The Debit Card Debate
Debit cards are becoming more and more popular. Today more than 60 million people carry debit cards. Many of them now carry the same instantly recognized logos of the two major payment card companies. That number continues to grow daily. Today’s debit cards are not the same as standard ATM cards. You may not even realize all that today’s debit card can do for you.
It’s important for you to realize that not all debit cards are the same. Those debit cards that carry one of the two major payment card company logos are far more than ATM cards. These debit cards can be used not only to obtain cash from an ATM machine, but to make purchases anywhere those major cards are accepted.
More and more debit cards can combine the advantages of ATM cards, credit cards and checks into one easy to carry card. With these cards you can have instant access to cash, worldwide acceptance, and funds that come directly from your checking account instead of going onto an accumulating monthly balance that you may or may not be able to pay off. You may even have other advantages, such as being able to use your debit card with a Personal Identification Number at the supermarket checkout to get cash back.
Just as with a credit card, your purchases and ATM withdrawals are listed on your monthly statement. This helps you to keep track of your spending. If your debit card is stolen or missing, you need to notify your card issuer immediately the same way you would with a credit card. The same risks of theft or fraud are there with a debit card, despite the added PIN number.
Of course, there are always two sides to any debate. The two major credit card companies limit your liability to a maximum of $50 and it could be as low as zero if you report your card missing immediately. If you choose debit card, it is even more important that you notify the issuer as soon as you discover it missing, as you could find yourself liable for far more than the standard credit card limit. You may even find yourself stuck with the entire loss. In addition, some debit card issuers charge a fee for making any purchase with your debit card. It is also possible that even though your card is tied to your actual account, you may still find yourself drawing on credit if you tie your checking account to an overdraft line of credit. If you do this, be careful to keep track of your debit card spending so that you don’t run up interest charges.
Whether you choose a debit or credit card, you need to be certain that you read the fine print and shop around for the best deal. You also need to take responsibility for taking care of your cards and keeping track of where they are and how you use them. You should keep copies of all card numbers and the best way to contact the in a safe place outside of your wallet, just in case. Then, if your debit or credit cards are ever lost or stolen, you will have everything you need to report and replace them.