What You Need to Know About Debit Cards

Victoria’s Secret having one of their semi-annual sales? Or tempted by the fruit of Amazon Prime? It’s OK to indulge (if you have the funds, of course), but savings experts at CouponSherpa.com, Kendal Perez tells Bustle to never use your debit card to purchase those things in your shopping cart. Why? For your own protection.

“Women should avoid using their debit card when shopping online since these cards don’t have as much fraud protection compared to credit cards," she says. "If your debit card information is compromised, you could see your checking account wiped out by thieves. You can dispute these charges with your bank, but the process can take a while and having your funds tied up in the meantime can have huge consequences. When your credit card information is compromised, you simply see a pending charge which you can quickly dispute prior to any money leaving your checking account."

Finally ponying up and booking that trip to Europe with friends? Or need to pay for some pricey, not-covered-by-insurance dental work? While your debit card might be an easy way to pay quickly and not think about it again, Perez says to use a credit card instead. “If you’re buying big-ticket items, it’s better to make these purchases with credit cards, and pay off the balance in full, compared to debit cards should you decide to return the item, especially if the merchant delays your refund," she says. "Having your checking account funds tied up in a return can cause other problems depending on what bills/expenses you have."

It’s only four digits, but it’s basically an invitation into your most personal and protected information. That’s why Perez says it’s essential you memorize this number, but never put it down on paper. “It may be tempting to keep your pin number in your wallet, but this increases your risk of having your checking account cleared out by thieves who get their hands on your purse or wallet," she says."

Those overdraft fees that I kept paying — and fighting — in college? Well, I was definitely not alone on that financial struggle bus. According to CEO and co-founder of RewardExpert.com, Roman Shteyn, this is one way for banks to get even more out of your wallet. “One of the biggest downsides to using a debit card is getting blindsided by fees. For consumers who don’t keep close tabs on their balance, they may unknowingly get overdrafted and end getting footed with a fee,” he says.

Unsurprisingly, overdraft fees aren’t the only type of fee that banks will sucker you out of. When you’re in a bind and need cash ASAP, you might be tempted to stop by a shady ATM, that might not only be unsafe from a security perspective, but also rob you of up to $5 for one transaction.

“In addition to overdraft fees, debit card users should be wary of ATM fees," Shteyn says. "Using an ATM from a bank that isn’t yours can rack up fees pretty quickly. Use your bank’s ATM finder web tool to locate branches and ATMs near you that won’t charge a fee. Or buy a pack of gum at your local drugstore and opt for cash back at check out — at least you’ll get something in exchange for the ‘fee.’”

Though it’s a good idea to have a debit card to have access to your checking account (and hey, we all need cold, hard cash on the reg), your debit card won’t help you build your credit. And without credit, it’s tough to get important loans for opening a business, buying a house or even renting an apartment.

“Debit cards do not build credit, and credit history can be important for everything from renting an apartment to getting a cell phone plan," founder of CreditCardInsider.com, John Gantois tells Bustle. "Credit cards also have extra protections on purchases, like extended warranties, and don't need to cost anything. As long as you are only charging to a credit card what you can afford to pay off in full, on time when the bill is due you won't end up in credit card debt.”

If you have a credit card, then you have probably received a fraud alert, without even knowing someone hacked into your system. With credit card companies, it’s a relatively simple and painless process to solve the issue, but with debit cards, it gets much more complicated and time-consuming.

“When your debit card information is stolen and used fraudulently, the money often leaves your checking account right away and doesn't come back until after the fraud investigation is complete," Ganotis says. "With credit cards, you are not liable for fraudulent purchases, and the money does not immediately leave your checking account like it does with a debit card. The credit card company is on the hook for that money until the fraud investigation is complete, unlike with a debit card.”

Going on a trip and need to rent a car or book a hotel room? Your debit card won’t cut it. “Generally, debit cards are not accepted for incidentals at hotels or car rentals," Gantois says. "Most hotels will require you leave a credit card on file for possible damage to the room, and even if they will accept a debit card as payment for the room they generally will not accept a debit card for incidentals."

There you have it, from overdraft fees to the difficulty with proving fraud, it definitely ~pays~ to stay informed about your debit cards.

Check out the “Get Money” stream in the Bustle App for more tips and tricks on how to save and spend your money.