Debit or Credit Card: Which Should You Choose?

Debit cards and credit cards both have their adherents, with good reason: Each offers distinct advantages and disadvantages. Therefore, Billshark wants to take a look at each, and help you decide which will best suit you.

What’s the Difference?

  • A credit card allows you to charge a certain amount of money up to your approved credit limit.
  • A debit card works like cash, withdrawing the designated amount from your bank account to either cover a purchase or receive cash back.

Which is Better?

When it comes to choosing which card to use, it’s best to consider your own personal shopping patterns and financial aims.

Credit cards


  • In cases of merchant disputes, a credit card offers protection that a debit card doesn’t. For canceled trips, damaged or missing merchandise, or even outright fraud by a merchant, the credit card company will normally refund your money and go after the seller to get its money back.
  • Credit cards allow you to make larger purchases that you don’t have enough money in your bank account to cover.
  • Using a credit card allows you to improve your credit rating. If you have bad credit, a “secured” card—in which you deposit money up front as collateral—can help you rebuild your credit rating.
  • Many credit cards offer such rewards as cash back, merchandise, or travel points.


  • Unless you’re very disciplined, you can get into trouble very quickly by buying more than you can afford.
  • Unless you pay the balance in full every month, you can lose thousands of dollars to interest fees.

Debit cards


  • Remember, a debit card is the same as using cash. Therefore, your transaction may go through more quickly.
  • It’s also a form of self-discipline that keeps you from overspending.
  • A debit card does not cost you anything in interest fees.
  • A pre-paid debit card allows you to load money onto the card, which limits your loss in case of hacking or theft (see below).


  • The biggest disadvantage of using a debit card is the lack of protection for your purchases. Unlike a credit card, if you have trouble after a debit card purchase, you’re on your own to get your money back.
  • Along those same lines, it can be very dangerous to use a debit card online, or even at a store, where systems can more easily be hacked. With a credit card, you have built-in protection, whereas with a debit card, if crooks gain access to your checking account and clean it out, it can be very difficult to get your money back. And while you’re disputing the fraud, you’ll have no cash left to operate with.
  • Using a debit card offers you no opportunity to build your credit.
  • Because you don’t have a traditional checkbook attached to a debit card, you may lose track of how much you’re spending. So it’s necessary to record your purchases as you go.

The bottom line: It’s best to restrict your debit card use to ATM withdrawals only. For all other purchases, a credit card offers better protection for your purchases.

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