Are Debit Cards a Good Choice for You?

Debit cards are a way to pay cash for purchases without carrying a lot of cash with you. ATM cards work the same way and can be used wherever credit cards are accepted. Most are tied to Visa or MasterCard. Here’s why people like them:

• You’re spending your cash on hand. Get overdraft protection in case you make a mistake.
• You can get cash back at the supermarket or drug store, avoiding a trip to the ATM. It also avoids paying an ATM fee.
• You avoid paying interest as you probably would on a credit card.
• Some debit cards are tied to rewards. Banks such as Chase, Wells Fargo, Bank of America, and Citibank have programs that give points for frequent flier miles and other rewards.
• Because the debit card is tied to Visa or MasterCard most have “zero liability.” Check with your bank to determine how long you have in order to report a fraud or theft.

Credit advisor Jane Bryant Quinn gives this advice on debit card use: “Don’t use debit cards for purchases over the Internet. A thief could wipe out your bank account before you know about it. Make your purchases by credit card or over the telephone.”