As you compare your debit card and credit card, you have a big decision to make. Which one will you turn to when it’s time to make a purchase?
While your credit card may seem like the better option, thanks to the ability to earn rewards and build credit, there are times when it’s better to swipe your debit card.
1. You are swimming in credit card debt. If you are already bogged down with credit card debt, it would be in your best interest to avoid adding to it.
Think about it this way: a debit card is no different than spending cash. You can only spend what you have.
2. No fear of spending more than you can afford. Let’s face it: one of the biggest issues with a credit card is spending more than you can afford. When the bill finally arrives, you may regret your decision to make a purchase (or multiple purchases).
A debit card does not guarantee that you will make wise buying decisions, but it definitely helps the cause.
3. To take advantage of bank perks. Many banks are now attaching rewards to their debit cards. Similar to a credit card, you earn points for each dollar you spend. If you are interested in this, speak with your bank about any programs they may have in place.
There are times when a credit card makes good sense. There are also times when you should opt for a debit card. Knowing when to pull out each piece of plastic is important to your financial well being.