POLL: Credit or Debit Cards?

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I have to admit, I never got into, and still don't use a debit card. I have two credit cards I use, one with a cash back option, and the other with a really low interest rate. The cash back one is for every day purchases, and everything from groceries, gas, retail purchases, car repairs, etc. goes on that, and I pay it off every month.

The other card with the low interest rate is for large purchases that I won't be able to pay off in a single month.

I think I favor credit cards because A.) I'm neutrotic when it comes to keeping a budget, and I like the fact that I get a statement every month that breaks down by category exactly what I spent my money on, and B.) There are times that I want to buy something when I don't have enough money to pay for it right then and there, but I will be able to pay for it prior to when the credit card bill becomes due, and I like that flexibility.

Still, I know other people swear by debit cards, and never use anything else.

In case there is some confusion (like people use different terms for debit and credit cards perhaps) here's what I'm talking about.

Credit Card - issued by a bank, even if you don't hold a savings or checking account with them, and they give you a credit limit. You can charge as many purchases as you'd like up to your credit limit, and then you get a bill once a month. If you don't pay the balance off in full, you are charged interest, and the bank makes money.

Debit Card - issued by a bank in which you hold an account with them - usually a checking account. You can use the card to make purchases wihtout any penalty so long as the price of the purchase does not exceed the amount of money in your account. In such cases, the money is deducted directly from your checking account as if you had written a cheque. If you purchase something in excess of the money in your account, you're charged a fee, just like if you bounced a cheque.

So what do you use - feel free to state your reasoning too.

Poll Information
This poll contains 1 question(s). 29 user(s) have voted.
You may not view the results of this poll without voting.

Poll Results: Credit or Debit Cards? (29 votes.)

Credit or Debit Card? (Choose 1)
* I primarily use a credit card - 21% (6)
* I primarily use a debit card - 52% (15)
* I may use either - it entirely depends on what I'm purchasing - 21% (6)
* I'm all about the Benjamins - cash only for me - 7% (2)

 

I never use a debit card - it's giving someone free access into your bank account! If there's an error, it's you against the merchant. At least when there's an error in a credit card transaction, I have the weight of the bank behind me in getting it resolved.

Oh, we never, ever carry a balance, either, and haven't for years.

 

I use both. New Zealand was the first country in the world to introduce widespread debit cards (we call it EFT-POS) so we've been using them for over 20 years now. Nobody in NZ ever carries cash with them any more because debit cards are accepted everywhere. Credit cards are also good, mainly because of the rewards that are now offered with just about every card these days. On my credit card, you earn points which you can turn into vouchers to spend at a wide range of merchants. I have about $500 of points at the moment. The main problem with credit cards is if people can't pay the balance and start paying interest.

Rallymama - that just sounds paranoid to me! I've been using a debit card most of my life and I have never heard of any sort of mistake happening where anyone has lost money.

 

If you weren't disciplined enough to pay the full balance at the end of the month, that's why. Strange though it may seem, there are some people who are not very good at managing their money.

Also, because credit cards aren't accepted every where. Would you use a credit card to buy $5 worth of milk and bread from the corner shop?

 

Well, I personally wouldn't - if it was only $5, I'd probably pay in cash, but there is no reason you WOULDN'T be able to pay with a credit card. At least in the states, the machine that reads the credit and debit cards is the same machine, so if you can use one you can usually use the other. I don't know of any place that accepts debit but not credit cards.

 

Debiit card for me. Credit cards are not v. common here in Finland and pretty much everyone uses one when they are not using cash. If I do get a crediot card somewhere along the line, I will most likely reserve it for online purchases only because I do not like the idea of getting a huge bill at the end of each month.

 

We have both. But our debit cards are funky and always say there's no money in the account, even if there was 5 minutes ago when we checked it!

So we tend to use the credit card for online stuff and cash for everything else. There's nothing worse than being stuck behind a line of people at the supermarket all fiddling about with PIN numbers and signing receipts

 

Interestingly enough, not many places in Finland require a PIN number for debit card putrchases in Finland; the standatrd procedure is to gt IDd ifg the purchase is over a certain sum, but that is about it.

 

But nobody here carries cash any more. What's the point of withdrawing cash from an ATM and then taking that cash to the shop when you could just use your debit card? That way, you get a list on your bank statement of all your purchases so you can see exactly where your money went (rather than just seeing one withdrawal and wondering what you spent it all on). Also, it saves you having to muck around with jingly coins.

Merchants are charged a fee for all credit card transactions so many small shops might not accept credit cards or may have a minimum transaction limit. On the other hand, debit cards are accepted EVERYWHERE.

Huh? It takes 2 seconds to type in 4 digits. Faster than some people counting out their cash and coins.

Yeah, that is like the crazy system they have in the UK where you don't use a PIN for debit cards.

Either way, so long as you are not at fault, there's no way you should end up suffering any loss at all. Someone once nicked a debit card from me by stealing my mail and then proceeded to spend up big on it (this was the silly UK where they don't need PINs). But the bank made sure that they refunded all the money back to me because it wasn't my fault. Banks are so keen to make sure people trust the system that they should always end looking after you (something that would never happen if you lost some cash).

This is a surprisingly interesting thread, by the way, with some surprisingly strong opinions.

 

There's no option for checks! I do any big purchases with a check, and any regular purchases with the cash in my wallet. I applied for a credit card a while ago, though, and it should be coming soon.

 

I use my debit card for everything, even if is only 1 US dollar, my bank account gives me the change of any purchase I make and puts it in another saving account, so I actually make money out of the purchese I made.

 

I haven't used a cheque for years. Anything that I used to use a cheque for, I now pay for via direct deposit in the payee's bank account (using internet banking), for example, buying things through online auctions.

 

No, the bank puts %100 of the change on my saving acct, eg:

I purchase something for 1.75 and i use my debit card.
1.75 comes out of my cheking acct and .25 goes to my saving acct from the bank, not from my pocket.

 

HB, it is not so crazy as it sounds - for any purchase ovewr... 50 euros, iirc, you need to show your ID - and that is waay harder to acquirre than the PIN. If someone gets your debit card and PIN, what they do is go empty your account on the nearest ATM, not shopping.

 

Maurolava, that is the weirdest thing I have ever heard of. For every transaction you do via your debit card, your bank transfers some money from your cheque account to your savings account? Your bank statement must be a disaster, with all sorts of small amounts all over it. Plus you could never tell what everything really cost you.