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The YNAB Podcast

Gaming the Credit Card System... Maybe

Mar 25, 2024
05:16
Snipd AI
Exploring leveraging credit card float for financial gain and the influence of credit card rewards on spending behavior. Financial institutions have incentives to encourage spending, and using credit cards may lead to impulse spending. Jesse shares his experience with ditching credit cards and how it has made him less likely to impulse spend.
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Podcast summary created with Snipd AI

Quick takeaways

  • Strategically maintaining extra funds in checking accounts to leverage credit cards for extended payment timelines is a form of 'gaming the system' in cash flow management.
  • Credit card companies employ rewards programs to incentivize higher spending, subtly encouraging customers to spend more for increased profits.

Deep dives

Credit Card Float Game

Some individuals strategically keep extra funds in their checking accounts to utilize credit cards, allowing them to extend their payment timelines, essentially leveraging the bank's money for an additional 30 to 45 days before settling the balance. By maintaining a surplus in their checking accounts, they engage in a form of 'gaming the system,' which grants them an advantage in managing their cash flow.

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