I’ve ran a lot of surveys on the internet regarding whether you guys use debit cards, Credit Cards or even cash for your most common purchases and what the results are showing is that you guys typically use your debit cards for purchases and that’s why I’m making writing this article for you.
So in this article, I’m gonna explain why I never use debit cards to make purchases unless I absolutely have to and why I typically use credit cards for all of my purchases?
Just because it makes moresense but don’t worry if you do use debit cards because I’m not gonna totally diss on them because there are actually pros and cons when it comes to credit cards and debit cards.
But for the most part it just makes more sense to use a credit card if you’re not paying any credit card interest.
Benefits of using Debit Card
I’ll start off talking about the good things about debit cards and then I’ll move into thenegative stuff so that you can see with a little more clarity why I prefer to use credit cards for all of my purchases.
now one of the best reasons for using a debit card is because it’s linked directly to your checking account so what this means is that every single time you make a transaction with your debit card it’s gonna show up instantly on your statement balance so that you know exactly what’s going on inside your checking account right when you actually make a purchase.
another cool thing about debit cards is if you ever need cash back then I would definitely use a debit card because you can do this at grocery stores gas stations all over the place and you can always get cashback and it’s super easy to just take it out get cash right from your checking account.
now on the flip side credit card transactions do post on their accountthe same day but they’re never going to be fully posted for about three dayswhile they pend and so sometimes that can get a little bit confusing and thenif you ever do need cash back from a credit card I would never do thatbecause it’s called a cash advance and you’re actually going to be charged interest every single day you use it which is something that I would not recommend doing and then keep in mind whenever you’re using a debit card thetransactions are actually being deducted from your account which makes a lot moresense from a budgeting point of view.
Because when you’re using a credit card the transactions actually go up on your balance and it can confuse people a lot because you’re not seeing it a direct reflected sense like you do from your debit card in your checking account and seriously if you do carry a credit card balance where you’re paying interest every month then disregard everything I’m about to say because in that context I still want you to use your debit card for everything because it is not worth taking any of this advice if you’re paying interest on your credit card.
Now the way that you can tell if you’re paying interest on your credit card is just check your statement balance and see if you have any line items that say that you’ve paid any interest charges because if you have then that means you are paying interest on it.
Now the other way you can tell is if you just know for yourself that youdon’t pay off your statement balance in full.
The point I’m trying to make is that if you are paying any interest on your credit card then disregard what I’m about to say.
Now these are the reasons why I prefer to use credit cards for all of my purchases versus debit cards.
Benefits of using Credit Card
This is why it’s going to make sense for you guys now the first reason why I use credit cards for all of my purchases isbecause they are way more protected than debit card purchases so if you ever need to reverse a charge it’s a lot easier to do that with a credit card than with a debit card so for example a few years back I was staying in Singapore at a hotel and the problem is is that the hotel actually charged me for two rooms when I only needed one room
So when I actually disputed the charges with them they refused to settle it with me so all I did was I just called up Visa who is the credit card that I used at the hotel and then they helped me get the charges reversed so that I didn’t have to pay for a room that I didn’t book.
Now I’m not saying that debit cards won’t help you in those types of situations but the thing is is that with a credit card it’s always in their best interest to keep you as their customer and they’re always gonna do as much as they possibly can to help you.
Whereas with a debit card you just don’t have as much protection credit cards also give you.
Extended warranties on your purchases and they also protect your purchases against theft and damage which is something that debit cards never do.
they also have all the reward points and signup bonuses too so if you’re going to be spending money anyway then you might as well just get the reward points that you do with a credit card.
Now I have seen a lot of debit cards that actually do have rewards programs but you have to look for them and do a little bit of research to find them but they do exist out there it’s just a easier to find them with credit cards
Because it seems like every single credit card out there has a rewards program because at the end of the day if you’re gonna have to pay your utility bill regardless then you might as well just get reward points for using your credit card.
Because you’re gonna have to pay it anyways and then if you travel internationally credit cards are actually very useful to use because a lot of them aren’t gonna charge you foreign transaction fees and what this means is that if you’re buying stuff outside of the country then they’re not gonna charge you to convert the currency whenever you make a transaction that is very convenient .
Another thing to keep in mind with credit cards is that their websites are extremely robust so if you’re in a budgeting and stuff like that then credit cards are very very good because they obviously have a lot of money to fund their websites and they make them extremely intuitive to figureout your budget and where your spending is.
And all that kind of stuff where as with a lot of debit cards if you’re using a local bank or a small little credit union you’re never gonna have that type of a website and they’re never gonna be as good as what you get from credit cards.
And then the last thing on credit cards is that they actually carry an important role in your credit score which is something that debit cards definitely don’t do but I wish it wasn’t true but it is and it’s just the fact that you do need a credit card in order to help your credit score out in some sense because basically your credit cards control about 30 percent of your credit score through what’s called credit utilization and this all just has to do with how much you’re spending versus what your limits are.
The point is is that credit cards do help your credit score and debit cards don’t and just remember that credit cards don’t charge you a penny and interest unless you’re not paying your statement balance off in full.
So as long as you’re paying off that statement balance you’re never gonna have to pay apenny in interest and you don’t have to be afraid of credit cards.
But if you feel like you’re the type of person that’s not going to be able to control your spending through a credit card then definitely just stick with what works I just want what’s best for you guys.
And in my context I like to use credit cards because they’re better than debit cards in some ways but if you’re not going to be able to control your spending and you’re gonna be spending money on interest then definitely just stick with a debit card.