As for your comment “...Credit Cards are the source of misery for literally millions and millions of people unable to escape its clutches...”, should auto manufactures cease making cars because 60,000 folks per year are either injured, maimed, bunglers and robbers use them for ill gotten deeds, or worse folks are killed in them? Cedit cards have a positive use for millions folks as well. Regardless of Apple offering credit cards, financially irresponsible folks with or without credit cards will remain broke, in debt, and the like. As for being “....desperate to start exploring new sources of revenue...”, of course any and all companies are as well. Business are in business for generating money for themselves and shareholders, they are not a benevolent society. Even nonprofit organizations must generate money, profit, if they do not they would not remain in business.
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Apple Card Won’t Support Multiple Users, No Cost Associated With Physical Card
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Most people have trouble thinking about a life outside of their own. If something doesn't work for them, then it obviously won't work for anyone else, so it's trash.
Bottom line... this card is not that ground breaking. But what it does do is incentivize the use and acceptance of Apple Pay - that's the ultimate goal here for Apple. Get more merchants accepting Apple Pay and get more people using it.
Not that I can remember. Chip and pin took off fast in the uk. Haven’t written a cheque for over 10 years either. Don’t know if anyone issues them either. No shops will take them anymore around here.
Quick question:
I currently have some regular accounts linked to auto-pay each month from my current card (phone, internet, Directv, WeEnergies, etc.)
If the Apple Card generates a virtual number as well as the 3-digit security code, will the same numbers work the next month my bills want to access my credit card to get paid?
I currently have some regular accounts linked to auto-pay each month from my current card (phone, internet, Directv, WeEnergies, etc.)
If the Apple Card generates a virtual number as well as the 3-digit security code, will the same numbers work the next month my bills want to access my credit card to get paid?
When replying to a post that wasn’t directed at you, it would serve you well to read the thread and be sure your response makes sense in context.
Saving less means costing more, even when save is in bold font. There is a cost associated with the physical card. That's the entirety of my point here. Nothing more profound than that.
As you say, some of this recovers the expense to Apple of producing, delivering, tracking, maintaining and likely outsourcing the processing of that physical card. The additional saving through Apple Pay likely comes in part because Apple's costs are lower that way, and because they see long term strategic value in encouraging more adoption of Apple Pay. The further additional savings for purchases through Apple are compensated by the fact that they don't have to pay the processing fee to someone else.
And, of course, none of this is actually a savings, and I find it troubling that people see it that way, but that's a separate discussion.
If I apply for a credit card, my score takes the hard inquiry, which might affect my score after a couple more inquiries. If I add my wife as a user she doesn't have a hard inquiry, unlike applying for an Apple card herself. We still both show a new account, which will hurt our score some as well.
We got new Chase card last September ($33,000 card which is paid off). Then our kid's 2011 Jeep died and we bought a car last December for her to take out of state to school (where the car dealer sworn they were a loan officer for our credit union and yet the CU pulled another report themselves). Credit Union then calls us 2 weeks later and says we have A+++ credit or something like that, and gives us a signature only HELOC the next day. So we have 3 or more hard inquiries in the last 6 months - the above dropped my Experian score from 850 to 810.
No more credit please. Just say no.
Sure you’ve got plenty, but don’t close the door behind you; others just got their first card a month ago! The Apple card might be their best shot at a cash-back card.
But yeah, 850 is the highest FICO score you can get; only 1% of users have that And I can definitely see how taking out both a HELOC and a car loan in such a short time would easily cost 40 points. There’s also a good chance you landed on a different scorecard. Meaning, (just as an example) before you were being relatively compared to those without a HELOC. But now you’re grouped in—and being compared to— those who do have a HELOC. So your score changes, and who knows maybe 810 or 820 is the top rung of that particular scorecard.
You’ve got (at least) three strikes: new accounts, new type of credit and lower average age of accounts. I’m 99% sure your inquiries had minimal effect. The good news is, there’s really no difference between 810 (still in the top 15%) and 850. Also, your score will likely recover over the next year or two, though if the drop is in fact scorecard related, you might not get back to 850 unless (and until) you get off your current scorecard.
P.S. A new account can help or hurt; someone with a relatively thin file, i.e. just a few accounts, may improve with a new account. For example getting a new revolving account with a decent credit line can easily increase someone’s score by 50 points, if it lowers their utilization (ratio between credit used and credit line) from say 35% to 9%.
PPS. An authorized user account is scored somewhat different from one coded as an individual, primary account holder. It didn’t used to be this way, but a lot of people were scamming the system (getting added as AU’s to increase their score but not actually being more likely to pay as agreed, i.e. not being a better credit risk). There’s also a scoring difference if the primary account holder has a different address from the authorized user. In that case, it helps the AU little to none.
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Some good points on the cause of strikes and such. I do worry about lowering the average age of accounts as well, so no more new accounts for another year or more. It will be a few years before we need to replace one of the cars and borrow, and when we buy another house in 4-5 years by selling our big house and downsizing for retirement it will be without a mortgage. So, I should be able to recover my score.
We didn't even need the HELOC, with a huge amount available on credit cards. But when offered one by the loan officer, who romanced us and convinced us that a 6% 5yr/15yr HELOC would be an asset, we bit and didn't even have to provide documentation, just our signatures. We figured that once we decide to downsize the house (after all the kids are completely on their own in 3-4 years and when we have enough equity to pay cash for the next home) then we'd use the HELOC to replace some old flooring and maybe a new hot water heater, order other repairs to improve the sale price. Then the sale proceeds would pay it off, with enough equity left over to pay cash for the next one.
We don't like being lied to. The car dealer's finance officer lied about being a loan officer for our credit union such that we would only get one credit check to buy the car. But then the credit union does a second credit check on the car loan. After that the CU tell us that HELOC would not harm our score as much as a new credit card, but it was worse. So, I'm inclined to just get out of a mortgage in the next 5 years, never carry a credit card balance, and say bugger off to the banks and pay cash for our next car every 5-10 years.
Good thoughts overall, seems like you’re in the right track. But you really don’t have to worry about your score; 720-760 will get you the best rates, you don’t need to be in the 800s. Nice to have a cushion though lol.
No late payments, no collection accounts or liens(!), using a max of maybe 5-10% of your credit line (paying every month), not cancelling older accounts, not adding new ones... that’s really all you need to do and they’ll take care of themselves. Monitor for fraudulent activity though, you can pull an annual free one and if you rotate through Experian/equifax/transunion you can get one every four months. Doesn’t impact score.
The HELOC is fine, lower rates for sure than credit cards but it’s not like you’ll be carrying a balance for long in any case. Having it on deck for eventual home repairs/improvements makes sense, and I’m guessing since it’s with a credit union that there are no (or very low) fees associated with keeping it open/unused.
Things you might want to think about: term life insurance, 10-year level premium. No whole life policies, ever. No annuities (as a general rule) but in the right situation they are appropriate but watch those fees. No commission-based or high-fee financial products, or percent of assets financial advisors; hourly fee-based only, if needed. Contributing to tax deferred retirement accounts like 401(k) and IRAs (if your wife is working) as much as you can. Moving out of equities; capital preservation becomes more important than higher returns. Asset protection; a $1 million or so umbrella liability policy (surprisingly cheap) in addition to your homeowners insurance. Decent limits (not minimums) on your auto insurance—$250,000-500,000 or even $1 million adds a relatively small additional premium.
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Thanks, I do think a thread about getting new credit cards should include talk about planning for the future, and talking about the perils of going into debt with the new credit card.
As for the last paragraph, we have addressed every issue you raised, and then some. We monitor our credit closely with all 3 bureaus. I was fortunate enough to have bought enough life and disability insurance before I got too sick to be insurable. I, however, should have insured myself for more than 50% of my income, although with the cost of living rider it's almost double what I was being paid in 1999 when I started collecting.
We have the $1M umbrella liability policy that covers home and auto, in addition to $500K limits on each, as you recommended. And no annuities or high cost financial products. My wife has an 80% pension after retiring from a public hospital job of 32 years, and a couple of 401K through her last job and current job (I met her at the hospital 27 years ago while I worked as a pediatrician). Plus we have my social security and private insurance from my disability.
19 years ago the doctors gave me 5 years to live, and 5 years ago they told me I could go any day now if I didn't have a potential life threatening surgery that would carry a 10% chance of mortality. I was like, "Ummm, no. God will see us through this, because a 1/10 chance of dying on the table sucks when I've already outlived the doctor's original predictions by a factor of three."
I have a disability waiver of premium paying for my whole life policies that I got in 1991, and even if that didn't pay out, the premiums are not outrageous since I got them so long ago and they can't raise the rates. I have a 30-year term policy which is about 25% of my total insurance coverage, with a waiver of premium until I'm 62. So in 5 years I may have to drop that one policy if the premiums become too high when it renews later at age 65. Even without that one, my whole life insurance is enough to pay off the mortgage now, and in 5 years when that waiver ends there should be no mortgage left, so I could let it drop.
This product is super refined, and Apple can effectively eliminate fraud claims with the exception of a few outrageous (or dubious) incidents if the iPhone is required to be in proximity in order for the card to garner an approval.
The Simple (simple.com) banking app has a Goals feature that is hands-down the best way to save, and my hope is that Apple will follow suit by concocting a series of well-thought banking products. There is such a profound amount of infrastructure surrounding physical branches and cash handling that are so unnecessary.
Private kiosks and vaults to speak to remote bankers over video would be much more effective, secure, and would provide for a superior experience. The line of thinking is that banks could share terminals and eliminate all the duplicity and wasted physical space. The world simply has too many competing banks with not a lot separating their offerings, and I think Apple could make this make a whole lot more sense.
Conclusion: the iPhone needs a holographic 3D printer to print cash and mint physical cryptocurrency coins with a gold reserve stored in the Secure Enclave.
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I have a feeling that if you have the credit worthiness to be approved by Goldman Sachs, melting down an Apple Card over the electric burner in your kitchen isn't at the top of your priority list.
The Simple (simple.com) banking app has a Goals feature that is hands-down the best way to save, and my hope is that Apple will follow suit by concocting a series of well-thought banking products. There is such a profound amount of infrastructure surrounding physical branches and cash handling that are so unnecessary.
Private kiosks and vaults to speak to remote bankers over video would be much more effective, secure, and would provide for a superior experience. The line of thinking is that banks could share terminals and eliminate all the duplicity and wasted physical space. The world simply has too many competing banks with not a lot separating their offerings, and I think Apple could make this make a whole lot more sense.
Conclusion: the iPhone needs a holographic 3D printer to print cash and mint physical cryptocurrency coins with a gold reserve stored in the Secure Enclave.
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How much is the amount of titanium worth? What if I lose a card every week? By what time will I be able to afford AirPods from the amount of „lost“ titanium?
So many questions.
I have a feeling that if you have the credit worthiness to be approved by Goldman Sachs, melting down an Apple Card over the electric burner in your kitchen isn't at the top of your priority list.
Costco Anywhere VISA card rewards are 4% on gas (up to $7k of purchases), 3% restaurant / travel, 2% Costco, 1% all else. It's a great card if you are going to have a Costco membership anyway.
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You just link any checking or savings account and do an ACH payment.
One earns 3% on two categories (1% more than one would earn with using Apple Pay with an Apple Card on those categories). One pays $150 for the card (after the statement credit for $300 in travel purchases). That means until one has spent $15,300, one is net down over the simple 2% daily cash (not even worrying about the difference in the time value of the money).
After $15,300 in spend in the 3x categories, one begins to do better using that card over the Apple Card in those categories.
You are a point/mile hacker, so you might not. Other people who travel primarily for work (and do not want to use miles to buy tickets that would be reimbursed), or simply do not care to spend energy and time trying to hack rewards, do not want to deal with the vagaries of airline redemption rules and devaluations, etc. would rather have cash.
No. Under certain circumstances, if one wishes to spend some amount of extra time and effort trying to manage the best redemption, and is willing to give up other benefits (like the option to upgrade, earn miles towards Million Mile Status, etc.) they might be worth more. Most people are not mile/point hackers and do not want to spend time worrying about that.
Again, you gave the example of being able to purchase a $2,000 ticket to Tokyo for 40,000 miles (not sure on whom you did that, as American, Delta and United all charge 35,000 miles for a saver award - AA is 32,500 for an off peak ticket, so I cannot compare directly to them).
That would be a good deal. On the other hand, I just checked again and one can purchase a ticket to Tokyo for $604 on United with no advance purchase, in a W fare that is upgradable, earns qualifying miles and miles towards Million Miler status. A business class ticket for $604 (with status miles as a bonus), seems like a better deal than a coach ticket for $400 (with no status miles).
I am a 3 Million Mile Flyer on United (granting me lifetime 1K), and working towards 4MM (to earn lifetime GS) as well as have million mile status on American (lifetime Gold - not much value). I was a life time Diamond Gold Passport member with Hyatt (now lifetime Globalist), and have status with Marriott and IHC (what level depends on year and travel patterns).
I have lived through many devaluations and rule changes on award tickets. I personally earn more than enough miles just from ticket purchases, and airline promotions, that an extra 150,000 miles (3 times the almost $50,000 you spend on travel) just is not that interesting. Any 1K, ExecPlat, or Diamond is earning at a minimum, 165,000 miles a year from ticket purchases (11x $15,000 qualifying spend to maintain status). If one does not have top tier status, the value of the miles is greatly reduced thanks to fees for close in ticketing, refunding a ticket back to miles, change fees, etc.
Many people (myself included) would rather have the cash and not have to worry about any of these issues.
Again, no. Under the best of circumstances, one might be to convert that $150 into more value hacking miles. Unfortunately, one never knows, nor does one know when the program rules will change that will make conversion less valuable, et cetera. One knows the value of cash, and one knows that spending $15,300 in travel, will get one to break even.
Again, I think what you meant to say is: that if one is a mile/point hacker, who enjoys spending time and energy trying to optimize redemption, wants to do a small amount of additional travel (your 150,000 extra miles earns 3 one ways between North America and Tokyo and one round trip under 700 miles), and spends enough on properly coded travel, the card might be interesting.
That seems like a very small group, compared to the total pool of credit card users.
This would be true for an even smaller group of people.
You are correct in that there are different rebates for the different modes of charging. What I think people meant when they said there is no cost for use of the physical card is that Apple does not charge people to have the physical card, nor are there specific fees for using it.
I think the Kroger example supports what I'm saying. Kroger stopped accepting Visa at some stores with a month of notice to their customers because they went to war with Visa Corp-- good on them for taking a stand, but I'm not talking about how much notice is given to customers, I'm talking about how long it takes to a business to change their practices. With Kroger, it's a slow going process. They publicly started the process almost a year ago, their internal debate surely started long before then, and it's only one company doing it at a small number of stores in a small number of states.
So in the Kroger case, my estimate that it takes longer than a year for business models to change is valid.
Thanks, for linking to sources. Makes this a much more interesting conversation. The only reason to argue with strangers is to hopefully learn something, and links to data help.
The paper you linked to was funded by the American Bankers Association to refute a paper from the Federal Reserve Bank of Boston.
To your point, that FRB paper is dated 8/2010, a year before the Durbin Amendment, so obviously rewards cards predated the law change. I'd specifically meant "cash reward" cards but, you're right, they predate the new law as well. Not sure where I read otherwise. As you suggest, I may have missed a distinction between existence and prevalence. Discover seems to have led the charge in this area, and the higher fees associated with it seem to be one of the reasons for its limited acceptance.
To my point, the FRB paper goes into quite some detail of one of the distorting effects of rewards cards: wealth transfer from lower income consumers to higher income consumers:
"on average, the lowest income household ($20, 000 or less annually) pays a transfer of $21 and the highest-income household ($150, 000 or more annually) receives a subsidy of $750 every year [written in 2010]"
The PERC paper you linked to above counters the Fed's analysis with what amounts to an opinion poll. People who get cash back like their cards more than people who don't. No surprise there. Given the conversation in this thread, it's clear people aren't thinking about what's actually happening behind the scenes-- they're just focused on the drip of rewards they see trickle back. A card with that trickle is preferred to one without.
Something like 37% of debit card transactions are exempt from the cap.
And cash is king on a transaction count basis.
I believe this card will become very popular if it looks like that physically because people love to show off their cards these days.
I have a bus platinum from Amex and constantly get strange looks, asked questions on what I do, but maybe it’s all because I’m pretty young to be carrying a card like that.
I wouldn’t mind getting one of these if there were some kind of big perks that could benefit me.
I have a bus platinum from Amex and constantly get strange looks, asked questions on what I do, but maybe it’s all because I’m pretty young to be carrying a card like that.
I wouldn’t mind getting one of these if there were some kind of big perks that could benefit me.
I'm sure that's what people mean-- you don't have to buy the card. It's a narrow view of "cost" is all. Saying there's not a specific fee is starting to skirt the language line again though.
If I were to summarize the headlines from Apple Card, they'd be:
- 2% cash back through Apple Pay
- Titanium in your wallet
Saying it's a cost, savings you don't get, a fee, or a "physical use charge" is all different language for the same end result. You can't say "you get less savings but it costs the same"-- that's self contradictory. Saying there isn't a "specific fee" when the additional cost is specifically for the physical card is borderline at best. If Apple said we're charging a 10% fee on all transactions and giving you 11% cash back-- would you be comfortable calling it 11% cash back? The cost is the amount of money that leaves your account. Using the Ti card costs more than using Apple Pay.
For some reason, nobody is framing the discussion as "Apple Card is 1% cash back, plus an extra 1% if you use Apple Pay." That would also be true, but just isn't as splashy I guess. Through the forums here, people seem to be taking that 2% number as the comparison point.
If you're an iPhone user that has Apple Pay support, I don't know why you wouldn't at least sign up and just have it if there are no fees associated with the card/Apple Pay. Sure it's another credit card that you have but there's really no downsides to just having it.
If and when Apple decides to make Apple Card available to Canada, I will definitely be signing for a secondary card, if for just the daily cash back rewards and to use for small purchases.
If and when Apple decides to make Apple Card available to Canada, I will definitely be signing for a secondary card, if for just the daily cash back rewards and to use for small purchases.
The only good thing i like (apart from the design), is the one-time virtual number...
How does one prove you own the card at a merchant if they don't support Apple Pay? If there is no signature to prove its you.
The interest rate is a tad high.... Mine CC is only 13.49%pa
The only think i wish banks still did the virtual one-time CC.
How does one prove you own the card at a merchant if they don't support Apple Pay? If there is no signature to prove its you.
The interest rate is a tad high.... Mine CC is only 13.49%pa
The only think i wish banks still did the virtual one-time CC.
You don’t. The issuing bank does not require a signature. The network does not require a signature. So no signature required. Like other banks, they will rely on knowing your spending patterns, travel plans, etc. to flag potentially fake spending.