Debit cards are preferred over credit cards for a number of reasons. However, one of the most important reasons is that in case of a credit card, there is a high possibility that you end up with credit card debt. This is not possible in case of a debit card. What happens is that when you make use of a credit card, it means that you are first swiping your card when you make purchases and then at the end of the month, you pay the bank. In case you fail to pay the bank, it results in credit card debt. On the contrary, in case of a debit card, you first deposit money in your bank account and then as and when you use your debit card for purchases, this amount keeps getting deducted from the main balance. Now, you must read ahead to know about a few things that are important before you start using your debit card.
- Never write your pin: You should never write down your pin. This pin is a number that you get of four digits. It is used when you need to withdraw money from the ATM and also swipe your debit card. This is why you should never let anyone else know about it or they can use your card and there will not be anything that you can do about it. The procedure to report fraud is lengthy and time consuming.
- Avoid online shopping if possible: Next, you must avoid shopping online through the use of your debit card. This is because your privacy is at risk. The mechanism with which these cards work is that they give all your details to the merchant. This is where your privacy is at stake and I am sure you would not wish to take any such chances.
- You pay a fee or it: Do not think that you are getting your debit card services and ATM services for free. There is an annual fee that is deducted from your main balance. Though it is the duty of every bank to inform the account holder about it in advance, it is often missed out since it is believed that everyone has prior knowledge about it. Always confirm this sum with your bank so that you are not overcharged.
It is way better than using credit cards: Debit cards are surely better than credit cards. This is because you spend only what you already have. When your account balance is low, you will be notified about it and this is how you will be able to keep a track of your expenses and stay within budget. This does not mean that you can over swipe. Well, definitely you can and you also then risk losing your account. however, it is way better than credit cards because in case of credit cards, you are bound to lose track of the expenditure.