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Debit Cards Are Better If You Want to Give Away All Your Money

Dec 21, 2000 Write an essay on this topic.

Sorry for the sarcasm, but I just don't understand why everyone doesn't understand dangers of debit cards. If you lose yours (or your wallet or purse is snatched or stolen), the person who has the card has access to all the money in your checking account. Now, I realize banks and credit unions have various limits as to your liability, but even if they hold you liable only for $50 (are there any that do that?), what happens to your checking account and the checks that bounce while they are refunding your money? I've heard too many horror stories of banks that took weeks to straighten out accounts and some even tried to charge fees for bounced checks.

Credit cards, on the other hand, can be abused if you charge to your credit limit, regardless of your ability to repay. The responsible way to handle a credit card (and you only should carry one) is to know how much you will have to pay the bill when it comes, keep track of what you charge, either by writing it down in a register like for checks, or by calling the 1-800 number on the back of your card for the balance frequently.

Still, if you lose your credit card and report it promptly, you will only be charged for $50 in charges from that date and time. (You will be issued a new card and number so you can make valid charges).

I use one credit card, which gives frequent flyer miles for dollars charged, for everything except fast food purchases. I like having a record of my spending when the bill comes and I check balances frequently. I admit, though, that I have a target amount that I try not to go over, but there's another amount I know I can pay if it gets that high. Sometimes, it goes over the second amount and I pay it off with "checks" from another account that charges low interest for transfers. This is not something I recommend to you, just where I am right now. I work really hard to keep both accounts in limits that I know I can pay off within the year.

In conclusion, I think it's a no-brainer that credit cards are safer than debit cards. However, I must admit there are many otherwise intelligent people walking around with debit cards, many of them with a pin number, which is often not asked for. So, maybe I'm wrong. You have to make your own decision.

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