August 8, 2010

August 8, 2010
Credit or Debit?

Welcome to another day in my life. Today is Sunday and I hope you are having a safe and great weekend. Dab the AIDS Bear and I finally get a day of rest after a very long and busy week.

Now as you know Dab the AIDS Bear and I spend a lot of time going around the world helping other organizations and children affected and effected by HIV and AIDS. So I use my debit and credit cards a lot so I do not have to carry cash with me.

Which leads to the question: When is it better to use a debit card versus a credit card?

Debit cards are fine for everyday purchases. Since the money comes instantly out of your bank account, you may be less inclined to overspend. And you canít run up balances the way you can with a credit card.

But credit cards are often a better choice for big ticket and online purchases. You avoid instantly draining your bank account of large amounts, and you can get better protection if there is a problem with the purchase.

For example, you can withhold payment or more easily dispute a charge. In addition, credit cards often offer better rewards than debit cards, and sometimes provide extended warranty protection and theft insurance for things you buy.

Credit cards are also a wiser choice for transactions in which the final bill is uncertain hotels, for instance, where you might run up a room service tab. When you present a debit card on check in, the clerk is allowed to put a hold on your account for your room rate plus the hotelís guess at your incidentals.

When the transaction finally clears it could take up to two days after checkout you sre debited only for what you actually spent, but in the meantime you have been at higher risk for bounced checks and overdrafts. Rental car agencies also put holds on your accounts, as do self service gas stations they put a hold on $50, even if you only buy $10 of gas.

So now you know what to do. Hope all of you have a great week.

Until we meet again; here's wishing you health, hope, happiness and just enough.

big bear hug,

Daddy Dab