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Credit Card features vs. Debit Card features

Credit card features

  • Buy now, pay later.
  • Widely accepted substitute for cash and checkbook.
  • Interest-free loan if balance is paid during grace period.
  • Positive, timely repayment history is evidence of creditworthiness, and strengthens your credit rating.
  • Ability to stop payment if merchandise is unsatisfactory or lost.
  • Liability if card is lost or stolen: 
    • Zero, if you call and cancel card before the thief uses it.
    • Maximum of $50 per card, if you call and cancel card after thief uses it. 

Debit card features

  • Buy now, pay now.
  • Money is deducted from your account immediately, unlike most checks.
  • No interest charges.
  • Allows cash withdrawals from an ATM.
  • Only late payments, not timely ones, show up on your credit report.
  • Overdraft protection may be available for a fee.
  • Liability if card is lost or stolen: 
    •   Zero, for most signature-based MasterCard and Visa transactions—as long as you haven’t been careless and lost your card several times already.
    •   Maximum of $50 per card, if you report loss/theft within two business days.
    •   Maximum of $500 if you report loss/theft after two business days.
    •   Unlimited liability, if you wait until after 60 days of receiving your statement!

IMPORTANT: Keep phone numbers to report loss/theft in a safe place—but not in your wallet!

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