Debt occurs when we purchase some goods or services through the credit cards. Each consumer can use the credit card for a particular limit. The amount made for the purchase can be paid few days later. When you fail to make the payment on time, it will result in late payment charges. Reckless spending is also because of the credit cards. People don’t have an account of how much they spend. Consumers purchase items even when they do not have the money for it with the help of credit cards, even when they know that they will not be able to afford it later on. Thus the credit keeps accumulating and eventually leading to debt.
On the contrary, the debit card or the prepaid cards are a sensible option. These kinds of prepaid cards can be loaded or recharged with particular amount of money. Only this amount can be spent and when the card is deprived of all the money, it becomes declined. Consumers will not be able to spend more than they can afford. These prepaid cards such as visa and master are accepted all around the world. Online shopping has become more prominent. Consumers can shop online throughout the day and the products are delivered home. When online transactions are done through credit cards, certain spammers acquire critical information and use it for their own benefits. Such acquisitions are very difficult to trace when you use a debit card. But sensitive information about the debit cards cannot be stolen or used easily. Secret pin numbers are provided to be given for each transaction. So they are relatively safer.
Debit cards are now available to consumer when they open their bank account for free of charge. The debit card option is very useful to keep track of your spending. We can always get statements very easily through the ATM machines. They are also very useful to keep track of your kid’s expenses. Debit cards can be accessed by personal identification number or through authorized signatures. They do not have the hassle of late payments and other fees that comes along with the burden of credit cards.
Money can be deposited in the Debit cards through various means. Your salary can be directly credited into the debit card. You can also deposit money in your savings account which would be accessible through your debit cards. Debit cards save you from carrying huge amount of money or checks. If you lose your wallet or purse, then all your cash is lost but if you lose your debit card, you just need to call the respective people and block your card. All your money remains safe in your account. Any problems regarding the debit cards can be handled the same way that you handle credit card. There is twenty four hour customer care system. They will assist you with any sort of mishaps or problems.
Debit cards are really useful for sensible spending. When you spend your money, then you spend it sensibly. But, when you spend through your credit card, you end up in a reckless spending spree without thinking about the consequences. Credit card provides a false secure feeling in a lot of people. I have known people who have turned into shopaholics because of the credit cards. They are still working towards paying off their debts. You tend to pay back triple the amount you spend. Credit cards always have hidden charges for every transaction you make. So always check your bills properly and get all the doubts clarified before making any payments. If you own a credit card then make sure you make all your payments on time, else you would end up paying more than the amount you actually spend. Credit card companies don’t help you to spend. The more money you spend, more they make.
So always carry credit cards as a secondary option and never rely on them. Use them only for emergency. Never give your kids credit cards. Open up a savings account and give them a debit card. It is much safer for you and also the kids. Create the awareness to your kids also. There are plenty in the United States who have been affected by the credit cards. So please take precautionary measures and spend wisely. If it is one thing that the recession has taught us is that, you can never be too sure of what comes tomorrow. So be prepared.
Resource Box:I am Krithika Sathyaraj working for Consumerdaddy website.We write many blogs and articles to create consumer
awareness.Consumerdaddy is a leading consumer protection portal in India with consumer reports for over 40,000 companies
and 200,000 products.
Why consumers should choose Debit cards over Credit cards