topic Re: TD Clear Cards. Subscription based? in Credit Cards

TD Clear Cards. Subscription based?

daveg38 — Tue, 15 Aug 2023 23:34:45 GMT

Just stumbled upon the TD Clear Cards.

No Interest. No fees. $10 a month for $1000 CL; $20 for $2000. Claims to be subscription based.

TD Clear Credit Cards: No Interest – Just A Simple Monthly Fee| TD

What are some DPs? Thoughts? Sounds like 690+ score is needed.

Re: TD Clear Cards. Subscription based?

Anonymous — Wed, 16 Aug 2023 00:13:53 GMT

At first glance, a secured card seems a better idea (if that is an alternative). Even if you had to park the full $1000 to get a $1000 CL for a secured card, each year that's less than $60 in lost interest at current rates. This card would cost $120 per year. Though I guess if you don't have the $1000, this might be a viable alternative.

Re: TD Clear Cards. Subscription based?

Life_take2 — Wed, 16 Aug 2023 01:19:55 GMT

It is a clever offering on TD's part, but I am not sure it is worth it. Based on the structure of the card, the lower the balance, the higher your "cost of credit." To me, the cost of credit is anything you pay that doesn't go to the principal - whether it's called interest, fees, or membership dues. Based on that logic, look at how it breaks out:
If you used all $1000 and it cost 10/mo in cost, that would equate to a 12% interest. But if you only carry a $500 balance, that same 10/mo cost now equates to 24%, and at $250, that $10/mo becomes an eye-popping 48%. and if you don't carry a balance or PIF, these cards hold nothing for you.

Just my .02

Re: TD Clear Cards. Subscription based?

Anonymous — Wed, 16 Aug 2023 04:56:09 GMT

@Life_take2 wrote:
It is a clever offering on TD's part, but I am not sure it is worth it. Based on the structure of the card, the lower the balance, the higher your "cost of credit." To me, the cost of credit is anything you pay that doesn't go to the principal - whether it's called interest, fees, or membership dues. Based on that logic, look at how it breaks out:
If you used all $1000 and it cost 10/mo in cost, that would equate to a 12% interest. But if you only carry a $500 balance, that same 10/mo cost now equates to 24%, and at $250, that $10/mo becomes an eye-popping 48%. and if you don't carry a balance or PIF, these cards hold nothing for you.
Just my .02

Right, and from that viewpoint, they may well encourage "maxed-out" spend as after all, you have already paid for it!