Sometimes Credit Cards are the Best Way to Pay… and sometimes it’s smarter to Debit
Credit and Debit cards both have benefits and drawbacks. So, how do you decide when to swipe each type of card?
The way you handle your money is a matter of personal preference. If you like using cash, credit or debit for everything, that’s great! Stick with what works for you. But, if you’re wondering which type of plastic makes the most sense in different situations, check out these tips to find out when and where to choose credit versus debit.
Online Shopping - CREDIT
In 2014, nearly $800 million was reported lost to internet fraud - with an average loss of over $6,000 per victim!
Most credit card issuers don’t hold you responsible for lost funds if your information is stolen, but your debit card is linked to you bank account - which gives thieves direct access to your money, now.
Everyday Purchases - DEBIT
According to a study, people spend 47% more at McDonald’s when they use a credit card.
It may be easier to control your spending if you use a debit, and the money comes directly out of your bank account.
Electronics - CREDIT
Some credit cards provide extended warranties, additional property insurance, and conflict dispute rights.
Just be sure to pay your entire balance each month so that new television, smartphone or laptop doesn’t wind up costing you twice as much with interest charges.
Restaurants and Nightlife - CREDIT
In 2009, 13% of all credit card hacking crimes involved the restaurant and bar industry.
Any time your card leaves your hands, it’s an opportunity for theft. Credit tends to protect.
Need Cash-Back? - DEBIT
Many retailers allow you to get cash back without paying ATM fees when you use your debit at checkout. This is a handy way to get your hands on some cash for a valet, when you don’t have an ATM nearby.
Memberships - CREDIT
If recurring charges accidentally continue after you cancel your membership, your credit care issuer can deny payments on your behalf.
Tell your issuer as soon as you realize you’ve been charged for services you aren’t receiving.
Souvenirs - DEBIT
For best exchange rates when traveling abroad, hit the ATM and use cash for smaller purchases.
Just check with your bank beforehand to find out if they charge fees for foreign transactions or have a relationship with a foreign banking institution before take-off.
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