Many people consistently stress the importance of always using debit or cash exclusively, but here are a number of reasons why it may in fact be much better to opt for credit the next time you are making a big purchase or sitting in the checkout line.
Credit Cards are Cheaper
A common belief is that credit cards are incredibly expensive to use, but that is not always the case. As long as you pay off your credit card in full before the end of the month, these cards can actually be completely free to use. On the other hand, debit-card transactions can cost anywhere from .25 cents all the way up to $1.50 depending on where you are using it and what you are purchasing.
Credit Cards Don’t Come with a Hold
When you opt to use your debit card for bookings or even to fill up your gas tank, there are many vendors that will block out your account until the purchase has been completely processed. And on top of that, the block amount can often be much higher than the actual price of your purchase.For instance, if you spend $25 on gas there are times where up to $100 can be blocked until the purchase goes through, which can not only be inconvenient, but also result in hefty overdraft charges.
Credit Card Rewards
There are a few debit cards that are now offering rewards, but there is nothing quite like what credit card companies offer their users. You can benefit from cash-back, air miles, rewards, and bonuses each and every time you spend money depending on the credit card you use.
If you were ever to get into a dispute with a vendor or merchant, it can be incredibly difficult to take action against them when you have made the purchase with a debit card. However, if you use a credit card for your purchase then it is much easier to reverse the charges after discussing the situation with your credit card company.
Protection from Liability
If you lose your credit card or it is stolen, you are commonly only responsible for $50 worth of charges, even if someone piles up the charges to the tune of a few thousand dollars. If the same thing happens with your debit card, you can be responsible for up to $500 worth of the charges, unless you take immediate action.
If you are responsible with paying your bills, and religious about not missing a payment, there can be far greater benefits for using a credit card rather than a debit card. It is important never to overspend and keep things within your means, but if you can do so, then making purchases with your credit card can be an incredibly smart idea.