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How to Decide between Getting a Credit or Debit Card

In this day and age, people use less paper, and more plastic. But which kind of plastic is best for you?


  • Step 1: Assess your finances Ask yourself a few questions. What you want to use your credit or debit card for? Is it for convenience? Do you want buyer’s insurance? Do you want to improve your credit score?
  • TIP: Debit cards are easier to get approved for than credit cards.
  • Step 2: Gather information Gather all the information. Be sure to read about all charges and rules on both credit and debit cards.
  • Step 3: Choose a credit card If you think you can pay off the balance in full every month, choose a credit card. It helps you build a credit history, and there are more perks, like rewards, cash back, travel and buyer’s insurance. You also get more protection if your information is stolen or lost.
  • Step 4: Get a no-fee card Choose a "no-fee" card with a zero percent interest introductory rate. Read any pamphlets and updates that the company sends, and pay your in full balance every single month.
  • Step 5: Assess your habits Be honest with yourself. If you are prone to accruing debt, a debit card is a good choice for debt deterrence, because they are directly linked to your checking account, and you will incur a penalty immediately if you overdraw.
  • TIP: Merchants will ask you if you'd like "credit" or "debit." Choose "credit" to avoid entering your PIN number, which will protect you from identity theft.
  • Step 6: Get a debit card If you think you want a debit card, read the bank's policies to see what penalties there are for exceeding your account balance. Remember – you’ll have to keep close track of how much money is in your checking account. Now plunk your plastic with impunity!
  • FACT: The first credit card was issued in 1951 by Frank McNamara, founder of the "Diners Club," for customers to use at restaurants in New York.

You Will Need

  • Awareness of your spending habits
  • Knowledge of your credit history

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