Five Debit Card Don’ts

source

Between the dangers of carrying cash on the streets and the ridiculous amount of fees that credit cards tend to charge, people end up using debit cards instead. What folks should realize though is that a debit card isn’t an innocuous little thing sent down by the heavens to rescue us from our financial abyss. It’s a business, y’all, as we once wrote here regarding debit cards’ hidden fees.

We’ve shared below ShopSmart’s must-know list of five situations when you should not use your debit cards.

ShopSmart’s Five Debit Card Don’ts to Help You Avoid Trouble

  1. Don’t use your debit card for major purchases and online shopping. Debit cards don’t have the credit cards’ power to extend manufacturer warranties up to one year. You might also lose the leverage offered by credit cards in terms of disputing charges with your bank (for instance, when it comes to damaged or defective goods)
  2. Don’t take your debit card when you travel. Opt for credit cards, which usually come with some type of travel and auto-rental insurance, plus concierge services.
  3. Don’t use a debit card if you’re worried about fraud. It’s worth noting that your liability charges with debit cards are greater than credit cards. Case in point: with a credit card, you’re only responsible for up to $50 in unauthorized purchases. Compare that to a debit card’s huge $500 liability unless you report the theft or loss of your card/PIN within two business days upon discovering the concern.
  4. Don’t rely on a debit card to improve your credit score. Turn to well-managed credit cards to help build your credit history and boost scores.
  5. Don’t use your debit card if you intend to earn rewards on purchases. After a federal law lowered the amount that banks can make on debit card transactions, they scaled back their rewards to such extent that you’re better off using a good cash-back or rewards credit card instead.