patrick.net

I'm pretty sure that none of the CCs charge merchants 5%. It's more like 1.5%.

So how could a CC give you 5% back and not go out of business?

Patrick says

I'm pretty sure that none of the CCs charge merchants 5%. It's more like 1.5%.

So how could a CC give you 5% back and not go out of business?

No idea, but somehow they do. You sound surprised and incredulous. You don't have any cashback CCs?

Patrick says

I'm pretty sure that none of the CCs charge merchants 5%. It's more like 1.5%.

So how could a CC give you 5% back and not go out of business?

https://www.discover.com/credit-cards/cash-back/cashback-calendar.html

Patrick says

So how could a CC give you 5% back and not go out of business?

Charge 20% interest.

Onvacation says

Patrick says

So how could a CC give you 5% back and not go out of business?

Charge 20% interest.

Bingo!

Onvacation says

Patrick says

So how could a CC give you 5% back and not go out of business?

Charge 20% interest.

Double bingo. Most don't pay it off. CC companies, mainly Chase and Southwest hate the flying fuck out of me (pun intended). I pay mine off monthly and 90% of it is the wife's expenses that get reimbursed. Talking $100-150k spend a year.

That's why they offer cash back or incentives. They assume you'll not be able to pay in the chase for rewards/points. They dangle the carrot to have you put everything on the card. The average American cannot make the monthly nut when they "feel" like they can spend more.

If you're disciplined, you'd be stupid not to be using a CC as I've said before. It's tax free income for spending what you already would. DON'T do it if you cannot pay it off. I'll take $8k/yr tax free money which is what we're currently at, sometimes more. You gotta find the right rewards program. Southwest/Chase is the best for us as a family of 5 that likes travel. No planned trips currently, but we have probably 20 round trips in points. So four trips. It will be 40-50 by the end of the year. Not a brag, but I honestly don't know what the fuck we're going to do with it all. It would be 8-10 vacations in the next year.

The average merchant fee is solidly over 2%, and the 5% are capped at a low maximum with changing categories. There's even a cap on total cashback after which you get 0. CC companies usually come out ahead of this (they also get a lot of data out of this to crunch and sell), so do savvy customers who avoid paying interest, for the merchants it's more like a necessary evil as interchange fees aren't capped in the US and among the highest.

mell says

The average merchant fee is solidly over 2%, and the 5% are capped at a low maximum with changing categories. There's even a cap on total cashback after which you get 0. CC companies usually come out ahead of this (they also get a lot of data out of this to crunch and sell), so do savvy customers who avoid paying interest, for the merchants it's more like a necessary evil as interchange fees aren't capped in the US and among the highest.

Every card/company is different. Like I said, I make Southwest/Chase eat shit with my points for a family of 5. Even "if" I paid interest it would still be cheaper than full fare. I'm unique with the amount we spend though.

mell says

The average merchant fee is solidly over 2%, and the 5% are capped at a low maximum with changing categories. There's even a cap on total cashback after which you get 0.

I have enough cashback CCs to never bump
into caps.

“‘My other piece of advice, Copperfield,’ said Mr. Micawber, ‘you know. Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.”
David Copperfield (1850)

richwicks says

NuttBoxer says

What bothers me is I hear scanning those codes exposes a bunch of your data. I always ask for a menu, no place has refused me yet, even in San Diego.

I don't see how scanning can expose your data. You are just basically scanning the QR code to get a website that contains the menu.

This can be tied to your phone of course, that you were there and perhaps even what you ordered

You shouldn't store important information on your phone. There is no security on it.

https://www.forbes.com/sites/forbestechcouncil/2020/06/01/i-dont-scan-qr-codes-and-neither-should-you/?sh=6202865e51d1
It all depends on how the app ecosystem gets integrated on the given device and its version. We all know how the product manages make decisions in tech. part of the product development, privacy is a joke!

Onvacation says

“‘My other piece of advice, Copperfield,’ said Mr. Micawber, ‘you know. Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds nought and six, result misery.”
David Copperfield (1850)

Annual income twenty pounds, annual expenditure nineteen six, additional 30-40 pence of income from CC cashback - even more happiness.

Patrick says

casandra says

I don't want to give them my bank card as I if get that info stolen and used its not as easy to get the cash lost charged back as it is on a credit card loss.

casandra

You're right not to give the a debit card. I worked with a guy whose debit card number was stolen and his checking account cleaned out. Took him MONTHS to get the money back and he was in a really bad position for a while, literally no money to pay his mortgage.

Most people don't know their rights when it comes to this. PLEASE READ REGULATION E IN THE CODE OF FEDERAL REGULATIONS (CFR). If you notice a problem, within 60 days of posting to your statement, you file a dispute for the charge and request an investigation. This needs to be sent to the bank CMRR per the federal code. The bank then has 30 days to complete its investigation in which it has the burden of proof to show that the charge was legitimate. If not, they have to credit you back your money. Follow the letter of the law and regulation, and the bank doesn't have a leg to stand on. RTFM.

https://www.consumerfinance.gov/rules-policy/regulations/1005/

EDIT: They changed it somewhat in the last 25 years:

(1) Ten-day period. A financial institution shall investigate promptly and, except as otherwise provided in this paragraph (c), shall determine whether an error occurred within 10 business days of receiving a notice of error. The institution shall report the results to the consumer within three business days after completing its investigation. The institution shall correct the error within one business day after determining that an error occurred.

(2) Forty-five day period. If the financial institution is unable to complete its investigation within 10 business days, the institution may take up to 45 days from receipt of a notice of error to investigate and determine whether an error occurred, provided the institution does the following:

(i) Provisionally credits the consumer's account in the amount of the alleged error (including interest where applicable) within 10 business days of receiving the error notice. If the financial institution has a reasonable basis for believing that an unauthorized electronic fund transfer has occurred and the institution has satisfied the requirements of § 1005.6(a), the institution may withhold a maximum of $50 from the amount credited. An institution need not provisionally credit the consumer's account if:

(A) The institution requires but does not receive written confirmation within 10 business days of an oral notice of error; or

(B) The alleged error involves an account that is subject to Regulation T of the Board of Governors of the Federal Reserve System (Securities Credit by Brokers and Dealers, 12 CFR part 220).

(ii) Informs the consumer, within two business days after the provisional crediting, of the amount and date of the provisional crediting and gives the consumer full use of the funds during the investigation;

(iii) Corrects the error, if any, within one business day after determining that an error occurred; and

(iv) Reports the results to the consumer within three business days after completing its investigation (including, if applicable, notice that a provisional credit has been made final).

(3) Extension of time periods. The time periods in paragraphs (c)(1) and (c)(2) of this section are extended as follows:

(i) The applicable time is 20 business days in place of 10 business days under paragraphs (c)(1) and (2) of this section if the notice of error involves an electronic fund transfer to or from the account within 30 days after the first deposit to the account was made.

(ii) The applicable time is 90 days in place of 45 days under paragraph (c)(2) of this section, for completing an investigation, if a notice of error involves an electronic fund transfer that:

(A) Was not initiated within a state;

(B) Resulted from a point-of-sale debit card transaction; or

(C) Occurred within 30 days after the first deposit to the account was made.

casandra says

"Also, just noticed my pest control service, supposed to come once every three months has been hitting me up every month. Thats 178 bucks a shot on my credit card."

@casandra,

A couple of thoughts...

1. I do not allow automatic charges om my credit card. Instead, I arrange payments from my checking account which I control. These might be automatic - based on some period, monthly, quarterly etc - or just manual.

2. I do not use debit cards because of the potential very high liability.

I do allow fixed but never variable monthly charges on my credit card, like my server costs. I figure that if the charge is wrong, I can simply not pay, while if I have an automatic deduction from checking, I would have to fight to get that money back.

For my phone, I pay it manually online with my credit card every month, because phone companies are prone to surprising you with big charges.

And like you I never use a debit card.

Patrick says

I never use a debit card.

Around here, you must use a debit card to get cash from an ATM. Other than that, I would not have a debit card. Is that different where you live, or do you not use ATMs?

My credit union told me that I had to get a debit card to use their ATM, but when I pressed them, they admitted they could send me an ATM card which is not a debit card.

I think the issue is really only that they make money from the debit card but not the ATM card, that's all.

@HeadSet

Patrick says

My credit union told me that I had to get a debit card to use their ATM, but when I pressed them, they admitted they could send me an ATM card which is not a debit card.

I think the issue is really only that they make money from the debit card but not the ATM card, that's all.

HeadSet

They'll make their money either way. Electric isn't free unless you're a Tesla driver about to get fuck smacked with fees coming soon. ATM's use electric. Fine it's your cash, but it's not free to store it.

I don't see how a bank can make money from giving you an ATM card.

Banks use your money as collateral in the fractional reserve banking Ponzi scheme. Issuing an ATM card doesn’t make money, but encouraging you to deposit money and keep it at their bank is what they want. Your money in their bank does make them money.

True. They definitely needed to give me a plain non-debit ATM card or I would have found a different credit union.

At least with a credit union your membership provides you a stake in how the company is managed.

Patrick says

I don't see how a bank can make money from giving you an ATM card.

Atm fees and account management fees. Likely they can also sweep a certain percentage of your checking account overnight

mell says

Atm fees

Honestly banks make a shit load on gamblers at casinos. You show up with $1k, lose it and pull out more for $6-8 a pop. Those fees are extreme. Then cash only businesses that then have an ATM in the building that needs a card to get cash out. I see that a lot. Anytime at a big gas station there's always someone at an ATM.

Most younger people are uneducated and don't know you can get cash back at the register for free. And those 60 and older. I still see geezers writing checks slowing up the line. Problem is no one educates about day to day finance. Instead it's a basic economics class macro, micro, supply, demand, etc. Kids should be taught about interest rates, fees, 401k's, stocks, etc. My dad actually got me a stock simulator in the early 90's. I'd play that for hours. Hated my dad, but he did teach me a lot in his ass hole way teaching me things. Constant yelling at me.

Wookie tangent coming: There's stupid little things kids don't know now and I blame lazy parenting now that I see it in my kids friends. It's like parents my age just taught their kids to be respectful of other adults but the kid is a fucking idiot when you watch them from afar or the things they do. Things like pulling out a full blown serving spoon from some mac and cheese and my kids are like where did it go. The kid thought it was his spoon to eat with even though we had some out. The future is scary is all I'll say. No one has basic skills a man needs. I fear for kids being raised in urban areas.

mell says

they also get a lot of data out of this to crunch and sell

This is the entire point. Credit cards are owned by banks. Banks are controlled by the Fed. CBDC's, you get the picture...

mell says

Atm fees and account management fees. Likely they can also sweep a certain percentage of your checking account overnight

CBDC's again. Is a chip more secure than a swipe? Fuck no. What about a tap, even worse! They want you to get used to tapping chips, which will be inserted in your hands.

I had my card skimmed by some JS inserted into a site years ago. Credit union, one or two charges came out for Home Depot. I reported it and was credited back immediately while investigation was conducted. I've had to file other disputes as well, this has always been the standard, but I only use credit unions.

Other advantage, I don't keep much money in banks, don't really trust them...

I use only credit unions now as well.

Plusses:

- they don't close accounts for political reasons like JP Morgan Chase does over and over
- higher rates than banks!

Minuses:

- not as professional
- limited number of physical branches

Patrick says

I use only credit unions now as well.

Plusses:

- they don't close accounts for political reasons like JP Morgan Chase does over and over
- higher rates than banks!

Minuses:

- not as professional
- limited number of physical branches

I disagree on "less professional" part: when I needed to wire transfer a non-trivial sum to an unusual destination I first tried to go through a big bank because they promised 100% online experience and they failed miserably - I had to visit them 3 times, my money were frozen in the account for 3 or 4 days and ultimately they said it couldn't be done. Went to my long time CU and all was done under a 1/2 hour.

Who's less professional here?

PS. Stupid me for not wanting to go in person in the first place.

RWSGFY says

Patrick says

I use only credit unions now as well.

Plusses:

- they don't close accounts for political reasons like JP Morgan Chase does over and over
- higher rates than banks!

Minuses:

- not as professional
- limited number of physical branches

I disagree on "less professional" part: when I needed to wire transfer a non-trivial sum to an unusual destination I first tried to go through a big bank because they promised 100% online experience and they failed miserably - I had to visit them 3 times, my money were frozen in the account for 3 or 4 days and ultimately they said it couldn't be done. Went to my long time CU and all was done under a 1/2 hour.

Who's less professional here?

PS. Stupid me for not wanting to go in person in the first place.

Credit unions will process ACH transactions between individuals. My commercial bank won't do that.

The_Deplorable says

I'll always argue this. Cash costs you 2-5% pre-taxed dollars. It's more expensive to use cash as the CC fees are built into all transactions cash or otherwise. You're literally losing money, you all know this right? If you care about privacy your best bet is to just die. Not a threat, just reality. Cash is also trackable anyway. They put the serial numbers on there for fun.

You guys are all getting taxed 2-5% and sometimes more by using cash on top of sales tax in most states. You can dislike cashless establishments, it's not doing anything. They get more sales because so few people carry cash. They have to pay to have an armored truck transport their cash. Technically it brings down the cost of goods to use credit and you get paid for using it (if responsible). Less likely to get robbed by a piece of shit. You guys should know this in the SFBA. Cost of goods go up for everyone after a register gets robbed.

We spend about $150k on the CC annually. We get about $20-30k of tax free benefits on stuff we needed to buy anyway for daily life and work. Let me know if that's stupid? Privacy is a shit argument. I could find anyone here with 1 or 2 pieces of data and your entire family. I won't, but I'm just saying all cash doesn't do anything. It's a pain in the ass to deal with.

I can just make one cash transaction, once a month with my CC payment. It's a bigger pain to go to an ATM or bank to get cash for daily expenses. If you're all cash you might be out of you're network and eat $4-8 in ATM fees to get your own money. If in an emergency I also want to have my cash when needed. The credit union thing is a pain in the ass if you travel at all. One extra layer of planning and hauling around more cash likely than you need to be safe. Just use a CC. It's way easier and you get paid.