I was seduced by the promise of 20% off my first order if I applied for the card. There is one supply item I use from the Pro Bulk Buy section that I use. It was out of stock for a long time and recently came back in so I thought I would jump on the credit card for the 20% off, it’s the only discount you will ever get with a Pro item. I applied, was accepted, placed the order, received the order. All is well.
I actually DID read the terms while I was applying but holy moly, woe to the person who does not read. The annual interest rate is 34.99%. I didn’t even know that was legal, LOL. The minimum monthly interest charge is $3, so if you are a penny short, that’s $3 to you. If you don’t sign up for paperless billing, they charge $2.99 a month for every bill mailed to you. So here I am, anxiously awaiting my card, so I know my account number, so I can sign up for an online account, paperless billing, and pay the balance before they send me a bill, in the mail, for $2.99 extra.
I saved $32 on my order, btw.
This is why I rarely sign up for credit cards. My banker did talk me into a US Bank credit card, though. It has a 4% cash back rewards for every single purchase. No fee. It was not a promotional offer.
I was told by another banker that the offer had the slimmest of windows; I was lucky to get it. They were losing too much money on it, so they cut it off.
My understanding is that the credit card companies pay for all those cashback rewards and points etc by charging higher fees for the merchants. The better the “rewards” for the customer, the more expensive it is for the merchant.
I can’t imagine a bank losing money on a credit card. They have decades of experience on how to milk every penny out of every card.
They bank on people just forgetting, or not getting their accounts set up in time.
I don’t even know my interest rate on my Amazon card because I pay it off every 2 weeks lol. But I’m sitting down doing the math and I’m thinking of switching to Costco card.
You really only need one credit card to maximize potential of rewards. Having a thousand little cards that once opened don’t really earn you much in rewards and then to have to remember to use that specific card when you go to that store. So many headaches.
I duuno. They were Visa/Mastercard. Does that count? I think the rate merchants pay is the same no matter which bank is on the card, no? So, if they pay Mastercard 3% and the card is giving back 4%, don’t they lose money? I’m guessing the bank pays the difference?
To be fair, interchange fees levied upon merchants vary greatly, depending upon multiple variables - in issuer policies themselves, card types, geographical restrictions (read: state/local laws), transaction types (in-person/B&M, online, payment method, etc.) and/or transactions volume, merchant categorization, MDR (credit-industry speak for “Merchant Discount Rate”), and more - which come into the calculation.
There’s a reason why Congress has cobbled together the U.S. Tax Code in the fey fashion it has - just as there’s a reason why the Accounting Industry has long proven to be typically immune to boom or bust, bull or bear.
If we were charging 24% or more in interest and we knew that not everyone pays their balance off at the end of the month and we knew how much we were making off of that interest each month, pretty sure we could calculate how much profit we could make by offering 4% back on every purchase to entice people to use our credit card.
The merchant processing fee of 3% (or whatever) is ultimately paid by the consumer as it is normally baked into the cost of the item or service (or even sometimes added in as an incentive to use some other form of payment … gas stations offer cash or credit card pricing).
With banks paying so little in interest now days, one can earn more on cash back credit cards if one can handle them properly (pay off the balance at the end of the month or before).
My wife’s TJMAXX visa has a $1.99 statement fee and I have taken it away from her.
I have taken over bill paying and I did not want another small balance payment each month anyway.
Somehow she was earning credits based on the charges on the cards she could use at TJMAXX, Marshalls and Home Goods and I told her we can afford anything she wants to buy so that was no loss.
All of our in person charges are on a Fidelity Visa which gives us 2% back and automatically transfers to one of our brokerage accounts.
Got to keep simplifying as we lose our mental capacity. Too many accounts for our various entities and identities.
We get a variety of promotional offers of up to 5% rewards at various types of stores and no longer even attempt to keep track of them.
Well, that’s what I do. I make money on my cards, because I don’t pay a fee for the card and then I get 4% back on every purchase. I pay the card off every month, so there’s no interest. They are losing money on me.
Every time I log into their website, the first thing I see is a popup asking me to go paperless. When I try, it says I am already enrolled in paperless.
Every time I speak to someone on the phone, they ask me if I want to go paperless. I tell them I’d love to, but when they try to enroll me, they tell me I already am. And yet they also get notifications when I call that I am not enrolled.
There is nothing I can do (believe me, I’ve tried) to stop them from sending me paper documents. If they were charging me for paper mail I would be outraged. As it is, I’m just annoyed.
Every 3 months the promo rates change, and Whozzit makes up a list which I carry in my purse. Card A 5% off on gas, Card B 3.7% off on groceries, Card C 4% off online purchases etc. etc.
We always pay on time. paid off our house in 1995 and have not had a dime in debt since.
That’s our “everything else” card which is constant 3.5%. This quarter (using 3 different cards) gas, groceries and online shopping are 5%. Whozzit keeps track of everything and hands me a list; otherwise, I’m not sure if I’d bother.
I know I would make more money doing it your way, but I organize my credit cards so I can keep track of stuff. One card is used only for subscriptions. I can take one look and know which subscriptions I’m on, so I won’t stay on a subscription because I forgot about it. Another card is just for internet purchases. Another one is for international travel, and the last one is for everything else.
