Skills Academy: When to Use Your Debit and Credit Cards

Do you know the best time to use your debit or credit card?
“Debit or credit?”
You’re probably asked this question multiple times every day, whether from a cashier or as two options to choose from at the gas pump. But do you really know the best situation to use your debit or credit cards?
At Raccoon Valley Bank, we see benefits to using both, though the appropriate time to use them is vastly different. As part of today’s Skills Academy post, let’s take a look at some of these benefits to identify the best times to use your debit card and your credit card.
Debit Cards
Your Raccoon Valley Bank debit card is linked to your personal checking account, meaning it is the most immediate path to cash for you. Here’s a few things to use your debit card for:

  • Exercising control over your spending- since your debit card is linked to your checking account, monitoring your spending is easy. You can either review your monthly statements, or if you are an Online Banking user, you can track your spending by logging into your account and looking at your eStatements or transaction history.
  • Quick access to cash– in a pinch and need some cash? Your debit card can get you the cash you need at an ATM or by selecting the cash back option in the checkout line at certain retailers. Just don’t get carried away; only take out the amount of cash you need.
  • No interest charges- when you use your debit card, the cost of what your purchasing comes directly out of your checking account at the moment of purchase. That way you don’t have to worry about not making a payment and the high interest charges that come with that.

Credit Cards
Credit cards often get a bad rap because so many people use them irresponsibly. However, when used correctly, your Raccoon Valley Bank credit card can be a great financial tool. You should use it for:

  • Establishing a credit history- in order to get a better credit score – and therefore better interest rates on loans, mortgages, other credit cards – you need to show lenders you can manage debt. By using a credit card and paying the balance on time every month you are demonstrating your responsibility.
  • Online shopping- not only can you use your credit card to shop online, but many credit cards come with online payment protection. This gives you the flexibility to ask your credit card provider to withhold payment if you don’t receive a package on time or if it is damaged.
  • Score points- who doesn’t love points? You can use them for all sorts of rewards, but don’t get carried away. Using your card to gain points without paying your balance doesn’t do you any good.

So, the next time you are faced with a debit or credit situation, remember the above benefits of each. Feel free to get in touch with Raccoon Valley Bank today for more information about the debit and credit cards we offer.

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