Consider yourself in good company if you wonder what are the best situations to use a credit card in lieu of a debit card. Daily Finance identifies several instances that you should always choose credit:
- Online purchases: Credit card fraud is easier to fix than if someone drains your bank account with your debit card.
- Gasoline and Hotels: Purchasing gas with debit card can lead to short-term hold of $50 to $200 (hotels) so if your balances are low this can lead to overdraft charges.
- Large purchases: credit cards provide purchase protection if item is defective and also the opportunity to stop payment
- Dubious places: if a retail establishment looks sketchy (and you still need to make a purchase there), it is easier to deal with fraudulent credit card transactions vs. debit card transactions.
So, why use a debit card at all? Well, if you can’t control your spending then a credit card can become a weapon of mass consumption.
Check out the NGPF lesson on Picking a Payment Method.