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The Battle of Credit Cards and Debit Cards

Some people are still confused about credit cards and debit cards. In this article, let's talk about the advantages of credit cards as well as the advantages of debit cards. Along with advantages, we'll also take a look at the disadvantages of both credit and debit cards. This way, you can make your choice based on facts and useful information.

Advantages and Disadvantages of Credit Cards
One major advantage of a credit card is that it enables its holder to make large purchases in advance and pay them at a later time. Most credit cards allow paying in installments and if you have a 0% interest credit card, it definitely gives you a stronger buying power.

Credit cards with reward programs are also advantageous because it allows the card holder to get more from his purchases. Additional privileges and incentives that are only exclusive to the reward credit card member also make it an attractive option for consumers.

Nevertheless, the convenience of being able to buy without cash can become a disadvantage if discipline is not implemented. All too often, misuse of credit cards or uncontrolled spending has put millions of consumers around the world in serious debt.

If you're not careful about using your credit card and submitting your payments, you can get easily stuck in credit card debt. The high interest rates imposed by many credit cards alone can put you in a mire of debt before you even realize the problem.

Advantages and Disadvantages of Debit Cards
What about debit cards? You can only use your debit card for purchases if you have funds in your account. In other words, you can only charge to your debit card the money that you have. You cannot borrow charges or make advanced purchases for you to pay later. You can only use your debit card as a safer way to shop because you don't need to bring cash.

Another use of debit cards is to transfer money without the need to pay for remittance charges. If you're a parent with a college student who stays in a boarding school, a debit card is an ideal way to send allowances. Business owners also use debit cards to send payments to their freelance workers at different locations.

The disadvantage of a debit card is that it doesn't give as much flexibility as a credit card does. For some people, it's just like wallet to place in your cash. If you don't have the money to spend, then a debit card has pretty much no use at all.

Nevertheless, there are situations where using a debit card is a better option than a credit card. Lastly, the flexibilities provided by a credit card should always be accompanied by a strong sense of responsibility by the card holder.

Some credit card companies have issued credit cards with debit card functionalities as well. But there are disadvantages about them. For one, you can incur expensive charges on your card each time you access your debit account.

Second, you may be at a greater risk to ID theft if you use your credit card as debit since you will not be asked to enter your PIN or security codes. In this case, using your credit card as a debit card should be done with extreme caution.

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