Essential Reasons to Choose Credit Card over Debit Card

Are you torn between using a credit card and a debit card?

There are several reasons to choose a credit card over a debit card when it comes to credit cards. You should know that credit cards provide signup bonuses that are usually not part of debit cards. The bonuses provided by credit cards can be worth hundreds of dollars.

Here are some essential reasons to use credit cards:

Rewards

Depending on the provider, some credit cards also offer cashback ranging from 1% to 5%. Some airlines offer their passengers credit cards that allow the credit cardholders to rack up miles for every spent dollar.

A majority of the frequent flier cards provide signup bonuses that enable their credit cardholders to enjoy a free flight within a set period, usually a couple of months.

Some credit cards give their holders for every dollar spent, and once the credit card holder reaches a certain threshold, the credit card owner can redeem their points in exchange for gift cards. In simple words, you can benefit from potential rewards by using credit cards – the rewards can be cashback, airline meals, hotel points, and credit card points that you can use for travel, statement credit or gift cards.

Safety

Credit cards are a safe payment option, making it easier for credit cardholders to avoid monetary loss caused by potential fraud. Suppose your debit card is used by someone else; the stolen amount simply disappears from your account.

Suppose someone tries to illegally use your credit card, you can instantly notify the credit card provider or company and allow their team of professionals to resolve the matter.

One of the best aspects of credit cards is that the purchases made with credit cards don’t withdraw money from your bank account until the monthly bill is paid. On the other hand, debit card payments cause the immediate removal of your money from your bank account. That said, by using a credit card, you can hold onto your money for much longer than with debit cards – potentially earning you interest.

It also spares you the potential headache of stressing over your lost balance with each financial payment.

Insurance

Most credit card companies provide their holders with insurance for different things like travel (including flight travels) and product warranties. If you are an avid online shopper, you might have noticed that some items are tough to buy with a debit card, which is why you can immensely benefit from a credit card in your wallet.

Besides, you will find it hard to pay for a rental car or make a hotel room booking with your debit card as a traveler. Things like hotel booking and car rentals can sometimes require having a hold of several hundreds of dollars – just in case damages occur.

By using a credit card responsibly, you can also improve your credit score, which isn’t possible with a debit card. The reason is that debit cards aren’t made evident in credit score reports.