What You Must Know if You Insist on Using a Debit Card

How do you pay for stuff? Do you hand over cash? Write a check? Pay with a credit card? Or do you  use a debit card because the payment is automatically deducted from your bank account?

Credit-Card-Woman

Most people use a combination of paper, plastic and electronic payments. However, debit cards have now surpassed cash, checks and credit cards for the way people pay at the point of sale. Personally, I do not have a debit card, never have and never will. I have an ATM card.

Simply having a debit card tied to your bank account is an invitation for trouble. I would love for you to get rid of yours, but if I cannot convince you to do that, do not become complacent. Get proactive. The odds are stacked against you which means you will become a victim of fraud. Determine right now to know your risk then create every safety net you can think of, such as:

Set up an alert. Many banks offer online balance alerts that will email or send an SMS message to your cellphone when your balance drops below an amount that you determine. I would strongly advise you to set up balance alerts and don’t set them too low. Receiving an unexpected low balance alert could be an early warning sign that someone is cleaning out your account and may allow you to stop it before they do.

Have a “Plan B.” When it happens, you will be under a lot of stress, so don’t expect to have a clear head. Have a plan in place so when you discover your debit card is stolen or you get an alert that your bank account is low and dropping fast, you’ll instinctively know what to do.  

You will most likely be faced with one of two scenarios:

1) A thief cleaned out your account or

2) The bank needs to block your debit card and your entire account until they can change your account number and issue a new debit card.

In both of these situations, you will not have access to your money. Get prepared with funds in a different bank or some place that only you know about. 

If you enjoy the convenience of paying for your everyday purchases with plastic, consider opening a no annual fee credit card account with a small line of credit for those purchases. Be sure to promptly pay off your bill in full each month to avoid any fees and interest charges. Can’t trust yourself to do that? Then pay with cash.

If you insist on using a debit card and if you are the victim of a thief cleaning out your account, the bank will probably require that you file a police report. Don’t be surprised if they look at you a little funny, wondering if perhaps you’re the one who emptied the account and now you’re trying to pass it off as a theft. You may have to defend yourself.

Good luck. You’re going to need it. 

So let me know–what’s your preferred payment method? Has your debit card been compromised? How did that work out? Am I missing something here by not having a debit card? I don’t think so, but I’d be interested in your comment below. I read all of the comments.

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