Murphyd0
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Give an example of where you would use a credit card versus a debit card. List the pros and cons of each for this purchase you are thinking of. Describe why you would use one form of payment versus the other?

Sagot :

Boogalo665
Credit cards should be used to bigger purchases (video game consoles, rent, etc) because you do not have to have all the money right now to buy it. Smaller purchases when you have the funds are when you should use a debit card.

Answer:

Credit Cards vs. Debit Cards

Credit cards and debit cards typically look almost identical, with 16-digit card numbers, expiration dates, and magnetic strips, and EMV chips.1 Both can make it easy and convenient to make purchases in stores or online, with one key difference. Debit cards allow you to spend money by drawing on funds you have deposited at the bank. Credit cards allow you to borrow money from the card issuer up to a certain limit in order to purchase items or withdraw cash.

Explanation:

Pros of Using Credit Cards

Credit cards can offer certain advantages over debit cards, though they can also have some downsides. Here’s a closer look at the pros and cons of spending with credit cards.

  1. Build credit history
  2. Warranty and purchase protections
  3. Fraud protection

Cons of Using Credit Cards

The main drawbacks of using credit cards involve debt, credit score impacts, and cost.

  1. Spending can lead to debt
  2. Credit score impacts
  3. Interest and fees

Pros of Using Debit Cards

Debit cards can have both upsides and downsides, just like credit cards.

  1. Avoid debt
  2. Fraud protections
  3. No annual fee

Cons of Using Debit Cards

Similar to credit cards, the biggest downsides of using debit cards involve credit score impacts and cost.

  1. No rewards
  2. Won’t build credit
  3. Fees
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