It seems everyone uses their debit card for every purchase these days. They cite the ease with which they make transactions. There is no need to carry cash and the worries that accompany holding a bunch of cash are erased. It really seems like this phenomena has occurred in just the past two years. Pretty much every store you go to will accept debit card regardless of your purchase size. However, it’s not all great news when it comes to using your debit card. Here are five disadvantages to this fad:
- Record keeping is mandatory. When you’re using a debit card you have to note each transaction so you’re not in danger of over drafting from your account. You need to know what your balance is at all times. If you over draw from your account you’re going to accumulate banking fees which can sometimes be as much as $100 for each transaction you conduct after you’ve gone in the negative. You also run the risk of severe embarrassment if you’re rejected from a store with a long line of customers behind you.
- Convenience is not always guaranteed. If you happen to be at a place that doesn’t take a debit card, then you’re up the creek. Your kid wants to grab a treat from the ice cream man? You can’t give them your debit card. It only seems like every store or restaurant takes a debit card. You’re bound to come across a place that won’t take your card at least once or twice a month.
- Hidden fees are everywhere. If you’re not using an ATM affiliated with your bank then you’re going to have to pay a fee. On top of that, many banks then charge a foreign ATM fee. These fees can get as high as ten dollars a pop. Always read the fine print before you take cash out with your ATM debit card.
- Internet scams are commonplace. If you use your debit card to purchase goods online then you have to be careful. Your information can get lost in cyberspace and fall into the wrong hands.
- Is your card lost or stolen? This is the worst feeling in the world. You want to believe that nobody would ever do anything wrong with your information, but your card can fall into the wrong person’s hands. If you make a delivery order with someone over the telephone, they now have your card number, expiration date and security code.
If you’re going to use a debit card, be sure you’re using the right one. I recommend the PerkStreet Financial MasterCard Debit Card. It provides up to 2% cash back on debit card purchases with no caps (one of the best debit card rewards programs in America), free online banking and bill pay, no annual fee and no monthly fees when you use your account.
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Heather Johnson is a regular commentator on the subject of credit card types. She welcomes your feedback and potential job inquiries at heatherjohnson2323 at gmail dot com
I’m assuming you are talking about using a debit card like an ATM card. If so, then absolutely! If you have a debit card with either a Visa or Mastercard logo, you can use the card the same way you would use a similarly branded credit card. Of course you still have to keep records of what you spend to make sure you don’t go wild, but that is also true with credit cards. The only difference is you have longer to sweat waiting for a credit card bill than having the money already out of your account within a couple days.
I have a separate account for my debit card purchases and general spending and another for my checks. That way I don’t run the risk of going into overdraft or bouncing payments and I know that if my debit card doesn’t work, I’m just our of money!