Debit cards, similar to the credit cards, make shopping and paying bills very convenient. With no need to bring cash all the time, you just present the card to pay for items and your bills.
Between the two, however, many find the debit card more beneficial. Unlike the credit card that accumulates interests and other fees for every transaction, it is normally devoid of such fees. And since it works just like cash, you don’t have to worry about being charged for other fees every time you use it. Also, you will not be tempted to spend more than what you can afford because you will no longer be allowed to purchase if the debit card does not have sufficient funds left.
Unfortunately, customers living in the states of George, New Mexico, Nevada and Oregon will soon have to start paying a minimal monthly fee for their use of the card. The monthly fee of $3 will take effect this October 14, 2011 for customers of Wells Fargo. Chase is testing a $3 fee. Experts point that that with this new fees being charged to debit card holders, there is a big possibility that rewards will be eliminated.
If you’re banking with Wells Fargo and Chase, you may want to gather more information about this impending monthly fee. Otherwise, you have other options such as to open an account with another bank that has a better offer. There are many online banks today that provide debit cards free from fees.
You can choose ING Direct which offers a so called Electronic Orange checking account that comes with a free MasterCard debit card. In addition, those who open new accounts are given a $50 bonus. On the other hand, you can choose PerkStreet Financial if you want to gain some cash back. This company offers a free debit card that lets you earn up to 5 percent cash back.
Many people find it safer to use the debit card. Since you need to fund this card in order to use it, there’s little chance of abuse. At least with this type of card, users will be a more conscious of how much they’re going to spend based on the amount that’s been deposited or the existing balance of that particular card.
Whereas with the credit card, many people don’t think about how much they’re going to spend particularly if they know they have a high credit limit. What happens then is they feel confident of buying whatever it is they fancy and then regretting later after seeing their high credit card bills.
Other than the debit card, budget conscious consumers may also consider the prepaid cards. These cards can be used effectively and don’t charge high fees like the credit cards. Some major retail companies offer this and some of them even offer cash rebates on certain purchases. An example is the Walmart MoneyCard.
