What's the best credit card deal today?

[skaredshtles]

If you're already a Costco member and want an easy straight cash option then Costco Citi for gas/restaurant/travel/Costco + Citi Double Cash (blanket 2%) for everything else is what I roll with.

Yup - I like to keep it simple and just get a big fat check in February.

[Lvovsky]

Just approved for the Ink Business Preferred. Puting $8k on it in 3 months might be a stretch though.


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Keep an eye on doctor of credit website: they post when Staples has visa gift cards with no activation fees to help meet the 8k spending. Ask friends and family if they need to make any large purchases, put it on a card and get cash from them. Book vacation, get ski pass, new tires, skis, bikes, tools - this is the three months to do it…

[fomofo]

Don't usually find myself aligned with Josh Hawley, but I'm glad this issue is at least being aired out in public. I'm not sure anything will come of it, but only time will tell.

[Mustonen]

He’s an idiot and he’s ignorant and THAT should be inexcusable to anybody who cares about this. The core points aren’t wrong and I’m sympathetic to most, but he’s attacking the wrong people with the wrong arguments. That would be like dressing down ski manufacturers for high lift ticket prices.

[gravitylover]

What's the best rewards card for gas purchases now? I saw one recently that's was 5% and I didn't jump so, of course, now I don't remember which one it was.

[byates1]

Stablecoin systems should make cc companies almost vanish in the near future

[liv2ski]

What's the best rewards card for gas purchases now? I saw one recently that's was 5% and I didn't jump so, of course, now I don't remember which one it was.

I like air mile cards with big up front bonuses, as in 60k plus miles. I have a Chase Platinum card, I forget what it's called but the annual fee is pricey. We just use that for two business class tickets to Europe. Now that I burn through that 300,000 MILES I signed up for a new Mastercard, sorry I forget which company, but Google MasterCard $75,000 mi bonus and you'll likely see it. It had really good miles per category and was only $95 a year.
I thought I saw PayPal offered a card with a 5% cash rebate but I wouldn't get that.

[jm2e]

]][emoji6][emoji6][emoji[emoji6][emoji6]]]What's the best rewards card for gas purchases now? I saw one recently that's was [emoji6]% and I didn't jump so, of course, now I don't remember which one it was.

Costco Card. Unless you drive a hybrid or a motorcycle, I think it’s a no brainer.
Closest Costco to me is hrs away, but i got $[emoji6][emoji[emoji6][emoji6]] last year from just gas. To be clear, the % is not just on Costco gas. Pretty much any gas not connected to a supermarket or warehouse.


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[NBABUCKS1]

Stablecoin systems should make cc companies almost vanish in the near future

oh brother

[alpinevibes]

What's the best rewards card for gas purchases now? I saw one recently that's was 5% and I didn't jump so, of course, now I don't remember which one it was.

Citi Custom Cash card allows you to select your top spending category and get 5% cash back on that category, which could be Gas Stations. Max of $500 spending at 5% each month. No Annual Fee.

You're in the NE so you sould be able to get a AAA Travel Advantage Card that should offer 5% cash back on gas. No Annual fee and might have a $100 sign up bonus after $1000 spend.

If you qualify, the USAA Cashback Rewards Plus American Express® Credit Card gets 5% cash back on gas for up to $3000 per year.

The Citi Shop Your Way Mastercard could potentially be the best deal. 5% points on gas, plus they appear to send out 10% additional offers out quarterly, so some people are getting 15% back. Plus $225 in statement credit for spending $1500 in the first 3mo.

Costco and Sam's have 4-5% deals on their cards, but you have to pump their gas for that.

[Danno]

Costco and Sam's have 4-5% deals on their cards, but you have to pump their gas for that.

not true for Costco at least. Any gas station that is coded as a gas station gets you the 4% (so supermarket gas stations do not).

But thanks for the great list! Edit: just looked at the "shop your way card" and while it seems good, be aware that you cannot redeem points for cash/statement credit, it has to be for gift cards and the like (but maybe visa gift cards).

[singlesline]

He’s an idiot and he’s ignorant and THAT should be inexcusable to anybody who cares about this. The core points aren’t wrong and I’m sympathetic to most, but he’s attacking the wrong people with the wrong arguments. That would be like dressing down ski manufacturers for high lift ticket prices.

Yeah, WTF is with his digression into interest rates and debt? I can't tell if he's just an idiot or if he is just looking for a grandstanding opportunity. Visa/MC have nothing to do the debt carried on the cards.

They do earn a % whenever a customer overspends their budget...but that's got to be a marginal benefit at best, especially since once that customer is in debt and paying 20% APR to the bank (which Visa earns nothing from)...they have less money to make future purchases.

All that interest going to the bank is money that Visa is NOT earning money on...they'd probably prefer customers only be slightly in debt (just enough to keep you tied to the card, but not so much that you put it in the freezer or can't make your budget work). Their favorite customer is probably the one that overspends once or twice a year, but pays it back within a few months. That person is going to keep that card forever, is going to use the card for the majority of their purchases, and is likely spending a high % of their income rather than saving.

[mattig]

US Bank's new "Smartly" card is out. Up to 4 percent back on all purchases without having to worry about stupid categories. You need a big savings account to get the 4 percent. Otherwise, it's just 2 percent. Probably makes most sense for existing US Bank customers who already have savings accounts there.

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[Danno]

Yeah, WTF is with his digression into interest rates and debt? I can't tell if he's just an idiot or if he is just looking for a grandstanding opportunity.

This is Josh Hawley, the answer should be obvious. (he's a Stanford and Yale Law grad and former Supreme Court clerk, he's no idiot).

[Mustonen]

Yeah, WTF is with his digression into interest rates and debt? I can't tell if he's just an idiot or if he is just looking for a grandstanding opportunity. Visa/MC have nothing to do the debt carried on the cards.

His digression about interchange is similar, though that’s a price that networks at least negotiate between issuers and acquirers even if they don’t earn the proceeds.

They do earn a % whenever a customer overspends their budget...but that's got to be a marginal benefit at best, especially since once that customer is in debt and paying 20% APR to the bank (which Visa earns nothing from)...they have less money to make future purchases.

I don’t think that’s true. And I’m pretty certain about that, mostly because that’s data the networks simply don’t have access to AND that’s not a line item I recall ever seeing. I’ve been wrong before though.

Fees earned by networks are flat and are paid by issuers and acquirers (merchants). They just want those swipes and don’t have much interest in spenders vs savers. As a percentage of money changing hands their take is tiny. Still earning money hand over fist. Curious what the profit margin is supposed to be for their business, though? Or for any business? Payment network to retailer to financial institution is not exactly apples to apples.

[fomofo]

Yeah, WTF is with his digression into interest rates and debt? I can't tell if he's just an idiot or if he is just looking for a grandstanding opportunity. Visa/MC have nothing to do the debt carried on the cards.

Maybe he's fronting for some entity that wants to get into the card network end of the business. Several pieces in this pie.

For the consumer clearly the most egregious transgressors are the banks with their absurdly high card interest rates. I've often wondered "why do they charge so much?", but we all know the answer: Because they can/because they have highly paid lobbyists killing, influencing, or actually writing legislation.

One question I would like an economist-type to answer would be what would a reasonable range for credit card rates be. As things stand now it seems to be in the neighborhood of 10% over the prime rate (currently 7.75%) for customers with the best credit scores. For those with less sterling credit the interest rates are much higher, (Hawley cited an average rate of almost 29% !!), and if you spit on the sidewalk, (ok, maybe be late on a payment), the sky's the limit.

It seems that range could be lowered to some degree and still allow the banks to make a reasonable profit. If someone in leadership wanted to be loved by the public, and free up a tremendous amount of money to be pumped back into the economy, (starting with rent, food and gas), cutting credit card interest rates might be the lowest hanging fruit out there.

Bernie/Hawley bi-partisan sponsored legislation?

[singlesline]

I don’t think that’s true. And I’m pretty certain about that, mostly because that’s data the networks simply don’t have access to AND that’s not a line item I recall ever seeing. I’ve been wrong before though.

I just mean that they spend more and thus Visa earns more.

Customer has $3k to spend this month but puts $5k on the card. That's an extra $2k in spending that Visa earns fees on.

Visa doesn't need to know whether or not the customer can actually afford 5k, they just see 5k in transactions come through.

But like I said, that might work against them next month as the customer now has to start paying the bank back...so they might make less discretionary purchases with their card.

[Mustonen]

It’s unsecured debt. To figure that out you’d need to account for the yield net of charge offs. Some higher risk lenders (capital one, et al) have charge off rates well over 5%. The economics are fairly simple. Profitability = gross yield minus charge offs minus cost of funds minus operating expenses.

So, yield is a function of weighted average interest rate on all outstanding balances (keep in mind large chunks are interest free for those who take advantage of grace periods) less the amount that are charged off due to default, less the amount it costs to raise and maintain those funds (interest paid on savings accounts, etc.).

When rates go up, rates go up.

Operating expenses include fraud losses (which can be anywhere from 0.5% to over 1% of outstanding balances), general issuer costs (that card isn’t free), etc. Plus liquidity costs (maintain a percentage of contingent liabilities, or unused lines of credit, on the books).

Rewards and perks (topic of this thread) is defrayed by interchange, but the richer perks bleed into program profitability. Airport lounges aren’t funded solely by interchange income.

Large issuers make a nice chunk of change on portfolios. Smaller issuers maintain it as a service to their client base and to provide an option to consumers.

The other thing to keep in mind is that capping interest or interchange or fees will result in less availability of credit. Maybe that’s good? It also spells the end of the topic of this thread, or at least a substantial belt tightening. 5% cash back? Good luck. We’ve already seen those get cut back directly as a result of interchange caps.

To be clear, I’m not against it, but the law of unintended consequences is far reaching here.

[singlesline]

One question I would like an economist-type to answer would be what would a reasonable range for credit card rates be. As things stand now it seems to be in the neighborhood of 10% over the prime rate (currently 7.75%) for customers with the best credit scores. For those with less sterling credit the interest rates are much higher, (Hawley cited an average rate of almost 29% !!), and if you spit on the sidewalk, (ok, maybe be late on a payment), the sky's the limit.

I'm an economist-type, but I don't really have a good answer.

I think there are a lot of factors at play that suggest that something like 20% probably is reasonable.

Lets just set aside the predatory aspect (knowing you can catch financially naïve people and then milk them for fees/interest). Credit card debt is pretty risky from the bank's perspective. It is an unsecured revolving credit line. They give it to you fairly blind, have no assets to back it up, and they have zero say on what you spend it on.

And then, by its nature, it is a credit line that is going to be used only by people who are having trouble coming up with cash. Nobody uses a typical credit card to smooth out a large purchase unless there are no other options they can come up with (in store 0% financing, a home equity loan, a personal loan, even something like Klarna are all better). If you are putting a $3k car repair on a credit card and planning to pay it off in 6 months...it is because you don't have any other options.

And why don't you have any other options? Some mix of: You don't have any savings to pay it from (so you are relying 100% on future income...which may not be guaranteed). You don't have sufficient credit or proof of income to qualify for outer sources. Your budget is blown up by too many other bills/payments. You lost a source of income. You are a shopaholic who can't budget. You had one thing go wrong and those often compound (e.g. your car broke so you had to miss a shift at work...and because you missed a shift, that overtime shift you were expecting to work at time-and-a-half only gets paid at straight time).

There's an adverse selection problem--the people most likely to get stuck paying interest are the people who are the least likely to be able to pay it off.

So you know that a decent share of your customers will get in too deep and default. The problem is that you don't know which customers those are--you just don't know that much about customers or their spending habits, and many of the events that can drive credit card debt are random (a broken car the same month that your kid has a pricey ER visit). But half of your customers won't ever pay a cent of interest because they will never carry a balance...so you make almost nothing off them. Hell, I don't even know the APR on any of my credit cards--I literally don't look at it when applying for a new card because I never plan to carry a balance.

So what's the fair rate for that kind of unsecured debt? Personal loans for people with good credit are in the 9-16% range right now. Drop down another credit band and you are already at 17-20%. And those loans give the bank a chance to say no--they get to look at you the MOMENT you are asking for money and make a decision. Credit cards can be issued years in advance and they don't get a lot of info about you after application--they know if you pay your bill, and sometimes they ask you income verification questions that you may not even respond to. The bank doesn't get to ask you to come in and talk to a manager for every big purchase on your card. Credit card rates are going to be higher than personal loan rates no matter what because they have to account for the extra risk

Then add in some predatory behavior and you're at 30% plus as many fees as possible.

[teleee]

Wait a minute I thought Mustonen threw a temper tantrum and was pulling a Benny never to return? Man it’s hard to keep up around here with the dramas.


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[Mustonen]

Not really. But reinstalled the app to find mount point discussion on my R110.

Good point though. Fuck you. Back to tech talk with me.


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[jm2e]

US Bank's new "Smartly" card is out. Up to 4 percent back on all purchases without having to worry about stupid categories. You need a big savings account to get the 4 percent. Otherwise, it's just 2 percent. Probably makes most sense for existing US Bank customers who already have savings accounts there.

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2% base rebate.
2% extra rebate if you keep a balance of $100k in your savings account? Really? Is that a thing? Does that make sense for anyone?


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[mattig]

2% base rebate.
2% extra rebate if you keep a balance of $100k in your savings account? Really? Is that a thing? Does that make sense for anyone?


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Only for dentists who keep that much in a savings account, and only while savings accounts have decent yield.

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[Danno]

Not really. But reinstalled the app to find mount point discussion on my R110.

Good point though. Fuck you. Back to tech talk with me.


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eh, we all have meltdowns of a sort from time to time. No need to disappear because of it.

[skaredshtles]

2% base rebate.
2% extra rebate if you keep a balance of $100k in your savings account? Really? Is that a thing? Does that make sense for anyone?

Almost assuredly not. Unless US Bank is paying competitive rates on that savings account... which i doubt *greatly.*