Debit cards

Ima saver · #1 (**permalink**) 10-17-2006, 10:54 AM

I am reading an article in "Debt-proof Living" telling the scary truth about debit cards. What do you think?

disneysteve · #2 (**permalink**) 10-17-2006, 10:56 AM

Can you send a link to the article or post it?

Ima saver · #3 (**permalink**) 10-17-2006, 11:00 AM

Sorry Steve, I don't know how to do that, I am new to computers. I will just mention some of the things in the article.
For one, you should know that debit cards do not carry the same protection against fraudulent use, as a credit card. It will, but ONLY, if you notify the bank within 2 days of losing your card. If you wait longer than that, you could lose up to $500. If you don't report a problem within 60 days, you are stuck paying for the thief's spending spree. You could lose everything in your checking account and your overdraft account too.

disneysteve · #4 (**permalink**) 10-17-2006, 11:03 AM

Quote:

Originally Posted by Ima saver

Sorry Steve, I don't know how to do that, I am new to computers. I will just mention some of the things in the article.
For one, you should know that debit cards do not carry the same protection against fraudulent use, as a credit card. It will, but ONLY, if you notify the bank within 2 days of losing your card. If you wait longer than that, you could lose up to $500. If you don't report a problem within 60 days, you are stuck paying for the thief's spending spree. You could lose everything in your checking account and your overdraft account too.

This isn't news to me. Also, even if you do report the card stolen, the money is already out of your account and you need to wait for it to be returned. Much different than fraudulent credit card charges where you can just not pay that portion of the bill.

sweeps · #5 (**permalink**) 10-17-2006, 11:11 AM

Compared to credit cards:
1. No float.
2. No rewards (usually). If you get rewards, they're inferior to those of credit cards.
3. Less protection in terms of theft, loss, warranty extension, rental coverage, etc. If your card is stolen could take a long time to replace the funds -- possibly causing overdrafts.
4. No build-up of credit history.
5. More difficult to use when multiple people have access to the account. Usually need more buffer in your checking account to prevent overdrafts.

disneysteve · #6 (**permalink**) 10-17-2006, 11:14 AM

Also, merchants can place a hold on your account when you make a hotel reservation or something like that.

rduell · #7 (**permalink**) 10-17-2006, 11:23 AM

Did it say anything about using a debit card as credit? Whenever I use my card I'm asked if I want debit or credit. I usually do debit, but always wonder if credit would be better or any different. They both take the money from the account immediately, right?

tinapbeana · #8 (**permalink**) 10-17-2006, 11:26 AM

or when you use it to pay for gas at the pump.

poundwise · #9 (**permalink**) 10-17-2006, 11:30 AM

I do not have a 'logo-ed' debit card tied to my primary checking. I don't ever intend to nor do I recommend it.

Ima saver · #10 (**permalink**) 10-17-2006, 11:33 AM

I think when they ask debit or credit, they are asking what kind of card you have. Even if it has a visa or m/c logo, you do not have the right to dispute the amount if the item is unsatisfactory. It states that a debit card is really just an electronic check.

vsjhoc · #11 (**permalink**) 10-17-2006, 11:34 AM

Quote:

Originally Posted by rduell

Did it say anything about using a debit card as credit? Whenever I use my card I'm asked if I want debit or credit. I usually do debit, but always wonder if credit would be better or any different. They both take the money from the account immediately, right?

I think they are not asking you if you "want" debit or credit. The store is asking you whether you have a debit card or a credit card, because they process them differently. I don't think the same card can function as either a debit or a credit card. (But I could be wrong. Happens all the time.

) So it depends on what's in your wallet.

Debit card: acts like a check that clears instantly, so the money is taken out of your account immediately

Credit card: gets charged to your account immediately for payment later, depending on the due date for your account

JoyJoy · #12 (**permalink**) 10-17-2006, 11:35 AM

It is wise to use credit cards to purchase online rather than debit cards. I usually say "credit" when purchasing things.

Sorry that link didn't take you directly there. I did read it at DebtProof Living after I googled it. It's the magazine for this month of October.

greedy4chips · #13 (**permalink**) 10-17-2006, 11:35 AM

Ima,

How to post link to an article.

1. If you are creating "New Thread" or use the "Go Advanced" when replying click the "Globe" icon from the selection above the text box area where you type your message.

2. Type in the words you want me to see in the link...click ok

3. Cut and paste the link into the next box...click ok

4. Voila you are done...use preview post to see if the link works.

Alternate method...simpler but less attractive.

1. Cut and paste the link from the address bar for the article you wish to link to and just put it into your post.

Hope that helps!

vsjhoc · #14 (**permalink**) 10-17-2006, 11:36 AM

Quote:

Originally Posted by poundwise

I do not have a 'logo-ed' debit card tied to my primary checking. I don't ever intend to nor do I recommend it.

Why? Because of the reasons listed below, or something else?

Elgin526 · #15 (**permalink**) 10-17-2006, 11:39 AM

These are the reasons I only use my debit card to pay for gas and groceries, and to get cash out. I look at my account everyday online so I'd spot any fraud right away, and since my card is at the front of my wallet, I'd notice if it were missing right away (I buy a cup of coffee every morning and I'd spot it then). Even if my card was stolen and I didn't report it right away, the most I keep in there is $300, and I don't have it linked to my savings and I don't have overdraft protection. The worst they could do is get the $300, cause once that was gone it would just be declined.

Debit cards are convienant and do have advantages, but they aren't good for everything and one must understand how they work and keep on top of their accounts.

Ima saver · #16 (**permalink**) 10-17-2006, 11:41 AM

I don't have a debit card at all. I also do not know how to cut and paste. I don't know how to do anything on a computer but type.
Clark Howard is against debit cards. By the way, There are 2 types of debit cards, direct debit cards and deferred debit cards.
A direct debit card requires a PIN, the deferred debit card requires users signature.
The deferred debit card has a visa or m/c logo. It will take 2 or 3 days to clear your bank account.

JoyJoy · #17 (**permalink**) 10-17-2006, 11:46 AM

I went to Google.com and

(1) Typed in Debt Proof Living Home
(2) Where it says "Current issue DPL" I clicked on that and it took me to the article Ima is talking about.

Ima, don't feel bad...if you are like me, you're fortunate to find your way back to this site!

rduell · #18 (**permalink**) 10-17-2006, 11:48 AM

Quote:

Originally Posted by vsjhoc

I think they are not asking you if you "want" debit or credit. The store is asking you whether you have a debit card or a credit card, because they process them differently. I don't think the same card can function as either a debit or a credit card. (But I could be wrong. Happens all the time.

) So it depends on what's in your wallet.

Debit card: acts like a check that clears instantly, so the money is taken out of your account immediately

Credit card: gets charged to your account immediately for payment later, depending on the due date for your account

Thanks for the replies.

I have used the same card for both debit and credit. If I choose debit, I put in my pin number. If I say credit they have me sign. But both ways take the money out of my account that same day. I have checked on-line. This is the card that was issued by my bank for ATM use, if that makes any difference. It has a Visa logo on it. I've used it for years like this. I just wondered if there was any more protection by choosing one over the other.

PRICEPLUS · #19 (**permalink**) 10-17-2006, 02:56 PM

I believe Sweepsplayer has laid it our quite succinctly about debit cards!

Gruntina · #20 (**permalink**) 10-17-2006, 03:33 PM

Quote:

Originally Posted by rduell

Thanks for the replies.

I have used the same card for both debit and credit. If I choose debit, I put in my pin number. If I say credit they have me sign. But both ways take the money out of my account that same day. I have checked on-line. This is the card that was issued by my bank for ATM use, if that makes any difference. It has a Visa logo on it. I've used it for years like this. I just wondered if there was any more protection by choosing one over the other.

I do the same thing. I prefer to use Debit instead of Credit because you need a pin number to get approved for the payment. If I used Credit... anyone can swipe the card and forge my signatures.... (This is why I always write "Please see ID" on all of my cards so it can not be copied). But often, my card does not get check with ID. I rather the ATM is a Debit only card so no one can steal it and use it as a Credit. But again, some cashiers do not even bother to check ID and signature matching.