Credit Cards vs. Debit Cards

454Cash is being used less and less in today’s society. You can use your “plastic” almost anywhere now days. Just look around even street vendors take cards! But, when it comes time to use that plastic do we really know what we are doing. Credit or debit? All laid out for you are the advantages and disadvantages to each of these popular methods of payment.

 

Credit Cards: Advantages

  • Earn rewards for your purchases
  • Build credit
  • Warranties not offered in stores for purchases
  • Legal protection

Credit Card: Disadvantages

  • Monthly fees
  • Work with a signature

Credit cards extend you a line of credit to purchase items. Some people have shied away from credit cards because of all the fees that can be associated with them as well as the growing rate of credit card theft but there are still a lot of good features to Credit cards. Rewards are one of the biggest draw to Credit cards, getting money/fee stuff just by using this card? Yes! One of the more uncommonly known is about credit theft protection. If you report a stolen or lost credit card, the company will dispute the charges and you are not liable for those charges.

 

Debit Card: Advantages

  • No Fees
  • Only allow purchase with a PIN number
  • Controlled spending

Debit Card: Disadvantages

  • No legal recourse

 

Debit cards are becoming more and more common for people to carry. They allow people to use the money that they have in their accounts almost anywhere. Many people prefer using a debit card because it feels more like real money than credit cards. There are usually no fees and it is a way of controlling your spending by only allowing you to use the money that is in the account. One thing that many people do not know about debit cards is that if it is lost or stolen and that person makes purchases with that card, you are liable for those purchases. Although some banks may help you, they are not obligated to return that stolen money to your account.

Although, they are both great ways to make purchase, hopefully this will make you think of which card you should use before you get to the register!

November 3rd, 2014 by Quincy Insurance Agency LLC