What is a Debit Card?

Only a few years ago, the ATM card was the norm.  Slowly but surely, the ATM card has been fazed out and replaced by the debit card.  A debit card is similar to an ATM card in that it is linked directly to your checking account.  You can use it in an ATM to withdraw money as you always did with your ATM card.  This is where the similarities end, however.

Debit Card Replaces Your Checkbook

A debit card has an added function; it can be used in place of checks when making purchases.  The results are the same but instead of the hassle of carrying a checkbook and writing checks, you just swipe your card when you pay for something.  Often, your bank will be backed by a credit card company which will allow you to use your debit card wherever that company's card is accepted.  In this way, a debit card combines the functionality of an ATM card with the convenience of a credit card.

Why You Want a Debit Card

It is the fact that the debit card can be used in the same places as a credit card that makes it so desirable.  With a debit card available, you will be less tempted to place purchases on the credit card and thereby avoiding debt.  However, you must be sure to track your purchases carefully.  It is easy to swipe the card and forget that it is taking money directly from your account.  The last thing you want to do is become overdrawn.  You can use personal finance software to keep track of your purchases and ensure that this does not happen to you.