which iz better?

Question

Credit or Debit Card???

Answer 1

That depends on what you want to do.

A credit card shows up on your TRW which can raise or lower your credit score depending on your balance and payment history. (A debit card does not.) A credit card is like a loan while a debit card is a direct link to money you own. You pay interest on credit cards, but not on debit cards.

Both cards can offer miles, rewards, or cash back, depending on the bank that you go too. Bank of America, Wells Fargo and Citibank all have excellent rewards programs for both their credit and debit cards. However, you will get more rewards for your credit cards then your debit cards.

My recommendation to all my bookkeeping clients is this: Get a credit card with rewards and buy what you need with that. Then, pay the card off every month (if you can) so that way you don't pay interest. This way, you can get money for using your money...or plane tickets, or electronics...It's especially a good idea for people who aren't into balancing their checkbooks.

Hope this helps.

Answer 2

They are two different things. There are good and bad things about both. It really depends on the user.

The debit card pulls directly from you bank account. You have to enter the transactions on you check register and keep track of your balance. You can't rely on the balance shown on the ATM slip since the bank hasn't posted outstanding checks or debit transactions.

And it is very possible to overdraft your account using your debit card. Transactions tend to post quickly but not immediately.

With credit cards you use the banks money and pay interest if you carry balances. Folks get into deep debt by running up credit card balances and only paying minimums.

In either case, people tend to spend more because that little plastic card doesn't seem like real money.