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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