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Comment by oneplane | Hacker News Reader

My first reaction was: why do they mess with what people do with their money. Then I remembered that the way credit cards are used in a lot of places is not actually the money of the account holder.

Where I live, debit cards are the standard, and credit is rarely used, rarely accepted, and rarely something you can endlessly lend with. SO when I read "Bank X wants to mess with transactions Y" in my context it's like someone telling you what you can do with your money, but since it's credit, not debit, it's the bank's money and it's pretty reasonable that they get to say what you can use it on.

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In the US if you have your finances in order there is 0 reason not to use a credit card on everything (where you aren't charged extra to do so) as most credit cards offer a rewards system. For example I have a card that rewards 1.5% back on every purchase and I have it setup to pay in full at the end of every month. Doing this allows me to never pay interest but basically get a 1.5% discount on every purchase.

Finances in order and have the willpower not to spend money you don't have, just because you can. Some people lack that, and it's smarter for them to just avoid the constant temptation by now having a credit card.

Is there a secured card with cash back? Seems like a good option for such people.

Discover has a secured card that earns cash back.

Charge cards offer great cash back but are not "secured."

You can absolutely spend money you do not have, but only for one month, and then your account is closed and probably hit with massive fees.

IMHO if you haven't conquered the willpower part, you don't have your finances in order by definition.

When people say to use a credit card to buy everything they typically mean using it in pace of your debit card: only spending money you actually have right now and could pay off instantly and never carrying a balance. You're in it to rake in fraud protection, rewards, and a higher credit score for if/when you want to buy a house or car.

You don't even think about the idea that there's a line of credit attached to the card that extends longer than 30 days.

Chase lets you configure the payments to pay in full every month. I was very surprised to see this, as the bank ideally wants you to pay the minimum and interest.

Also one thing people often forget if carrying a balance - if you have balances with two different interest rates (say cash advances or balance transfers first vs. purchases or if the card issuer has raised the interest rate for purchases after a certain date) they would like you to think that "any payment above the minimum goes towards the highest interest balance" means that the whole of the given payment goes towards said balance. In point of fact, only the amount of the payment above the minimum does, the rest goes to the lower interest balance. This can sneak up on people who don't actually read their statements and destroy any form of credit progress.

And it's awesome. I haven't missed a credit card payment since I switched to a Chase card.

Previously, in a decade or 2, I think I missed 2-3 payments due to mistakes on my part. Not horrible, but certainly embarrassing and wasteful.

Because credit cards are different than debit cards - the bank is exposed on the money they lend in the CC transactions. If there is fraudulent activity associated with certain transactions and it's costing the bank, they're going to make the business decision to ban it. They're not limiting their customers debit cards purchases.

>Where I live, debit cards are the standard

In America debit transactions are treated differently. Since the money is deducted immediately, if there is fraud you could see your rent money tied up for 30-60 days.

Thus it is prudent to pay for everything with credit cards.

I actually take it a step further and have two checking accounts - one that my paycheck goes in, and one that I keep a couple thousand in specifically to withdraw at ATMs. That way if there is fraud, I've only lost a small bit of money and my bills will be able to be paid.

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