It’s obviously difficult to exercise discipline over our spending habits. Debit cards are considered as a better solution than credit cards and they allow us to adopt a more responsible way of handing money. They help us to easily access our own money and banks would require only small or no fees for each transactions. However, we should know that debit cards could actually be an expensive method of using money, even more than the often vilified credit cards. Banks encourage the use of debit cards and on each street corner, we may find merchants who are able to accept debit cards. The issuance of debit cards is purely backed by economical motivations and consumes are always be the loses. We shouldn’t mistake the ease of use as a complete comfort. While banks don’t obtain interest from debit cards, they are still able to obtain fees. One way banks obtain income from debit cards is through overdraft fees. We should know that in some countries, convenience and overdraft fees are not fully regulated. They may even be able to charge us $1 for a $1 overdraft. Banks always apply overdraft when allowing consumers to use debit cards. They ding consumers overdraft fees for any kind of transaction. This applies for both a $5 latte in Starbucks to monthly fees of Netflix. In some cases, overdraft fees can be so expensive that it’s better to work with local loan sharks.
Bank will do anything they can to maximize income through the use of fees. Things can be complicated to understand and it’s important to ask the bank representatives on how fees are processed. We should think how fees work with our debit cards. We should know that it’s quite possible for banks to hit us with different overdraft fees for each transaction. In this case, we should make sure that we have a proper overdraft protection. We should convince the bank to stop implementing the use of overdrafts. Unfortunately, some banks may refuse to do that for us. It’s obvious that overdrafts fees are very profitable for banks and they don’t want to terminate their source of income. At least, it is important that we are able to freely check the amount of money in our savings account. With all the problems, it’s probably better that we stick with our ATM cards. It could be a bit troublesome to look for the nearest ATM, but the amount of fees will be minimal and we would be able to limit financial losses through fees and charges. The more we use debits cards, the more likely we will be ripped up. We should do ourselves a favor and avoid losing money. We should go to the nearest ATM regularly, as an example once a week to get a predetermined amount of money for our weekly usages. However, we should know that this method could work well only if we have a proper budgeting system. It allows us to know how much money that we will need in one week. Without a good budgeting, things will be much more difficult manage.