I May Have a 720+ Credit Score, But Am Still Missing Out By Using A Debit Card.

If you’ve made a habit of paying off your credit card balances at the end of every month, I believe that it makes sense to swipe the credit card over the debit card every single time. Of course, a debit card still makes sense to hold in case a certain vendor only takes debit or if you need to withdraw cash from an ATM. Either way, someone with good financial hygiene and a solid credit score north of 700 is leaving valuable points (or cash back) on the table by going for debit over credit. 

Of course, for people who don’t pay off full amounts once their credit card bill comes due, sticking with debit just makes sense. But the key is not to demonize credit cards, as they’re very helpful for those who know how to use them responsibly. Heck, there’s a group of people (churners) out there who actually optimize credit card usage to pay for vacations and other perks.

Like with most tools, it’s more about how you use it. And while you don’t need to be well-versed on all the best credit cards and when to use them, I do think that finding the right credit card(s) and using them for everyday transactions is the best way to get something back for money you would have spent anyway.

Afraid of consumer debt? It still makes sense to put it on credit.

For those who get more peace of mind by swiping the debit card over the credit card (after all, it’ll take the cash right out of your bank account rather than leave you indebted to a credit card firm), it can be a wise move to treat a credit card like a debit card by paying off the amount owed within a few business days. Indeed, you’re given a month to pay off an amount before interest accumulates. And while it’s overkill to pay off a credit card immediately upon transaction, I do think that those who are afraid of consumer debt will get the same peace of mind they would have had if they had opted to pay with a debit card over a credit card.

Of course, the 2% cash back or X amount of points you’ll get from every transaction seems more like a few drops in the bucket than anything meaningful. However, if your expenses are hefty, such drops will gradually accumulate. And you’ll eventually have enough to make a difference. Whether you opt to redeem your points for a prize, go on a trip, or pay off your monthly statement, financially savvy people know just how much savings there are to be had by swiping the right card.

It’s not just about rewards. Debit cards won’t boost your credit score. And you’ll forego essential consumer protection. 

It’s not just points or cash back you’ll accumulate every time you swipe a credit card; you’ll also jolt your credit score. The more you use it (and pay it off on time), the more room your score has to run. Even if you don’t borrow money, a credit score could mean the difference between getting your dream apartment or landing that dream job. So, if your credit score isn’t the best in the world, it’s not too hard to get on the right track. But you’ll have to actually use your card to build credit.

And while there is a wide range of other perks on various credit cards, it’s the consumer protections in place that should give credit card swipers more peace of mind when they go shopping.

If there’s a dispute, a fraudulent transaction, or anything of the sort on a credit card, you’ll be in good hands after you’ve called up the credit card company. If, however, you get the same problems on a debit card, things could get a whole lot messier. And it may prove tougher to get your money back. Either way, the fraud protection attached to credit cards makes debit cards look relatively risky to use, even for the most routine of transactions.

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