Debit Cards... A Financial Nightmare!

What is flat like a pancake, gives you the freedom to have your wildest dreams and steals from you at the same time? A evil magic lamp you say? That might be a good name for it ... but most of us call it a debit card.

With the invention of the plastic money and credit cards ... the debit card has become the method of choice for spending money these days. In fact Canadians (Kelowna residents are no different) rank as one of the worlds biggest users of debit cards.

The reason most of use our debit card before we use our credit card is simple ... we are spending our own money... nothing is being added to our credit card balance with a no chance of paying interest. Since I am a big fan of eliminating of debt, the debit card seems a natural choice.

It may surprise you to find out in the US and in the UK fees being paid by debit card users are far worse than the interest charges paid to credit card holders. This is due something most us have as part of our bank accounts called an overdraft.

Check out this excerpt below from Frontline from PBS. (Click below to watch the full video ... just make sure you are sitting down when you do)

Of course the best way to beat high fees is to use cancel your overdraft and use cash. You can never overdraw your wallet, you have better control of what you spend and you actually will spend less. The closer you are to your money ... the better!

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Financial Blog of Mike Hassard | Life Insurance Debt Investing Mutual Funds |

4 Response to "Debit Cards... A Financial Nightmare!"

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r4 ds karte Says....

I am loving plastic money. There are more facility providing by Banking sector. I have still fear of hackers. So I very low using internet banking with this card.

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jon Says....

"Create market movement, and in the confusion that follows, somewhere, someone will make a mistake and lose their money." A well versed proverb of the financial industry. Credit cards are just the modern way of bilking the masses.
They give an artificial sense of affordability and even abstainers have to compete with those accessing credit indirectly all around us, in order to make money and to afford the things we all need and consider basics.

It used to be much harder to get a credit card until the convenience of plastic was granted more easily with debit cards. Simply because financial institutions discovered that more good debt than bad debt returns on increased lending.

If we all wise up to the credit card schemes, and it looks like there's an awful squeak out there right now, then the banks will be sniffing around the debit cards for more gains. And, it is already happening.

People need to stop idolizing the rich for one thing. Money doesn't come from nowhere, it comes from other people usually. Someone has to lose it for someone to win it. Is it a wonder we have crime then as a response (grow ops, drug dealings, gangs, etc). If someone earns their wealth over a "long period of time" they usually have done most to generate it. But large short term gains are really just thieves in action. One way or another, simple crime or complex crime, it is still stealing.

Bankers are no better than horse thieves. And should be reputed as such. Stop glorifying the rich!!!

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Anonymous Says....

what about loading your unused credit card with your cash and use it for car rentals and the like. That way the down side of the debit card is erased... and all your activity of your credit card is protected.... is this done?

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Anonymous Says....

Like anything else, you have to shop around for a good debit program in the US.

I am a Canadian on a work assignment to the US. As a Canadian, I lived and died by my debit card, which is useless here. So, I shopped around and found a bank that does not charge for transactions.

Furthermore, sometimes my card is a pin-based debit card, and sometimes it acts like a signature credit card, backed by Visa, which debits my account instead of running up my balance. I have used it for 3 years now, and not a hitch anywhere. And, not a cent in fees. AND. no interest or monthly balance to pay off.

This way, 1 card does it all for me,shop around.

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