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Comment by GPerson | Hacker News Reader

“Most people have had the experience of wanting to buy something unplanned and not having the cash on them, but buying it anyway via credit card.”

I believe you, but this experience is totally alien to me and I don’t know of anybody who has done this. I wonder if it’s a generational thing.

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I was confused by this (because I rarely carry cash) until I saw your response below. I think OP might be using credit/debit card interchangeably? I don't use my credit cards unless I have to, but my debit card is used daily.

Are you in the U.S.? As an American I use a credit card for nearly 100% of my purchases, on a daily basis. I pay my bill in full each month. I might pay a 2–3% surcharge on a subset of those purchases, but I am reasonably sure I get more than that back in rebates. My Amex offers 2% back on groceries and the grocery store doesn’t charge extra for credit card purchases.

I basically never use my debit card for anything but ATM transactions, and the only time I have any cash in my wallet is when I have recently gone to a cash-only bar or to Las Vegas.

I default to credit/charge cards over debit cards because, in my country, debit cards offer far less consumer protection than credit cards.

Literally between posting the above and now, I went to a rural bike ride with my family. Didn't bother to bring cash. Ended up riding past an antique shop and bought my son an old school tractor toy via Google Wallet.

But with a debit or credit card?

Credit card. I never understood the point of debit cards. It's like for people who don't want points? :)

Also I've often heard, and now seen one example myself, that it's easier to dispute a credit card transaction than a debit card transaction.

I am almost 50 years old and I struggle to imagine anyone younger than I am being any more familiar with what cash is than with what a landline is

how much cash do you walk around with?

I just use debit cards and Venmo for everything. I’ve never understood why I’d use a credit card when I can just use the debit card and pay no fee. I’ll never afford a house anyways so the credit score argument is meaningless to me.

fwiw there is still a fee involved, usually just much lower so the merchant eats it

In the US debit card fees are capped (https://www.federalreserve.gov/paymentsystems/regii-average-...). The cap is low enough that there isn't enough to fund rewards like we see on credit cards. IIRC there were debit card rewards when they first came out but those went away with the fee caps.

So we're on topic: as the article points out - I use cash back cards so other people (like you) subsidize my spending. There are other major benefits to using a CC but anyway..

You are, apparently, well-off enough to have enough money in your venmo/checking where you don't think about it too much but I think the OP was referring to the less well-off but common situation where you are spending a little over your current ability - be it physical cash on hand (not your situation) or the amount available in your account.

I honestly don’t know what you’re talking about. I’m juggling a few hundred dollars in my checking account all the time. Is that well off? I don’t think so.

it is trivial to find a credit card with no fee and 1%-3% percent cash back.

Imagine everything you bought in the past 3 decades from grocery to hotel room and air travel. Now imagine having 2% of it in your pocket.

that's eaey to understand right?

additional benetit like purchase protection, vendor disputes, etc.

Okay I can understand that. I thought credit cards had fees. What’s the point of the free money credit card?

There are plenty of credit cards in US with 2% cashback on any transaction and no fees if you pay bills on time (usually 20-30 days after statement closes). Some of them even throw in small sign in bonus.

As I understand it the cc company takes the fee money from the buyer and it's usually more than the cash back and gambles with it until they give some cash back to the buyer and then pockets the rest. If you have millions of those transactions taking place then you have a huge pool of gambling money available. They also hold the sellers money for a while usually longer than necessary to also boost that pool. Edit: a less cynical view is that you are essentially loaning that money to the credit card company and then it pays you back but it keeps the interest

//Edit: a less cynical view is that you are essentially loaning that money to the credit card company and then it pays you back but it keeps the interest

It's literally the opposite. The credit card lends you money for free - if you pay your bill every month.

That's the "credit" in "credit card" - they are extending a line of credit to you, not the other way around.

One big reason to use credit card is that it gives window to settle problems. You have month to charge back before have to pay bank. If hotel places hold, it comes out of the credit limit not your bank balance. If someone makes fraudulent transactions, it isn’t your money and you can still pay rent.

If you pay the balance on time, you are getting free liquidity from the bank. But they get if you don’t pay off the balance.

Our family uses credit cards for everything. We don’t pay fees, the merchants do. We get the benefit of being able to settle disputes easily, getting cash backs, having extra insurance on certain goods, and not having to carry any easy-to-lose cash. We don’t spend more than we can afford, and we pay in full at the end of the billing cycle.

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