Читать книгу Personal Finance in Your 20s & 30s For Dummies - Eric Tyson - Страница 56

Just because you get rid of your credit cards doesn’t mean you have to always pay by check or cash. Enter the debit card, which offers you the convenience of making purchases with a piece of plastic without the temptation or ability to run up credit-card debt. A debit card looks just like a credit card with either the Visa or Mastercard logo. Debit cards have the following characteristics, which are different from credit cards:

 Deduction from your checking account: As with checks, debit-card purchase amounts are deducted electronically from your checking account typically within one or two business days. By contrast, if you pay your credit-card bill in full and on time each month, your credit card gives you free use of the money you owe until it’s time to pay the bill.

 Potential for overdrawing your checking account: If you switch to a debit card and you keep your checking-account balance low and don’t consistently track your account balance, you may need to start doing so. Otherwise, you may incur an overdraft (an attempt to withdraw more money than is available in your checking account) and unnecessary overdraft fees (fees charged when you overdraw your account). Overdraft protection may be worth considering, but beware of the temptation to use that as an ongoing, high-interest credit line on balances borrowed, similar to a credit card.

 Shorter window of time for making disputes: Credit cards make it easier for you to dispute charges for problematic merchandise through the issuing bank. Most banks allow you to dispute charges for up to 60 days after purchase and will credit the disputed amount to your account, pending resolution. (Longer exceptions are allowed in some circumstances, for example when a contractor is doing work for you over a period of time.) Most debit cards offer a much shorter window, typically less than one week, for making disputes. (Despite widespread misperception, personal debit cards have identical fraud protection to personal credit cards.)

If you don’t already have a debit card, ask your current bank whether it offers Visa or Mastercard debit cards. If your bank doesn’t offer one, shop among the major banks in your area, which are likely to offer such debit cards. As debit cards come with checking accounts, do some comparison shopping between the different account features and fees. Check out Chapter 11 for more information about finding the right bank for you.

Also check out getting a Visa or Mastercard debit card with the asset-management accounts offered by investment firms. Asset-management accounts basically are accounts that combine your investments, such as stocks, bonds, and mutual funds, with a transaction account. Check out the investment firms that I recommend in Chapter 12 for brokerage services with competitive investment offerings and prices and asset management accounts. (Note: Unfortunately, Vanguard discontinued offering their asset management account but may reintroduce it in the future, so stay tuned.)