Friday, January 1, 2021

Why Should You Use Credit Cards Instead of Debit Cards?

Should you get a credit card or a debit card for your personal needs? Millions of people gravitate towards credit cards, while others will opt for a debit card. You could be wondering which one will be more beneficial to you when you're making purchases or to manage your daily expenses. Choosing a card should not be so difficult or overwhelming for you. Here are a few key differences between credit cards and debit cards.

Easier Budgeting and Spending

Are you an impulsive shopper, struggling to control your spending habits? You may find it easier to stick to your budget when you use a debit card. Debit cards are extremely beneficial because they prevent you from overspending. With a debit card, you 'll know exactly how much money you have in your account and how much you can afford to spend. This is a key advantage that allows you to spend more responsibly and avoid going into debt.

High Interest Rates and Fees

You should be aware that there are only a few fees involved when you use a debit card. On the other hand, you will have to deal with credit card fees that may include late payment charges, returned payment fees, foreign transaction fees etc. Since a credit card is a short term loan, you will have to repay the loan with interest. For this reason, if you're shopping for a loan, you should be aware of your credit card's APR rate, which means annual percentage rate. Keep in mind, a credit card with a high interest rate can become expensive if you're not paying off your balance.

Consider Both Pros and Cons

Be sure to consider both pros and cons when you're trying to figure out if you should get a debit or credit card. You need to decide which card is more suitable for your lifestyle and allows you to have fewer issues.

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