We’ve talked about credit cards in New Credit Card Laws go into Effect August, 2009, and Your Credit Card is Canceled.
But we haven’t talked about Debit Cards. Do you use one? Do you know the danger if you do?
For example, if you use the card and don’t have enough money in your checking account to cover the charge, you can be fined up to $39 every single time you exceed your balance.
May not sound like much but, if you’re out shopping and charge 5 or more times, it adds up!
And, many banks don’t debit your account in transactional order. What I mean is, you could have $400 in your account and make several $20 purchases. Later in the day, if you charge $350, you’re over for the day. You would think that the three $20 purchases would not incur a fine, but, if the bank takes out your last charge first, you’ll pay a fee for every purchase made that day.
As you may have guessed, many banks do just that. Instead of debiting your account in the order you charged, they wait until the end of the day and debit your account beginning with the largest purchase first. Why is it worth their while to do that?
If you have a problem with a product or delivery when using a regular credit card, laws are in place to protect you and you can dispute the charge. There are no such protections with debit cards.
Overseas charges incur additional fees so, if you’re ordering on-line, be aware of where you’re order ships from.
It’s ok to use a debit card, just be aware and use them responsibly. Don’t get caught with a law you didn’t know about. Ask your bank if they debit your account in transactional order. Ask if they charge fees for overseas purchases. And, always keep enough cash in your account to cover your purchases.
Debit cards, do you use them?