Why You Should Choose to Use a Debit Card


You may think that it matters little whether you pick your debit card or credit card out of your purse or wallet when going on a shopping spree. But it pays to think twice before flashing the plastic. After all, even though both the debit and the credit card have the same beginnings – you’ll walk away happy with a new purchase – they differ more than you might first think. Here I’m going to explain why it’s sometimes best to use a debit card instead of its credit card cousin.

[Read: Credit and Debit Cards: What’s In Your Wallet?]

It’s quicker and more convenient.

When you use your debit card the money is transferred almost immediately to the payee, meaning less delays than with a credit card and its “floating periods” (usually up to 24 hours after the transaction’s been made). Using a debit card also allows you to draw cash from an ATM as well as giving you access to popular payment services such as PayPal and Venmo. Not only that – if you need another alternative for payment such as a money order, most financial institutions and merchants will accept debit but not credit cards. The debit card really is your flexible friend!

It can help you save money.

When you choose to use a debit card you’re not only able to keep an eye on your account as it is in real time. You can also boost your savings with some nifty tips and tricks, depending on your bank. It’s important to remember that when you make purchases on your credit card you’ll be paying back the original amount plus interest, unless you pay it back straight away (which can be such as hassle!) If you’re not good at financial planning it’s tough to keep track of how much you’ll actually owe at the end of each month. Plus, it’s a lot easier not to spend the money if it isn’t in your account!

Not only does using a debit card mean that you won’t be racking up your credit card debt; you can also save money in the form of fees and taxes. For example, one of Wells Fargo’s checking accounts will waive its monthly $10 fee if you make a certain number of debit card transactions. And although we all have to pay our taxes, there’s no need to pay extra just for the administration of government bodies. The IRS, state and local governments will charge you a fee to use your credit card to make a payment (usually two per cent of the total payment). Pick up your debit card instead – you’ll only be charged a flat fee of about $2 to $4 – instant savings! You may also find that other institutions reduced their fees if you use a debit card instead of a credit card. Ask your utility providers if they charge additional fees for use of a credit card.

You’ll be reaping the benefits in no time.

Not only can you save money when you use a debit card, but you may also be party to some exclusive rewards. As many retailers have to pay a fee to accept a credit card payment they are often more than willing to offer a reward for those who choose to use their debit card. You may find that your bank or credit union also offers a reward scheme in the form of a points-collection program. Try one of the most popular banks to see what they can offer you, such as:

  • JP Morgan Chase
  • Bank of America
  • Citigroup
  • Wells Fargo
  • US Bancorp

Each bank will offer something different – some schemes that suit you and some that don’t, so make sure you have a close look at the pros and cons of each one. Don’t forget to check out the interest rates too – you may think that they won’t differ much from bank to bank, but as many accounts give you an annual percentage yield based on the money you’ve saved it’s always best to see what options are open to you.


You can also get excellent deals on foreign exchange rates, especially if you use your debit card to withdraw cash abroad. A credit card may seem like a safer option, however, so make sure you’re aware of your insurance plans and coverage before you travel. Also check whether or not you’ll be charged a fee, which is the case with some ATMs used for international transactions.

[Read: Why Debit Cards Are Replacing Credit Cards]

So, next time you see that glittering item that you just have to have, just take a step back and decide not only whether you can afford it or not, but how you’re going to pay for it. If you need help with handling your finances not only is a debit card’s transactions easier to keep track of, if you’re a savvy shopper you may just pick up some added bonuses. It really does make a bigger difference than you might first think.