what's the difference between a debit/credit card and pros/cons of both ?

Answer 1

There's a very clear difference........

Debit cards:
Money goes straight from your bank account to the account of the person you're making a payment to, and you're limited to paying only what you have in your account + any overdraft/overlimit facility you have on your account.

Credit cards:
pay money straight to the account of whoever you're paying too, but in the form of what is essentially a loan you have to pay back at an extortionately high rates + additional fees & charges that these days absolutely take the p*ss, and everyone's getting sick of, and cause REALLY bad debt problems.
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http://www.fool.com/ccc/debt/debt.htm
http://www.fool.co.uk/get-out-of-debt/get-out-of-debt.aspx
http://www.fool.co.uk/credit-cards/information/what-are-credit-cards.aspx
http://www.fool.co.uk/credit-cards/information/credit-card-pitfalls.aspx

Answer 2

Debit cards are connected right to a checking account and the money is taken right out of your account when it's used. They do not charge any intrest like credit cards do and no monthly bills. As for credit cards, you have a certain amount that you can spend, you are charged intrest on any and all purchaces, get a monthly bill, have minimum payments, late fees if it's not paid on time, over limit fees if you go over the amount you have to spend. Each time you don't pay off what you owe on the credit card, more intrest is accrued on the purchaces. So, in the long run, if you charge $50 and don't pay it off right away, you may be paying $100 by the time it's all paid off. Sometimes they are nice if you have an emergency come up, have no money right then and there and need to use it.
Debit cards are nice because you know that you have the money and are not charged any kind of fees like late fees or interest. The only downfall is, is that if you have no money in your checking account, you can't use it since if you do and no money, you will be charged an overdraft fee like you would if you bounced a check.

Answer 3

Hi!

I have a few things to add..but most of the important facts have been covered..except for a few things. Visa check cards do not immediately take your money out of your checking account.
They work much like credit cards..a amount is put on hold

*maybe*.

(Pre-authorization) unless you select debit..and provide a PIN..just like you would for a bank debit card. Some places automatically do this..process check cards like debit cards...Starbuck's does this. The downside is Starbuck's will not put any money on hold..which can lead to some problems.

It was mentioned that a debit card can cause overdraft fees.
This is not true at all. A debit either works if the money is there..or fails if the money is not there. Check cards can cause overdrafts..but only because on money on hold that you had planned to cover a normal check. I have had check card's cause a negative balance...but never a overdraft fee by themselves.

You should always check with your bank to makle sure.

There is another nasty little fact you need to be aware of that banks will *not* tell you about check cards. Some big companies (AOL, for example)
can do a force pay and bring your account into the negative and bounce checks.

My solution is simple:

Account #1>>No checks..no check card..deposits only
Account #2>> Checks only..no checkcard
Account #3>>Checkard only..no checks.

I can move money from one to another in seconds as needed...either web or by phone. No surprises that way..with one causing problems with another..simply because there is only one way in.

Sometimes banks themselves can make horrible errors. I remember one incident where BOA posted one transaction twice...and caused an overdraft on one check...many moons ago.
After a big fuss..they fixed it and reversed all the fees.

There is another little gotca you need to know about. Let's say you go to radio Shack and buy various parts...even ones you might need..simply because you don't know how many you are going to need. If you paid cash..no problem..you get cash back returning the unneeded parts. If you used the checkcard..you have to wait 7-10 days to get that refund back on the checkcard.

One more possible gotca: What happens if the preauth amount falls off..and they have not presented the bank with the paperwork. Well...the money is taken off hold and is available again. The problem with this is: They have a good bit of time to post this..it may come back..and you need to aware of this.

Bottom line: Write down Visa Checkcard transactions just like checks to avoid problems.

Just a few things from the been-there-please-don't-go-there department.

Ohhh..one more thing. Most banks will forgive at least one overdraft fee per year...just ask.

Answer 4

A debit card looks very much like a credit card with the visa logo, however the purchase that you made from your debit card will be deducted from your checking account. A credit card is just a credit card in which with whatever purchases you made on your credit card, there will be interest charges on that purchase. So, I would use a credit card for large purchases and a debit card for small purchases.

Answer 5

debit cards take the money from your checking account, while credit cards charge it to your credit account. Debit is much better, because you don't get charged interest. Some cards however, are both a debit and a credit card. They charge your bank account if there is money in it, but if there isn't enough money then they charge your credit.

Answer 6

a debit card is on that draws on one or more of your personal accounts i.e. savings or checking account. a credit card draws on a line of credit. The pros of a debit card include: not being charged interest on purchases, not over spending. The pros of a credit card include: it can help your credit score (so long as you make payments on time) and allows you to make larger purchases and then make smaller payments for the item over a period of time.