Credit card ?

[fasternyou929]

Originally Posted by Porkchop

Quick question on credit cards...

My statement dates run from March 14th - April 13th. My payment date is the 8th of every month. I have always carried a big balance so I never ran into this problem. On March 8th I paid the balance of my card in full, so my statement on March 13th shows $0. Fast forward to today. Today is the 8th of course and my payment day. Since I paid off the card, I have accrued $133.89 to date. I go on to make a payment and the site says I owe $0 because the statement of last month was $0. For the current balance of $133.89 does interest hit at the time of statement (April 13th) or after next month's pay date (May 8th).

So this is all leading to.... should I just pay it off today/before the 13th, or will I not have interest on that balance until next pay date?

Thanks!

You will not receive any interest charges if you do not make a payment this month. Somewhere in your credit card agreement there is a "minimum grace period" for all new purchases and it's usually on the order of 28 days or so.

What that translates to is: "thou shalt not accrue interest charges for at least xx days from the date of purchase." Thus, any charges you make through April 13th will not be subject to interest until you carry the balance beyond your May statement. If you pay your accrued purchases in full then, there will be no interest charges.

The only time you see this prolonged gap in payments on a credit card are 1. when you get a new card and 2. when you have a $0 on a previous billing cycle.

Paying your "statement balance" each month will not result in a $0, you're just paying the charges from previous month to avoid finance charges on them. In that scenario you will start making a payment each month and will not see the extended gaps in payment again.

BTW - congrats on paying off your cards!! Do yourself a favor and get a rewards card that offers you cash back or incestives for purchases you make regularly; you won't believe how much people are willing to give you for simply spending money with them. Now that you know how quickly you can get upside-down with CC's, you'll likely be responsible and will avoid repeating this scenario at all costs. Enjoy the feeling of having a massive weight lifted from your shoulders, and tons of extra discresionary income!

[tommymac]

Originally Posted by fasternyou929

You will not receive any interest charges if you do not make a payment this month. Somewhere in your credit card agreement there is a "minimum grace period" for all new purchases and it's usually on the order of 28 days or so.

What that translates to is: "thou shalt not accrue interest charges for at least xx days from the date of purchase." Thus, any charges you make through April 13th will not be subject to interest until you carry the balance beyond your May statement. If you pay your accrued purchases in full then, there will be no interest charges.

The only time you see this prolonged gap in payments on a credit card are 1. when you get a new card and 2. when you have a $0 on a previous billing cycle.

Paying your "statement balance" each month will not result in a $0, you're just paying the charges from previous month to avoid finance charges on them. In that scenario you will start making a payment each month and will not see the extended gaps in payment again.

BTW - congrats on paying off your cards!! Do yourself a favor and get a rewards card that offers you cash back or incestives for purchases you make regularly; you won't believe how much people are willing to give you for simply spending money with them. Now that you know how quickly you can get upside-down with CC's, you'll likely be responsible and will avoid repeating this scenario at all costs. Enjoy the feeling of having a massive weight lifted from your shoulders, and tons of extra discresionary income!

I guess the companies suck in enough people with rewards and other perks that they still make money with the high rates and on people who carry balances that its ok to have people like osp that milk them for as much as they can. I was doing that to a smaller degree with my card untill I had to rack up a balance. Plus in NY its not as beneficial with gas since many stations now charge more for credit vs debit or cash purchases.

[fasternyou929]

Originally Posted by tommymac

I guess the companies suck in enough people with rewards and other perks that they still make money with the high rates and on people who carry balances that its ok to have people like osp that milk them for as much as they can. I was doing that to a smaller degree with my card untill I had to rack up a balance. Plus in NY its not as beneficial with gas since many stations now charge more for credit vs debit or cash purchases.

Yeah, it's not a one-size-fits-all solution. NC hasn't started charging more for gas purchases on credit, so 5% back on that still translates to about $400 per year for me.

And even if everyone milked the CC companies like OTP, they would still probably make money. They skim off the top of EVERY single transaction they process (AmEx takes the most and it's why not everybody accepts them), so even on a rewards card where the balance is paid off monthly the CC company is coming out ahead. The rest is icing on the cake.

[tommymac]

Originally Posted by fasternyou929

Yeah, it's not a one-size-fits-all solution. NC hasn't started charging more for gas purchases on credit, so 5% back on that still translates to about $400 per year for me.

And even if everyone milked the CC companies like OTP, they would still probably make money. They skim off the top of EVERY single transaction they process (AmEx takes the most and it's why not everybody accepts them), so even on a rewards card where the balance is paid off monthly the CC company is coming out ahead. The rest is icing on the cake.

I would figure as much. Before we bought the house my wife racked up some serious CC bills (and with nothing to show for it) back then those balance transfers were free. I guess enough people were like me and took full advantage of them so the CC company made no money, then I saw they started tacking on fees for them, so at lest they were guaranteed to get soem money.

Its a mix with the gas stations here. A few charge the same price but others dont and within my area the price can vary by a smuch as 15 cents a gallon so I usualy go where its cheapest, but with the bike its easier to pay via Cc so I can fill up to whatever amt it is.

[shmike]

Originally Posted by fasternyou929

And even if everyone milked the CC companies like OTP, they would still probably make money. They skim off the top of EVERY single transaction they process (AmEx takes the most and it's why not everybody accepts them), so even on a rewards card where the balance is paid off monthly the CC company is coming out ahead. The rest is icing on the cake.

Yep. This is what so many people don't understand.

The interest that balance carriers pay is just gravy. Interchange fees are charged on every single transaction involving a credit card. These fees are paid by the merchant.

The companies charge a higher fee when they are giving out better benefits. So, if you paid $5 for your Subway on your no perks Visa, the company might only see $4.95. If you paid $5 on your 5% cash back Visa Subway might get $4.92.

The banks got in on this some years back which is when they all started pushing Debit cards. Then Barney Frank cut the fees the banks could get from debit card transactions (in 2010) and that's why you've seen so many new bank fees and higher minimums on "Free" bank accounts in the last few years.

And now you know...

[tommymac]

Originally Posted by shmike

Yep. This is what so many people don't understand.

The interest that balance carriers pay is just gravy. Interchange fees are charged on every single transaction involving a credit card. These fees are paid by the merchant.

The companies charge a higher fee when they are giving out better benefits. So, if you paid $5 for your Subway on your no perks Visa, the company might only see $4.95. If you paid $5 on your 5% cash back Visa Subway might get $4.92.

The banks got in on this some years back which is when they all started pushing Debit cards. Then Barney Frank cut the fees the banks could get from debit card transactions (in 2010) and that's why you've seen so many new bank fees and higher minimums on "Free" bank accounts in the last few years.

And now you know...

Seems like the gas stations are passing that fee back to the consumer, at least in NY, its usualy 8-10 cents a gallon higher than cash or debit and som elump debit in with the credit cards. And gas stations that chage the same for cash or credit tend to be a few cents higher anyway. I wouldnt be surprised if other merchants tried to do the same.

[Rangerscott]

Thats a lot of porn.

Im gonna look into a cash back card. Something back is better than nothing back.

[Homeslice]

Work stuff doesn't count
Seems like your employers should be issuing you corporate cards.

And if I was your utility company, I would refuse to accept CC because of the merchant fees. I'd require you to use auto-deduct from your checking account instead. And you wouldn't have any choice, because I'm the only game in town if you want your lights on.

Also, I get a 10% bonus in points at the end of the year

That's 10% of the points, right? So for example if you had earned a total of $1000 cashback, it's now $1100.

[OneSickPsycho]

Originally Posted by Homeslice

Work stuff doesn't count
Seems like your employers should be issuing you corporate cards.

And if I was your utility company, I would refuse to accept CC because of the merchant fees. I'd require you to use auto-deduct from your checking account instead. And you wouldn't have any choice, because I'm the only game in town if you want your lights on.


That's 10% of the points, right? So for example if you had earned a total of $1000 cashback, it's now $1100.

Work stuff does count... doesn't happen very often, but I buy some things for the sales floor every couple of months and travel 1-2x per year... all on card. Some have the corporate Amex, but I don't...

My electric company would charge me to use my CC... fuck that.

Yes, 10% of points. They used to give it to you every statement along with a point for every purchase... changed that a few months back.

[Homeslice]

Originally Posted by OneSickPsycho

My electric company would charge me to use my CC... fuck that.

I am surprised your water company lets you.

Businesses accept CC because they think it will help attract/retain customers due to the increased convenience. Restaurants for example. Even fast food places finally woke up and started accepting them because they realized they were losing customers who didn't have cash on them at the time.

But with a water company, there's probably no other game in town, so why should they offer that convenience at their expense?

Same with cable, I mean I really doubt people would cancel their Comcast if they were forced to use bank acct deductions instead of CC.