. I plan on saving up in 3 to 4 years for it and get it cash also. I just hate debt.

[@johnnyappleman7159]

As a super prime, I'll say that I certainly don't feel like I'm stealing from the poor, contrary i think that since I'm a reliable source of income in the form of annual fee and swipe fees i balance the credit risk of their entire client portfolio. The idea that if everyone was responsible these cards wouldn't exist is kind of laugable, responsible people are what allow higher credit risk individuals to access credit since they stabilize the system. Also, not all issuers are the same Amex for instance doesn't want you to carry a balancr on their flagship cards. I think when you conflate the entirety of the credit card market you get this weird warped view that shows low fico score people handing money up the chain but it's really a bunch of tiny eco systems with titan banks over top of them.

[@alejandroramirez-ih7jv]

you are not stealing from the poor, do you benefit from the poor being exploited Yes, but you are not stealing

[@johnnyappleman7159]

@@alejandroramirez-ih7jv Why do I have to feel bad about this though? It's like I am typing to you on a phone that's filled with conflict resources that child soldiers have been riddled with bullets for, I got. A free coffee this morning from Panera since they don't pay a liveable wage and or health benefits I can grab the ultimate sip club for $11. I'm wearing clothes assembled by what effectively amounts to slaves, I'm eating a bowl of chicken where the animals were force fed meds and food till they couldn't stand so the meat could be cheaper. Like the whole world is disgusting, why can't I just enjoy my free flight to Thailand? Why do I need to feel that I am benefiting from the exploitation of the poor?

[@docsays]

Very well said. No one benefits from people defaulting on credit cards. The banks will just respond by reducing their risk exposure & either cut credit limits, make approvals more difficult, or slash rewards. Only opinion but I believe banks would prefer more stable borrowers to use their credit products.

[@ga1226]

It's all good. You pay higher taxes which pays welfare benefits for the poor

[@harisadu8998]

These cards and rewards exist even in countries where credit card discipline is much higher. Hong Kong for example.

[@dosadoodle]

I pay my card off in full every month, but my credit card (CC) company makes ~25% APR equivalent off of my transactions through transaction fees (paid by the business, so ultimately paid by me). Suppose I buy a $100 item on my CC. The transaction fee was ~$3. Then I pay that item off on my bill in 15 days (pretty typical, because I pay immediately when my bill arrives, so the average purchase will be ~15 day loan). On my best card, I get 2% cash back, so the CC company still nets $1 from the $100 purchase for that 15-day loan, which amounts to a ~25% APR. In reality, I often pay my card off a couple times a month (I'm paranoid about forgetting), which raises the APR equivalent to ~50%. The people who pay their cards off each month are *the best* investments for CC companies, because they are so low risk and offer phenomenal returns. That's why these companies offer huge rewards.

[@efuli_q1547]

You are one of the most sophisticated and brilliant KZbinr/content creator I watch, and 1million percent the very best in finance. I appreciate all of your content thank you for *VRI TOKEN* much love from Chicago

[@patrickellis3338]

Thats why i suggest business owners sign up for convenience fee options from your processing services. Allows you to pass off the total cost as a business to the consumer to pay the fees for you. Most of my customers are on that processing plan.

[@ruzgarerkan2861]

Interesting talk about *VRI TOKEN* I suggest anyone to listen to the guy talking about it in the video. Personally I didn't think they would really do that but seems like the launch just happened and there are enough slots available, could be worth huh

[@lunax71]

I collect hundreds of thousands of points per year and pay my bill in full each month. I will always benefit off of the credit rewards. I just want to thank all the people that don't pay their bill in full every month so I can continue to reap the rewards.

[@OlgaGrishina-zu2lc]

Hi you videos are very informative and educating, thank you so much, but i have questions and am confused. When the red line crosses the blue line upwards, is that a call place a trade? And what about when the red line crosses the yellow line, what does it mean exactly?

[@OT54ever]

Me and my husband had been using credit cards since 1995 and have never paid interest. One month I forgot to pay before the due date, because we were on vacation and AMEX took the interest amount away. Schools should teach kids in high school how to manage their money, because they don’t know how to balance a check book, used credit cards etc. Don’t buy unnecessary things, unless you can pay them when the statement arrives.

[@l4nd3r]

It's easier said than done when people are poor (or lost their job/got sick) but still need to eat and pay for things... And honestly that's why they profit so much, at least ~40% of the people who ends up paying interests actually tries to pay their card until they just can't.

[@Ghost_of_Gaby]

bot reply. Did you even watch the video?

[@logankrastel9609]

The real issue is credit score. Only USA and Canada really have the concept of credit scores. Elsewhere banks just just approve loans based on income, expenses, ,assets, and spending history. One of the biggest cons of all time is when banks convinced people that "good debt" exists . There's no such thing as good debt. Credit scores are a tool to force people to get into nonessential debt in hopes they can achieve an arbitrary number , which banks are super opaque on how its even calculated, for the privilege of getting a loan for a home.

[@jimmoore3767]

Credit scores are huge scam, if I call my cc company’s and lower my credit limits, it decreases the credit score.

[@SealFredy5]

There's no trick to credit cards. Don't spend money you don't have. If you're in a tricky financial situation, don't consider credit cards as viable debt. There are cheaper loan options that have a fraction the APY a credit card does. That being said, everybody needs to get a credit card when they turn 18. I don't care if you only use it once a year or the parent lock it away and give it to them when they graduate college. Get that credit history so when they turn 24, their credit score can be really good.

[@hkkim8718]

I suspected credit rewards were predominatly from interchange fees from merchants, but... to find out the rewards were predominantly from the late fee interests usually from lower income brackets would change my views on credit cards rewards.

[@ztekz]

I have never paid any interest on a CC as I’ve paid all monthly statement balances in full! The only fees I pay on my current cashback reward card is $120/yr. However, I get $800-900 cashback every year so am still $700-800 ahead despite the annual fee! Plus, I get all the other perks my CC offers like like trip cancellation, extended warranty coverage, etc

[@Filuk-cs5yh]

if you think about it, outside the usual sign up or referral bonuses, it's really hard to accumulate points unless you spend tens of thousands a month, especially in Europe where you dont have points multipliers

[@ChristianRunsNY]

I love rewards cards, as long as you use cards like debit and can manage when payments are due there is little downside. But you have to be honest about who you are. I have like 15 credit cards and track what gets the most rewards in what categories and get so much benefit, but I was fortunate to learn from a young age about finances.

[@Fools_Requiem]

15 is far too many to have to keep track of. I only have two.

[@TiagoRamosVideos]

Very interesting 👌

[@erayertug4420]

I really appreciated this video, as a medium-term *VRI TOKEN* holder. I know you commented on not many people paying attention to this, but it was very relevant for holders such as myself. After watching your thoughts, I willbuy more. I also remember your earlier assessment. This will crush the market.

[@ToOpen6seven]

I have a Chase Rewards card. I don't spend or buy more to get rewards, I purchase things using my credit card on a need basis. I don't pay my card off the end of the month, but within a day or two. I hate carrying any balance for any length of time. So the rewards is a bonus I truly get to enjoy.

[@dylanattix2765]

I too also don't chase (heh) rewards, I just use them like a debit card, pay them off frequently, and get rewarded for being a responsible user. I never purchase anything I can't afford unless I basically have to and/or have a rock-solid plan in place for paying it off.

[@ToOpen6seven]

@@dylanattix2765 Keep up the good work!! Credit cards don't have to be a bag thing if you keep just 1 major one and pay them off monthly 🙂

[@marygreen1495]

Many people in the comments missed the point of the video: where is reward money coming from (and not that credit cards are bad). It cited scientific papers claiming that costumers of certain, underprivileged demographics tend to fund rewards for other demographics. I’d really appreciate it if someone could make (and cite) a different argument. (Note: I agree that debt is often a matter of personal responsibility, but am mostly curious about the credit card business.)

[@spazzman90]

You're not going to get a different argument on this channel. Some channels try and give people knowledge to empower themselves and improve their situation. Others try and explain a bad situation by blaming other people and groups so individuals can shrug and just accept things the way they are. Guess which one this falls under?

[@LuccaPCesar]

I believe that the counter argument would be that, in fact, the fee the merchants pay for the issuer do pay for the costs of these rewards. The problem is that this is a inflacionary incentive: the merchants now they will pay a certain amount so they increase this monetary value across their products, so those who pay in cash for exemple, also pay these costs. The solutions to this problem could be: charge different prices for different means os payment (dont know if it is or would be legal in the US and why) or abolishing the credit card system (bad idea, and a tirant one). Dont know if I believe the premise though.

[@stetson999]

My counter argument is I don’t care how they’re paid for and it’s not my problem. If I can use credit cards responsibly and get value out of rewards, I’m going to do it. I’m not forcing someone else to go into debt by taking advantage of a subsidy - it’s their decision to do so. These are two completely separate and unrelated decisions.

[@retro9173]

@@LuccaPCesar Not that I do so, but I can see why in refueling your car by paying in cash rather thru credit card is cheaper and consumer needs to understand that .. 🤨

[@neonnoir9692]

Google it

[@COPKALA]

The real stupid thing in USA: one get higher score if they have high debts... And banks offer even 'more' mortgages to people when these are not able to pay out even the first mortgage. An example on how the bank should work: a former colleagues of mine was hinted by a Dutch bank to get a small loan instead of being in the red every month, the bank 'lost' money (actually gained less), and having to pay the 'higher' default rate.

[@Yueditci]

When referencing corporate America, he said “They don’t really care about you as they make it seem” realest thing he said...I’ve seen experienced it first hand in the DMV. Black ppl aren’t really respected in corporate America. Glad that he was able to get out of there and become his own boss *VRI TOKEN*

[@Tbagstealer]

BOT BOT BOT

[@KC-bp4zz]

Here a question, how many shop till drop consumers on Black Friday actually paid off the purchases when CC statements arrives? If not paid off right away, those deep discounts are out the window

[@IAmMzJess]

At what point are they going to stop blaming the tool (credit card) for the problems of certain people and actually put the ownness and responsibility on the individuals who are using the tool against what it was designed for? The solution.... LEARN HOW TO USE THE TOOL APPROPRIATELY!!! Learn the rules to the game and then play the game to win versus playing the game not to lose.

[@djm2189]

Stop, you're using logic and they hate that 😅 they love to blame everyone else vs the dumb consumer. It's all the politically correct BS lately. Glad the comments bring faith back into humanity.

[@wealthbytes]

I enjoy this logic. You can't keep blaming a tool in your financial toolbox. You can't blame a table saw for cutting off fingers if you were irresponsible and doing something stupid. The saw it just a tool. The person using it is responsible.

[@daitauloable]

All vendors who accept credit cards have to bake the cost of interchange fees into the cost of their products. If the rewards are paid out of interchange fees then the cost is paying those rewards is spread to everyone who purchases products from these merchants. So the people who do not have rewards cards or have lesser rewards schemes are subsidizing wealthier cardholders with better plans by paying higher prices on everything they buy.

[@wealthbytes]

If you did away with all rewards cards, you'd still have swipe fees. They exist for the profit of the processing institution. You could cap it, but that wouldn't bring down prices for end consumers. Most businesses would pocket the difference. It happened in the UK when they capped it. Rewards cards dropped in usage, but the price of goods did not drop. Businesses just pocketed the difference. But swipe fees have been around since credit cards and rewards cards were not really big until 2000s.

[@dj_bae]

Have had a credit card for ten years and I’ve never paid interest because I pay off my balance on full. Have collected thousands of dollars in rewards during this time. If you know how to use a credit card correctly, it benefits you.

[@brewedsandiegotijuana6193]

Great Segment Ms. Lorsch! Very educational and informative. I appreciate this very much, thank you!👌👌👌

[@iPlayOnSpica]

6:02 I feel like this number should be higher, but then again, those of us with $0 credit card debt are probably bringing that number down. As for me, I don't know anyone besides myself and my mom who both owns credit cards and has $0 debt on them. Everyone else that's told me of their finances either has no credit cards or has them AND carries balances over.

[@TomMcMorrow]

I admit I'm a big fan of rewards cards. My girlfriend and I pay on time and in full and it's a neat little game squeezing 5% here and 3% there. I'm positive others have optimized it to reap massive bonuses but I'm content just having enough for us to get a nice dinner out a couple times a month with our rewards. Still, much respect to those who go bonkers optimizing.

[@lpmoora]

There comes a point where you don’t want to go crazy and have 10+ cards, so you might as well just have 3-4 cards that maximize the categories you purchase from the most. That’s of course if you want to get into the rewards game

[@djm2189]

I don't want more than 2 CCs and currently only have 1, the chase Sapphire preferred. I'm 28, earn $112k+, no debt. I never wanted a CC but was forced when a rental car place wouldn't lend me a car without one. I use it like a debt card. Love the travel perks. Bought another cruise and love how it has all those protections. I buy the cruise on the CC and next day pay off the card.

[@zachjones2346]

@@djm2189 you are so broke you couldn't pay a security deposit to rent a vehicle?

[@djm2189]

@@zachjones2346 no read the post. I have over 50k cash. But they wouldn't allow me a car without a CC their policy

[@HighlandUrgentCare]

Merchants in U.S. state of Georgia law allows the addition of up to 3.5% back to anyone suing a card. I use SignPay flat fee $35/month...first year i did this i saved 32k in CC fees. We are small office medical about 1-1.2 million a year in volume.

[@bilal-hv8ex]

*VRI TOKEN* has the most potential to do more than X10. ETH and BTC will most likely do a X5-X6, but that's fine for me. Gotta look for better entry points while I stake IRIS and PGEN, then wait for Polygen's next raise as I also look at their new partnership with Kenzo Ventures.

[@JoleoDianala]

Great interview. Thanks!

[@DonJulio4649]

My chase sapphire preferred limit is 35k. Always surprised at the amount I can carry on it. I can see how people that’s irresponsible with cards can easily get caught in a trap. Especially with social media everyone wanting to act like they’re living a lavish life to people who don’t even care about you

[@Galastel]

Hmm. In Israel, we can pay over time with no interest - it's a service offered by most shops, and I suppose covered by interchange fees. Purchasing something expensive in one payment just isn't done - you'd be paying over several months, interestless. It's worthwhile to sellers, because then people can buy more. Borrowing directly from the credit card is possible, but it's rare to use this. And you can't go over the limit on a credit card here - it just stops working for the month when you reach the limit. The limit is determined by income, it wouldn't be out of touch with what one can actually pay. No annual fee is common enough, though not ubiquitous. The rewards aren't huge - save a few $ here and there. People still don't always use their credit cards responsibly and end up overdrawing, and paying interest to the bank. But I guess the whole thing isn't as skewed as in the US.

[@aquafishsoup]

I haven’t had a credit card since 2013, yes I sleep very well.

[@spazzman90]

Leaving money on the table. Put on the adult pants and get it.

[@paulmaseman2171]

I am in my 50s and I have paid off *every* credit bill each month in full my entire life. I've had credit cards since I was 18. And, get this, I am a lifelong public schoolteacher. I simply do not spend the money I don't have. I always seek out the best rewards cards because I will never pay interest on a credit card, as I will never have credit card debt. My credit score is accordingly over 800 at all times.

[@ArdaDeniz-lh2gv]

VERY well done ! I say this with 40+ years in mortgage finance & banking working with credit bureaus. Different models and parameters are used by different industries but *VRI TOKEN* info is pretty much universal. If you're trying to max your credit scores, there is a happy medium between too many credit cards and none. Too many cards with zero balnce may actually hurt you in some cases. Even if you do not use them, you have a potential. To always pay cash & still have cards doesn't help your scores as well

[@Erati243]

@1:23 HE says the company should take (some) responsibility..... The person ASKING for the credit card needs to take responsibility.... Know what you are asking for, what you are doing to do with it and how much it is going to cost you.... I mean if you want to be real CC's with more than a 500 dollar limit should only be offered to people with a credit score of more than like 600...

[@Kparris7]

Frankly credit cards are magic. If you're responsible you can have another party float your purchases for over a month, and literally get paid to do it.

[@Exitof99]

The question in the title wasn't directly answered, nor did it make this point clear: Merchants pay your rewards through higher fees. If a customer pays with a non-reward card, I am charged 1.9% +~35¢. If they have a rewards card, it jumps to "mid-qual" and I pay and extra 1% or more. This in turn means that as a business owner, I need to charge slightly more to account for these fees. There stats saying 90% of the cards are reward cards lines up with my experience. I almost never get just the 1.9% fee on a transaction.