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There are some very good reasons to have a debit card. For one thing, you can’t run up debt on a debit card. These cards are generally tied to your checking or savings account so that if you completely deplete that account, you can no longer use the debit card. However, there are also some reasons why a credit card can be better than a debit card.
The first of these is that you can build up your credit score with a credit card but not a debit card. When you use a credit card sensibly – especially if you pay off the balance on time every month – this will definitely have a positive affect on your credit score. In comparison, what you do with your debit card will have no affect on it.
Budgeting can also be easier with a credit card as all your transactions will show up on your statement at the end of every month. Good budgeting begins with tracking your spending so that you’ll know where your money’s gone. A credit card statement will help you understand this and see those areas where you might be able to reduce your spending.
Third, debit cards do not come with rewards as credit cards do. When you choose a credit card that comes with great rewards such as miles or cash back, this will help you get more bang out of every buck you spend.
Finally, credit cards give you more protection as a consumer than do debit cards. With most cards, your liability is capped at $50 if someone steals your identity or misappropriates your card. While debit cards do offer protection against fraud it could be as many as two months before you get back the money that was stolen.