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Post by Spongemom Scrappants on Jul 4, 2024 16:22:39 GMT
I just had to look up the interest rate on my primary credit card. Embarrassingly, I didn't know it because I don't use it as I pay off my balance each month.
And wow! Almost 35% is ridiculously high for a store credit card. No wonder so many get in debt over their heads before they know it. I cringe every time I am waiting behind someone signing up for another store card to get the measly little discount on that day's purchases. It's a losing proposition for most.
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Post by chaosisapony on Jul 4, 2024 16:30:17 GMT
Wow. I paid off the last of my credit card debt in 2020 and I have vowed to never go down that road again. If I use a card now it's just because there is a discount involved. I think most of my cards have rates in the high 20s now, I want to say I got a notice for Maurice's recently that was 28.99%. I was shocked. No wonder it's nearly impossible to pay off credit card debt.
I've also noticed some of my rewards cards starting to reduce the rewards programs which is a shame.
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Post by mollycoddle on Jul 4, 2024 17:03:52 GMT
Wow. I paid off the last of my credit card debt in 2020 and I have vowed to never go down that road again. If I use a card now it's just because there is a discount involved. I think most of my cards have rates in the high 20s now, I want to say I got a notice for Maurice's recently that was 28.99%. I was shocked. No wonder it's nearly impossible to pay off credit card debt. I've also noticed some of my rewards cards starting to reduce the rewards programs which is a shame. Paying off your credit card is a real accomplishment. 👏🏻 |
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Post by LavenderLayoutLady on Jul 4, 2024 17:05:33 GMT
Retail credit cards are a trap. Shop where you can afford to pay outright. This is true.
Last week I bought eye drops at Walgreen's in person. The cashier asked me if I wanted to apply for a Walgreen's credit card. I was shocked they even have a credit card!
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Post by bratkar on Jul 5, 2024 11:41:20 GMT
A few months ago, I used a 'store' credit card I had not used in a really long time. The store no longer has a store front but still maintains a web presence. I got the bill which I always paid off in the past, looked just to see and saw that their interest was 39.99%. Its not even worth having period at this point. They used to offer perks and discounts, but as far as I know, that is no more. So I'd rather use my travel MC/V to earn points and have that benefit.
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Post by smasonnc on Jul 5, 2024 18:04:19 GMT
Yikes. These interest rates sound like what a loan shark would offer. They must have a lot of people who default. We've been preaching to our kids and anyone who would listen not to have too many cards and NEVER EVER carry a balance. Even my eldest daughter who doesn't make much money lives very frugally and never carries credit card debt. It doesn't make a difference to me but it sure does to many other people who can't pay their bills for whatever reason. There are too many people who get trapped in credit card debt because it's too easy (I need some "retail therapy"!) and they don't understand the risk. All they worry about is the minimum payment. Very sad. Credit card companies make their money from the customers who make minimum payments each month. They also protect customers from fraudulent charges and have to eat losses when customers don't pay. My son used to do mathematical modeling for Capital One designing credit card terms for companies like Home Depot and Menard's. The objective was that it would be attractive to customers, profitable for the company, and ensure that the borrower is likely to pay back what they charged while sometimes carrying a balance. The interest rate is based on the risk of not being paid back. |
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hutchfan
Drama Llama
Posts: 6,609 
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Post by hutchfan on Jul 5, 2024 18:43:27 GMT
Thankfully I don't have any retail credit cards and I paid my credit card bill off 2 months ago. When I use it now I pay the balance immediately. We paid our vehicle off last month.
Trying to be better financially.
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Post by nightnurse on Jul 5, 2024 18:51:31 GMT
Yikes. These interest rates sound like what a loan shark would offer. They must have a lot of people who default. We've been preaching to our kids and anyone who would listen not to have too many cards and NEVER EVER carry a balance. Even my eldest daughter who doesn't make much money lives very frugally and never carries credit card debt. It doesn't make a difference to me but it sure does to many other people who can't pay their bills for whatever reason. There are too many people who get trapped in credit card debt because it's too easy (I need some "retail therapy"!) and they don't understand the risk. All they worry about is the minimum payment. Very sad. Credit card companies make their money from the customers who make minimum payments each month. They also protect customers from fraudulent charges and have to eat losses when customers don't pay. My son used to do mathematical modeling for Capital One designing credit card terms for companies like Home Depot and Menard's. The objective was that it would be attractive to customers, profitable for the company, and ensure that the borrower is likely to pay back what they charged while sometimes carrying a balance. The interest rate is based on the risk of not being paid back. I think that’s how it USED to be but more and more companies are using the excuse of inflation to do things like raise the rates. Amex didn’t have too many people defaulting. They reported record revenue last year. This isn’t them mitigating a risk, this is corporate greed, plain and simple. www.americanexpress.com/en-us/newsroom/articles/financial-news/american-express-announces-record-full-year-2023-revenue.html |
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Post by lisae on Jul 5, 2024 19:18:21 GMT
I started to answer this as supposing that Macy's was doing this because they have been in trouble for years and it was the way they were going to increase their cash flow. I decided though to compare them to other store credit cards which are a lot higher than your regular Visa and Mastercard.
Here is what I found
Talbots - 35.99%
LL Bean - 21-32% depending on your credit worthiness
Sephora - 23 1/4 or 32% depending on your credit worthiness
Old Navy and Kohls - 30.99%
I could have kept going. Those were just some stores that came to mind. Avoid store credit cards or be diligent about paying them off each month.
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