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The Good and the Bad of Debit Cards

Jun 19, 2008
A debit card is sometimes offered by backs to account holders in place of a standard ATM card. It is still an ATM card however because it has a MasterCard or Visa logo it can also be used like a credit card, with a couple of exceptions. First a debit card takes the money direct from your bank account therefore it does not incur any fees. So is this good and should you be using a debit card?

A debit card is given to someone who opens a checking account at a bank and asks for a debit card. These cards are used like a credit card but do not come with the hassles of fees and penalties. Debit cards never have to be paid off and users never have to worry about late payments. These cards make it so much easier to purchase things in the store as well as online. Debit cards are quick and easy to use. With the swipe of a card a payment is made and that is that. Lose the paper and go plastic!

Debit cards are a great way to teach individuals the concept of managing money. If people have had issues with credit cards in the past, a debit card is a perfect way to teach someone to not spend as much money and to not go over the limit that is available. Some debit cards even come with a safety net because they are combined with the checking account and the card only has as much money that is in the account. Today many people have stopped using checks and dollar bills and have moved to debit cards.

Seeing as how a debit card works, are they completely good? No, they are not. Like everything in the world, debit cards do in fact have a pitfall; however, this pitfall can be avoided if the card is used carefully and wisely.

Because debit cards are joined with a person's checking account, all transactions are recorded in a computer program managed by the bank. The bad side of debit cards is the dreaded ATM machine. Though the machine is just a box that spews out money after a few numbers are entered, it has its pitfalls.

Unfortunately, just as fast as you get money or deposit money into your account, it can just as quickly go away. If you are careless with your debit card, you are sure to run into problems. A checking account can be overdrawn, even if you don't bounce a check. Another downfall is that the receipts the ATM machine provides are not always the most up-to-date.

Debit cards can also be blocked just like a credit card. Banks and many stores can block a set amount in the account until a certain transaction has processed. For example, if you pay $30 for gas using your debit card, and the store blocks $60 on the card and you bought something worth $30, you will run into many issues until the block is removed from your debit card.

If you want to learn to manage your money, then a debit card is a great choice for you. When using a debit card, learn how to be wise when using it or you could run into a lot of conflicts that can be avoided easily.
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