You need to have a form of credit, like a credit card. Even if you pay it in full every month, that’s still debt. In my native country almost nobody owns credit cards, just debit cards. I’ve been living in the US for 12 years now, building credit wasn’t that hard, but it took several years, I have almost perfect score now and own a house, but the whole idea was dumb to me too when I started. And I still need to remind my wife that the money in our bank accounts is not really how much we have, because we need to subtract credit card balances out of it.
Are we from the same country? Debt is something I don’t understand unless for a home or a car. If I have money to buy a tv, I pay in advance, or I wait until I have the money. I am not judging different points of view, just this is how I was raised
If you have $500 for a few TV, and you want a positive credit score, buy the TV with a credit card. Then, before the interest kicks in, pay off the credit card.
Well, this it ignores the external costs. Companies are charged by the credit processors and those fees get passed to customers. Some vendors will explicitly charge more for credit, but most vendors just raise prices for everyone. The amount of money you get in points doesn’t cover the added costs.
You’re not wrong… but as you said, those are external costs. While it’s fine to wish for a simpler, more equitable system, given that the prices are mostly the same no matter how you pay, wouldn’t you rather be part of the group receiving the benefits? Paying with cash or check or a non-reward card is leaving money on the table. The cost of handling cash and checks isn’t necessarily any lower than credit card processing fees and people don’t have much tolerance for strange new forms of payment, which leaves merchants without much leverage to push back against rules which prevent them from passing on the higher costs of the reward cards to those using them.
I just wanted to make sure that the 4chan OP wasn’t referring to debt as carrying a balance and paying interest. I know two people who were previously under this incorrect assumption and basically giving away money for free to their credit card companies.
You need to have a form of credit, like a credit card. Even if you pay it in full every month, that’s still debt. In my native country almost nobody owns credit cards, just debit cards. I’ve been living in the US for 12 years now, building credit wasn’t that hard, but it took several years, I have almost perfect score now and own a house, but the whole idea was dumb to me too when I started. And I still need to remind my wife that the money in our bank accounts is not really how much we have, because we need to subtract credit card balances out of it.
Are we from the same country? Debt is something I don’t understand unless for a home or a car. If I have money to buy a tv, I pay in advance, or I wait until I have the money. I am not judging different points of view, just this is how I was raised
If you have $500 for a few TV, and you want a positive credit score, buy the TV with a credit card. Then, before the interest kicks in, pay off the credit card.
Rinse and repeat.
It’s a stupid fucking game, tho.
I live in a place where I don’t need credit score, luckily…
But it’s free debt. You’re losing money by not using a credit card. Points
Well, this it ignores the external costs. Companies are charged by the credit processors and those fees get passed to customers. Some vendors will explicitly charge more for credit, but most vendors just raise prices for everyone. The amount of money you get in points doesn’t cover the added costs.
You’re not wrong… but as you said, those are external costs. While it’s fine to wish for a simpler, more equitable system, given that the prices are mostly the same no matter how you pay, wouldn’t you rather be part of the group receiving the benefits? Paying with cash or check or a non-reward card is leaving money on the table. The cost of handling cash and checks isn’t necessarily any lower than credit card processing fees and people don’t have much tolerance for strange new forms of payment, which leaves merchants without much leverage to push back against rules which prevent them from passing on the higher costs of the reward cards to those using them.
That’s fair. It absolutely is a debt.
I just wanted to make sure that the 4chan OP wasn’t referring to debt as carrying a balance and paying interest. I know two people who were previously under this incorrect assumption and basically giving away money for free to their credit card companies.