As more and more people use debit cards rather than cash or a credit card, it is important to make the best use of this convenient resource. Doing so not only helps to keep debt to a minimum, but can also help generate a little more income for the household. Here are some tips on how to get the most from your card, while still improving your finances.
The important thing to remember is that your debit card is not a credit card; you are, in effect, still paying cash, just in a different manner. Be mindful of your account balance at all times, and do not rely on fund transfers from other sources to take care of overdrafts created by using the card. Financial institutions that do allow overdrafts due to debit purchases often impose significant penalties when they take place. Save yourself time and money, and always record your debit card purchases just as if you were writing a cheque.
Second, ask about cash back plans for your debit card. Plans of this type provide a reward in the form of reimbursing you for a small percentage of a qualified purchase made using the card. While the amount may not seem like much per transaction, it can add up to an impressive amount over time if you use the card in supermarkets, to make utility payments, or to shop at certain retailers.
Compare the debit card privileges offered by different banking institutions. You may find some small differences in cash back programs, as well as perks that are unique to a particular bank or other financial institution. Go with the plan that offers you the most benefits, while creating the smallest amount of expense in the way of account fees, and you’ll find that the card actually helps to stretch your monthly budget a bit.
A debit card is a wonderful way to have access to the cash in your bank account without actually carrying money on your person. It also provides the same ease of use as a credit card. By managing the use of your debit card properly, you need never worry about overdrafts and will actually earn a small return that can be spent on anything you like.
Tags: credit card, Debit Card
