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Sometimes looking into your wallet when it’s time to pay for a purchase is like taking a multiple answer test…which card do I want to use?

Debit cards are extremely popular because they offer the convenience of plastic without you actually having to borrow anything. Your debit card is connected to your checking account, which means that your purchase amount is deducted directly from your bank account. As a result, it does not accrue interest, since you are not building a balance. If you do not have enough money in your checking account to cover the purchase, you can be denied (unless you have opted in for overdraft protection). Most debit cards have a credit card company logo that ensures that you can use your debit card wherever credit cards are accepted. This makes it a little easier to tap your checking account, no matter where you are.

When you use plastic at some retailers, gas stations in particular, they block your card.  This means they authorize and reserve money in your account - typically $50 to $100. They don't know exactly how much you'll buy, but they want to make sure you can afford it. If you only buy $20 worth of gas, they won't release the remaining amount immediately..it can take several days. During that time, you don't get to use the blocked money until your actual purchase amount is applied.  That can cause a dilemma if you're counting on that money immediately.

So many options to consider...life used to be more simple.  It was called "we paid cash!"

Posted by Lynda Fleming, Customer Service Rep.  Integrity Mortgage & Financial Inc.