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You may be considering getting some type of card for the first time, and are not sure what the difference really is between a debit card and a credit card. Here is a simple, although not all-inclusive, explanation.
* A credit card allows you to charge purchases. In essence, you are delaying payment when you use a credit card. Instead, you make a payment each month. Depending on the type of credit card you have, you may be able to make minimum payments or you may be expected to pay the full amount at the end of each payment cycle, thus starting the next one with a zero balance.
* When you use a debit card, the money is withdrawn from your bank account at that specific time. Essentially, it is just like using cash; you’re making the payment right then.
For this reason, you should make sure the money is in your account before using the card, especially now that certain changes have been made which include setting limits on overdraft fees. Because of this, banks or financial institutes that once may have allowed you to use a debit card when there was not enough money in the bank may no longer do that.