Benefits of Using Debit Cards

A Debit Card looks like a credit card, but charges on the card draw money from your bank account (usually a checking account) vs. being billed at the end of the month.  You enter your debit card expenses in the checking account register book, just as if you were paying by check. 

You can use a Debit Card for just about the same transactions as a credit card in your own community or most of the US, plus you can use a Debit Card for ATM cash withdrawals.  Many international locations do not accept debit cards as payment, due to international banking laws.

PIN Code:  When you use a Debit Card for a purchase, the swiping machine will ask for your PIN Code.  This is usually a 4 digit code assigned to you by the bank when you get the debit card.  It is very important that you never give you PIN code to anyone else, and use care that nobody is observing your PIN entry during a transaction. 

Fees Associated with Debit Cards:   Your bank may charge you a small monthly fee for using your debit card for retail transactions or on-line transactions.  Try to set up a checking account with free use of debit cards for retail transactions or withdrawals from your own bank's ATM machine.  This is generally an amenity for checking accounts with a certain level balance.  If you don't qualify, then find out the fee schedule for Debit Card transactions.  Use of  ATM machines away from your bank usually post their usage charge which is a maximum flat fee of about $1.50 per withdrawal. 

Benefits of a Debit Card: 

• It tends to keep impulsive spending under control since you see immediately how the charge impacts the balance in your checking account. No nasty surprises from a high credit card bill at the end of the month because you lost track of your charges.
• If you use a credit card at an ATM, finance charges will be levied on your bill for cash withdrawals.  If you use your bank's ATM, you will probably pay no fee at all.

If you have trouble controlling your spending, using a Debit Card can be a very good alternative to a credit card for most of your local expenses.  Make sure you remember to always enter the expense in your checking account register because that's your charges will be deducted almost immediately after the transaction, especially if your have a low balance and want to avoid overdrafts with penalty charges. 

You should also have a credit card if you travel a lot on business, if you are planning an international trip, or for other rare occasion when a Debit Card is not an acceptable form of payment.