Differences Between Credit Cards and Debit Cards
If you are like some thirty somethings you could tend to use your cash card more than your credit card. So many people are using to cash cards, thinking it’s a “safer” option. But that isn’t always true.
Check out these differences between credit cards and cash cards and choose for yourself which is a wiser choice for you:
Extra Protections
Credit cards offer a lot of added protections that ATM cards do not. Call your express card for policies, but the benefits may include auto rental insurance, bag loss protection, extended guaranties, return protection, price protection, early ticket access, and more.
Credit Report
A credit card will help you establish a credit score, vital for purchasing a house, vehicle, even (in some cases) getting a job. A debit card won’t help you here.
Rewards
My experience has been that cards offer way better rewards than debit cards. Specifically, cashback credit cards offer really good rewards.
Fraud
Regardless of what I write, you cannot completely appreciate the advantages of a credit card over an ATM card when it comes to fraud. You check with your bank on your card’s particular policies, but in 99.9% of cases you’ll have better fraud protection with a credit card then a cash card. Why?
Well, the biggest reason is that with a credit card you will not be responsible for the fake charge while the issue gets sorted. With a debit card “it’s a entire other story. Imagine your wallet gets stolen and the thief goes on an $1000 shopping orgy at The North Face in Chicago. (It happened to me.) With a debit card this cash is instantly taken from your account, you’ll suffer overdraft charges, and you may not have access to the money again until your bank decides that this was in truth crime “if you get the cash back at all. Under Fed. Laws you could be liable to up to $500 of the fake purchases if you don’t report the fake charges within 2 day period.
Card Obstructing
Often hostels or rental automobile firms will hold a certain amount of cash on your card in case you buy something from the mini bar or wreck the automobile. (One time I hired a ship where they temporarily held $2500 on my card.) If you use your credit card you may never see this charge. Attempt to utilize a debit card and it will pull that money right from your account “probably causing an overdraft arrangement.