Community Chat

[SilleeMee]

I get money, save a little bit and spend the rest. Pretty simple.

[gertrudecloset]

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@Carmie wrote:

@gertrudecloset   Credit card companies never a cancel your card for  paying off the balance each month.  They love those customers.  If you can afford to pay off your balances, you are probabaly spending more money and charging monthly.

The CC companies charge the retailer a percentage of he purichase evey time you your card.   CC companies make money from each transaction you make on your card.  The fees are subtracted from the money the retailer gets.

For instance...you'll charge $40 for a hat. The retailer might only get $37 and the CC company keeps $3.

If you use a debit card, it works the same way, except the charge fees are lower.

CC companies will cancel your card if you don't use them enough.  It cost them money  to issue that card and keep your account and you are not bringing them any funds.

@Carmie 

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I can't say I agree that they like you pay off what you charge each time.  A lot of the time, sometimes, but not all the time.  There's no interest to be earned.  Considering the lower end of APR's being about 5% (all of this depending on your credit worthiness).  I just don't see the term "never" in there.  The primary way the make money (Master Card, Visa, Discover) is by charging annual fees and their interest rate which is paid over the life of your balances (they want you to carry).  If you're not carrying a balance where they can tack on that 10% APR or as in some store cards 23% and up, what's in it for them?

I'm not credit expert, but it doesn't make sense to me.  Maybe over the weekend, I'll research this.  If they aren't making money from you then they don't need you.  I dunno....but that's how I always thought of that.

[skatting44]

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@World Traveler wrote:

In my humble opinion, this seems like a very personal question to ask people to respond to. What is the purpose?

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  Did you respond the same to the post  by another person  titled  " When did you hit menopause ?"  To me that is another  example  that may receive the same response . I've seen other posts  that I felt intrusive,  however it's up to me if I respond or not . 

[

[gertrudecloset]

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@aroc3435 wrote:

@Carmie   The original, traditional AMEX charge card is the one I am describing.  They did expand and offered an Optima card at one time that might have later been discontinued.  Probably now have a credit card division--would not surprise me.

aroc3435

Washington, DC

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I remember that card.  I never applied, for it, but I remember it.

[gertrudecloset]

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@froggy wrote:

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@gertrudecloset wrote:

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@froggynot all cards offer cash back.  You know one does have to "shop around for good rates and perks for their credit cards.  And you must have excellent credit to get the good cards don't you?

@gertrudecloset  I didn't say they did. My point was that the CC companies make money whether or not they give rewards or whether you pay the balance every month.

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@froggyHow are they making money if you don't pay their exhorbitant APR's?  Don't say merchant fees because that doesn't even come close.

[gertrudecloset]

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@SilleeMee wrote:

I get money, save a little bit and spend the rest. Pretty simple.

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Me too!  I do use my Charge Card, though.....

[happycat]

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@gertrudecloset wrote:

Won't these "paid off credit cards each month" soon be cancelled?  I mean the companies aren't making any money off of your spending habits (if you Pay it off each month).  They make money by charging you interest and carrying a balance.  Charge cards are better for closing your balance at the end of every month.  Credit Card issuers expect you to carry a balance (at some point) in order to make money.  Yes, they will close your account if they don't make any money off of you via interest and the APR.

Everyone knows this.

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I've been paying off discover monthly, some months didn't charge anything on it, for years. I don't think they cancel a person for paying it off monthly. 

[Porcelain]

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@skatting44 wrote:

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@World Traveler wrote:

In my humble opinion, this seems like a very personal question to ask people to respond to. What is the purpose?

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  Did you respond the same to the post  by another person  titled  " When did you hit menopause ?"  To me that is another  example  that may receive the same response . I've seen other posts  that I felt intrusive,  however it's up to me if I respond or not . 

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We can also respond in any way we like. For example, by saying it's an intrusive question.

I would recommend that people not provide too much detailed financial information on a public site like this. Little bits of personal information you leak out in other responses, when combined together, can make it possible for you to be targeted by people who may not have your best interests at heart.

[Carmie]

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@gertrudecloset wrote:

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@froggy wrote:

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@gertrudecloset wrote:

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@froggynot all cards offer cash back.  You know one does have to "shop around for good rates and perks for their credit cards.  And you must have excellent credit to get the good cards don't you?

@gertrudecloset  I didn't say they did. My point was that the CC companies make money whether or not they give rewards or whether you pay the balance every month.

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@froggyHow are they making money if you don't pay their exhorbitant APR's?  Don't say merchant fees because that doesn't even come close.

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The big CC companies  are making millions every month from these percentages they take.  People are using the cards 24/7/365 all over the world.  They make so much they give you cash back.

Think big as in millions and millions of dollars spent and fees collected.

[gertrudecloset]

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@happycat wrote:

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@gertrudecloset wrote:

Won't these "paid off credit cards each month" soon be cancelled?  I mean the companies aren't making any money off of your spending habits (if you Pay it off each month).  They make money by charging you interest and carrying a balance.  Charge cards are better for closing your balance at the end of every month.  Credit Card issuers expect you to carry a balance (at some point) in order to make money.  Yes, they will close your account if they don't make any money off of you via interest and the APR.

Everyone knows this.

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I've been paying off discover monthly, some months didn't charge anything on it, for years. I don't think they cancel a person for paying it off monthly. 

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@happycatThey are private entities that can do what they want.  They can increase your credit limit while you have the card, they can decrease your limit while you have the card, they can re-check credit reports and close your accounts.  They can close your accounts when you are not making $$$ for them as a company.  They can do what they want.  You might have to just go some where and find you a new card, but they can do what they want (as long it's not against the law).