Financial Tip Friday: Dab On Debit Without Using Credit

By Kawan Yarbrough

What’s the difference between a debit card & a credit card? I personally prefer debit. Here’s why!

What's a credit card?

  • Credit cards allow consumers to borrow money from the financial institution up to a certain limit in order to purchase items or even withdraw cash. 
  • You are given your own spending limit, and have a monthly billing cycle
  • Highly affects your credit score
  • Charges you fees known as interest, which comes from what you owe. i.e. If you have a $250 credit card, your interest could require you to pay $300 back for their service instead of just $250. 

If those credit cards aren’t paid off on time, or at all, that affects your credit score. A bad credit score is not good to big companies. Want a car? Want a house one day? You have to have good credit.

What's a debit card?

  • A debit card allows you to spend money that you already have.
  • Some debit cards allow you to use it like a credit card (spending without entering a pin code), but still it's with YOUR money that's in your account
  • There's most likely no interest fees 

I personally prefer debit cards for these of reasons:

  • With a debit card, you actually are spending money you have
  • You don’t have to worry about this extra credit card bill each month
  • You can track your spending on your phone or online

If one were to get a credit card, here are a few things to consider:

  • Spend wisely
  • Don’t buy things that you know you won’t be able to pay back when the bill comes
  • Pay your  bills back in full every time to help build up your credit score
  • Don’t get a credit card until you’re financially literate and ready
  • When you buy something, pay it off immediately  

Eventually, you’re going to need a credit card, how you use it is all up to you. A credit card isn’t for a haircut or some new shoes; it’s for emergencies and should be used as such.  If you get it, be smart.

For more information visit the following:  

More info here about credit cards! 

More info here about debit vs credit!

Hopefully these tips were helpful! Do you have any? Leave some tips in the comments below! Meanwhile I'll be dabbing to the bank!