Whats the difference between a debit card and a credit card?
So I just got a job and started working for the first time, and have some money. I plan to open a bank account at Bank of America, what’s the difference between a debit card and a credit card? Which would be best for a person that plans to do lots of online shopping and doesn’t want to pay all types of fee’s for making purchases? Also there’s things like a check card, atm etcc can you tell me what those are?
Hi there,
You may want to consider getting BOTH a credit card and a debit card. A credit card is far better for online purchases and will help you build credit, whereas a debit card will allow you to have instant access to your cash (in your bank account).
Here’s the deal: A credit card is paid for by the creditor (bank or credit card company) with the understanding that you will pay back that money in a timely manner. A credit card, unlike a debit card, will: 1) help you establish and build credit (assuming you pay your bills on time every month) and 2) provide you with safeguards against fraudulent activity when you make purchases online.
A debit card, also known as a bank card or check card, is tied directly to an account – typically a checking account – and withdraws funds from that account when you buy something. However, unlike a credit card, a debit card does not help you establish or build credit, and it doesn’t provide as many safeguards when making online purchases.
A debit card can also be an ATM card. Because it’s tied to a bank account, you can use it to withdraw money from the ATM or for purchases via debit.