Credit Card

Payment Methods: Cash, Debit or Credit?

Payment Methods

Alternate Payment Methods; Choosing The Right One for You

When making purchases, the method you choose to make your payments can depend on a lot of things, especially your financial circumstances. Some say it’s always better to pay with cash, but credit cards are a more powerful and flexible option, debit cards keep you in check and make you more responsible with your spending and a whole plethora of different opinions. Let’s discuss each payment methods option and their benefits in certain situations to facilitate the making of that very important decision.


Keeping cash on hand and spending only that certain amount on any given day is a great way to track your money. You can choose the exact amount of cash your actually willing to spend, carry only that and then stop spending when you run out of it, or if you carry an ATM card, you are less likely to give in to temptation of spending because the few minutes to make a withdrawal will give you time to rethink your decision. This is a great way to prevent you from overspending. And the best part is it’s accepted everywhere.

If you withdraw a lump sum amount from your bank every once in awhile, it will lower your bank fees exponentially as compared to when you’re making multiple $20 transactions. The two major drawbacks of keeping cash though can be, depending on your situation and personality, the off chance of theft and the ‘burning a hole’ temptation. So if you want to be responsible and can resist temptations, cash payments are the way for you.

Credit Cards

If you are trying to build up your credit history, a responsibly used credit card is a safe and secure way to do so. Credit cards are very convenient and widely accepted for a variety of purchases. They are your safest bet when shopping online and during large investments because most, if not all, credit card issuers watch out for fraudulent charges; provide the best protection under the Fair Credit Billing Act with a minimum liability of zero to $50 upon the report of an unauthorized or stolen credit card. They are usually the best option when traveling or on vacation.

Reward points open up some perks, from travel miles to discounts on car rentals. Many hotels and travel companies make reservations on credit cards only. While it is practical to save ahead and be prepared for any eventuality, credit cards can be literal lifesavers in cases of emergency. However, the thing to keep in mind is that as convenient as credit cards can be, they can also land you in a whole lot of trouble if not used with caution. Late payments on monthly dues will have you incurring interest charges on remaining balance and ultimately can land you under a massive pile of debt and credit card fees with a forever present added risk of credit card theft or compromise of information.

Debit Cards

Debit card payment methods have, in recent years, become the most popular method of making payments. Two ways of making purchases, one of which, the ‘signature debit’ that clears through Visa or MasterCard gives you the same rights in a dispute or error as that of a credit card. The transaction will clear your account in a day or two. ‘Pin Debit’ is the transaction that takes place after input of the ATM pin and it clears through the account immediately. Debit cards provide easy record keeping, are widely accepted, incur no interest charges with the money coming directly from your checking account. While these are some great benefits, the drawbacks include the possibility of lack of access to your account during fraud or error investigations, offer comparatively less protection than credit cards with the added possibility of high overdraft fees should you overdraw your account.

The decision to choose cash, debit or credit or a combination of either is based entirely on your needs, lifestyle, and habits. Careful consideration of benefits and detriments should be done to make the choice that is exactly right payment methods for you.


About the author

Willie DeJarnette

Just wanted to provide some basic knowledge of credit cards, credit score, and other credit types financial resources. Always trying to provide an understanding how to use credit cards and basically staying away from financial ruins.

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