When you're evaluating the benefits of one credit card over another, you have a lot of different factors to consider, including fees, rewards, and interest rates. But does the type of credit card you choose matter at all? Is there any real difference between a Visa and a Discover card with the exact same terms?
There are four major credit card networks in the US: Visa, Mastercard, Discover, and American Express. These companies offer a network of infrastructure that allows merchants to swipe your card and then collect the money from your card issuer. They also set the fees that the merchant must pay to use the network – that's right, every time you swipe your card, the merchant must pay for the privilege of allowing you to do so.
The fees that your merchant pays, also known as interchange fees, are not static; Visa and Mastercard adjust their rates twice a year. Different types of businesses also pay different rates, and they may have different fees for different tiers of credit cards and debit cards. For instance, a Visa debit card transaction at a grocery store may have a smaller interchange fee associated with it than a restaurant even if the transactions themselves cost the same amount.
Online shopping is usually more expensive for the retailer because swiping a card is typically cheaper than typing in your card number on a website.
Of the four major credit card networks in the US, Visa usually has the lowest processing fees. American Express often has higher fees.
|Network||Average Credit Card Processing Fee|
|Mastercard||1.55% - 2.6%|
|Visa||1.43% - 2.4%|
|Discover||1.56% - 2.3%|
|American Express||2.5% - 3.5%|
These are on top of any additional fees that the credit card networks may charge such as charge-back fees, terminal rental fees, and IRS reporting fees. These fees are paid by the merchants, but they also affect you as a consumer. American Express almost always has higher fees than Visa, Mastercard and Discover, which is why you're more likely to encounter a merchant that won't accept it. If you're in the market for a new credit card, you may want to make sure you have a Visa or Mastercard as a backup instead of only having Discover or American Express, as Visa and Mastercard were accepted at 10.7 million locations in the US at the end of 2019, compared to 10.6 million for Discover or AMEX. Costco is one merchant that only accepts Visa, and those without a Visa card may be out of luck.
Issuers vs. Networks
Pull out the credit card in your wallet and take a look at it. Chances are, if it's a Visa or Mastercard, you'll see their logo as well as the logo of the bank that issued it. That's because Visa and Mastercard are card networks, but do not actually issue the cards themselves. They merely facilitate payments between the merchant and the bank that issued the card.
On the other hand, Discover and American Express both process transactions and issue cards. As with the fees, this may not have a big impact on you as the cardholder. However, it does mean that you can't take advantage of having a card linked to your bank. if you are interested in building a deeper relationship with your bank to get better interest rates or have everything consolidated into one app, Discover and American Express may not be the strongest options.
When picking your next credit card, consider the array of cards that you already have, and ask yourself if you are interested in diversifying the different networks that you may be able to use if one retailer does not accept a certain type of card. However, as most of the practical differences are behind the scenes and don't affect you, your considerations should be given to the different types of rewards you can get through the card and the fees you will pay before you worry about which card network you might want to use.
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Airbnb offers an affordable option for people looking to be more comfortable as they travel.
However, there are downsides to staying in a host's home rather than a hotel. Whereas hotels are designed for constant streams of visitors and often have furniture built to last, at an Airbnb, you may be staying on old or cheap furniture that a host is using in order to maximize their profits.
And while most reputable hotels will have regular room inspections from staff to check for any wear and tear, Airbnb damage disputes are oftentimes he said, she said situations. If you are in an Airbnb and something breaks, there are a few steps you should take in order to ensure that you are not on the hook for damages out of your control.
If you're keeping tabs on the art and tech worlds, you've probably been hearing whispers about "NFTs" for the past month. Just over the past week they've entered the mainstream lexicon.
Twitter founder Jack Dorsey made the news for selling his first ever tweet. The app has been teasing paid subscription models and newsletter-like features, but tweets for sale is "the next frontier."
just setting up my twttr— jack (@jack)1142974214.0
The 2006 tweet went up for auction as an NFT, and the current bid is $2.5 Million. But what does it mean to own that? Why would anyone want to? And what even is an NFT?
Long gone are the days when the majority of Americans dreamed about owning a home with a white picket fence.
The traditional American Dream may be on its deathbed, but that doesn't mean a core component of the vision can't survive. It simply takes a diverse perspective. People can still believe they can attain their own vision of success in society with hard work, knowledge, and risk-taking. Investing in today's American Dream may literally mean investing money in our modern economy, starting with our infrastructure.
Real estate investing in particular is a lucrative method that can boost income and secure a better financial future for many. There's always risk involved, but the payoffs can far outweigh the uncertainty. Selecting solid financial investments is about confidence and competence. If you're looking for some advice on this kind of investment, here are a few savvy tips for new real estate investors.
Stick To a Specific Strategy or Niche
Real estate is a challenging sphere of the business world, one that requires several key skills: groundwork knowledge, networking, perseverance, and organization. True knowledge of the real estate market will come with time and experience, but it's a smart idea to select one area of the market and stick to it. This is the best way to attain in-depth familiarity with your specific niche.
First, choose a geographical area close by and then a niche strategy within it, such as house flips, rental rehabs, or residential or commercial properties. By doing so, you can become aware of current inner working conditions in the market and you'll have a better idea of how these trends may change in the future.
Be Vigilant About Viable Financing Options
While it takes money to make money, you don't have to use all your own money. A common misconception about real estate investing is that you must be wealthy to start off. This isn't straight fact, however. A majority of people can test the waters of real estate investing without a lot of initial cash in their pocket.
Aside from traditional financing options from banks and institutions, private lending options can be worthy solutions. Hard money lenders are popular, reasonable choices, and they tend to have fewer qualification requirements upfront. However, be sure to strategically choose a hard money lender to find the best possible fit.
Master the Art of Finding Good Deals
There may be hundreds of thousands of available properties for sale on the current market, but the bulk of them will never amount to the final money-making result you desire. Another great tip for new real estate investors is to use good math to estimate profit. Taking risks is part of the process, but you have the ability to analyze properties and use networking sources to find the greatest deal. You can't win every deal, but you can steadily work towards a thriving financial future.