BEST OF: Why Clark Hates Debit Cards & Credit Cards in Clark Howard's Wallet
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- เผยแพร่เมื่อ 11 ม.ค. 2025
- Did you know that using debit cards can be financially dangerous? Clark explains why you should really think about following this rule. Also, there’s a market share war with credit card companies. Competition is hot. So how do you choose? Clark has updated his cards and offers a new tool to help you choose the best credit cards for your wallet.
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I have used debit cards for decades. Never had any issues. Not concerned at all.
If you use a fork to eat soup, you will naturally think the fork is worthless trash.
A debit card isn’t trash. It’s a tool that needs to be used appropriately. There’s no need to demonize the tool for operator error.
Your credit card can’t help you access the ATM to deposit $$ into a checking account - that doesn’t mean the credit card is trash. It’s just the wrong financial tool for depositing money into a checking account.
Debit cards are an especially great tool for people who don’t have the discipline required for the responsible use of credit cards.
Both debit cards and credit cards come with equal but different risks and rewards.
Debit cards -> Banking
Credit cards -> Purchases
Thank you Clark for looking out for the little guys!
When bank started issuing debt cards it was tied to your saving account to be use at bank issued ATM only; no Visa or Mastercard logo.
Some banks still offer ATM cards. 💚
I have worked in financial services for more than 20 years. Banks vary on their debit card agreements. I choose one that protects the customer. Shop banks to get the best protection. Also ask about the fraud departments processes. I have had fraud on a debit card, but have not lost any money. 6:33
I agree with you. I have had my debit card fraud many times always got my money back. Some things he saying not true
Clark, I’ve been listening to you for about 15 to 20 years. You really make a difference in our lives. I have gotten a lot of things done with your knowledge thank you sir. We love you. Continue doing what you’re doing lol
I'm 60 and have never used or had a debit card. I still use cash mostly. The good old green back.
I’m a millennial and I hold firm that CASH IS KING 👑
Debit cards are legit and fill a purpose as long as you monitor your accounts. You are not spending money you don’t have. I had a debit card stolen that was used without the PIN number. My bank immediately cancelled it out and gave me a temporary credit and investigated the fraud in depth and permanently credited me back. It works for me.
Why not use a credit card that has more protection? If you have no impulse control, then sure avoid them like the plague, but if you can prevent yourself from buying things that you can’t afford, they are superior. I don’t make a charge on my credit cards that can’t be covered by money in my checking accounts
We completely welcome differing opinions! 💚
Thanks. I had no idea about the dangers of debit.Subscribed to your channel.
I only use my debit card for paying at the grocery store or getting money from an ATM. Otherwise, I use my Sam's Club MC all the time for the cash back. I have two other credits cards that I use for small purchases now and then just to keep them active: 1. an American Airlines Aviator Red MC (with no annual fee which was grandfathered in from US Airways when they merged) that gets me free checked bags on flights. 2. MGM Rewards MC (with no annual fee) which gets me free parking and priority check in when in Las Vegas. I pay off all three cards every month as well.
I also check the balances on my debit card and all three credit cards every day. It only takes 5 minutes to do so.
Anymore, the only time that i use my debit card is when I'm going to my bank's ATM. I was always scared of credit cards, but now, it's all that i use. I only charge stuff that i would buy anyway, get the cash back, and pay it off every month!
Same
ditto
It’s a mystery to me why anyone would do other than what you do. I am same.
I’m old, and I have never paid credit card interest in my life.
@ Because the problem is, some people can’t control themselves with credit cards. They get it in their head that a credit card is free money. I heard that as of a few months ago, 1 in 4 people were still paying off debt from the previous holiday season. I’m sorry, but I couldn’t imagine going into debt to get gifts for people.
This is how you do it! 👏👏👏
If I buy something with my bank debit card on line or anywhere else which I have done a lots of times they investigate it for me n less than five days my money back on my debit card even if the company I oder stuff from didn't have a phone number for their company I'm talkn about my bank not everyone bank bcuz I don't kno how everyone else bank deal.
In the past I've had my credit union Visa debit (checking) account drained fraudulently and both times it took 10 minutes to get every dollar back, without questions or cost. 🤷🏼♂️
Count yourself lucky. It likely depends on the bank. It took me two weeks to get my money back for fraudulent charges. That’s only because I reported the same day they happened. If I would’ve waited, the bank would’ve never given me my money back
I have one debit card... connected to a high yield savings account. By using it 10x monthly, it gives me an additional yield on the first $2500. The ten uses are most often at Dollar Twenty-five Tree, haha. And I get an email notice after each use so transactions would be easy to spot if they were not made by me.
😂 @ Dollar Twenty-Five Tree.
Great strategy! You have determined that the yield (which is a known reward) is worth the risk (which is a maybe). This is how we like Clarkies to think through financial decisions. 💚
Good point, I once rented a car for a relative (big mistake) using my debit card and he kept the car longer than he was suppose to which put me in overdraft and 3900 hundred dollars in charges ! The bank threatened to close my account if I didn't pay all the 3900 in a timely manner,, if I had used a CC I could have made payments spread out over time-- no more debit cards.
Absolutely delighted Clark is still on. Was my savior in the old workshops I worked in that has AM radio super glued to the stinky Thrush Limburger show. Clark came on afterwards. A true relief.
Rush was the best, I really miss his wit and him making a fool out of liberal politicians!
TDS?
Try buying a U.S. postal money order on a credit card---Good luck---Debit only!!!!!
I use my credit cards like a debit card to get rewards but they’re from a credit union not a bank
It’s a “wait and see” show with Southwest. They’re supposed to start the “assigned seating” in the near future. We shall see what else happens.
I still love my LV reverse monogram kislux clutch! It's versatile, fits a variety of items, and is definitely a workhorse! I think seeing it everywhere (like the LV speedy) is proof that it's already a classic.
The BEST credit card is NO credit card. Most Americans are NOT credit card people, hence the $1.16T debt (and growing). I primarily use my debit card, and only use ONE credit card when I absolutely have to. Good video, just don’t 100 percent agree with your debit card position.
Credit cards used properly can be a life saver. My car broke down and $5,000 later……I am glad I had my card.
@@Luckyduck10 An emergency fund would have been better, but as long as you pay that card off without carrying over a balance and incurring a finance charge, all good! Sorry to hear about your car.
For someone with no self control I agree with you. If you have enough self control not to purchase something that you can’t pay for then a credit card is far superior. You don’t have to agree this is just fact. With a debit card, you don’t have the same level of protection
@@Luckyduck10 People don't have emergency fund anymore?
A quarter of all U.S. households are living paycheck to paycheck.
Another great video Clark! I need to keep track how much cash rewards I receive each year for using my credit cards and it got to be at least $2K. I tried using my credit card to pay my mortgage in 2001 but I was denied.
I love my PENFED Platinum Rewards Visa Signature Card, 5% for gas paid at the pump, 3% at supermarket, (including most Target snd Walmart locations), restaurants and TV, radio, cable, streaming services. I have been a member of PENFED since 1973.
I also love my Navy Federal Credit Union Cards.
By the way, I don't use debit cards.
I really think they ignored the price just for the label. No matter the quality, nothing on this planet is worth $15,000 a bag. But I spent 200 on a super treasure from kislux and I no longer blame people who buy fakes.
Ok, so currently I only use my DC to get cash at an atm and have to pay about $3 to get cash. Should I use my CC to get cash? Wouldn't that qualify as a cash advance and charge me even more?
Yes don’t do that
Maybe you live in an area that doesn’t have ATMs from your own bank
But I have never heard banks or Credit unions charging their own customers to use their own ATM
98% of the time I use my own banks ATM for free
About the only time I use another one is when I’m on vacation and my account reimburses me up to $10 a month for other bank’s ATM fees anyway
Can you still get extra cash back for a purchas at walmart on d. Card at no charge?@@g.t.richardson6311
Check out Charles Schwab Checking and Fidelity Cash Managment, both are free accounts with debit cards that reimburse all ATM fees worldwide.
No, do not use your credit card to get cash. It would be a cash advance with more than $3 in fees. But also, don't pay $3 for ATM withdrawals with the debit card either. Paying an ATM fee to access your own money is reverse bank robbery.
Like @g.t.richardson6311 says your bank's ATM should be FREE. Only use your bank's ATM or their FREE affiliates. Another FREE way to get cash is cash-back at the grocery store. Here are more ways to avoid ATM fees 💚
clark.com/personal-finance-credit/banks-banking/atm-fees-avoid/
As a follow up to a question you answered for me on Yotta, they have now filed bankruptcy with $112M of their user's money and government said even though they advertised as FDIC insured, they aren't. Any recommendations on anything we can do?
If Southwest cancelled the companion pass would you actually cancel the Southwest credit card or still keep it?
A lot of factors will probably play into that decision (i.e. annual fee, drop in credit score, different card benefits available at that time, credit history and mix needs, etc...).
You have to be very strategic when canceling a credit card because it may drop your credit score (credit utilization, average age of credit, and credit mix). We usually recommend not canceling a credit card - just discontinue using it (only use it every six months to keep the card active). However, if you're spending more on the annual fee than you are earning in rewards, it may be worth swapping it out for a different card (same credit limit for credit limit). 💚
Clark, you need to push "if you don't have it don't spend it".
Paypal Debit card gives 5% cashback for a category which is rare. “Groceries” including Costco, Walmart.
AAA Visa also pays 5% cash back on groceries including WalMart. 3% on gas and EV charging.
Okay, that's good, but not quite as good as it sounds because if you're like me, I buy groceries at Costco. Unfortunately, Costco doesn't count as "groceries."
I use my Paypal Debit card at Costco to get 5% cashback each time I use it in self checkout at Costco. Remember, You need to activate the category “groceries” on 1st of each month.
@ I use my Paypal Debit card in Costco to get 5% cashback each time I use it in self checkout at Costco. Remember, You need to activate the category “groceries” on 1st of each month.
@ Not true. I use it at Costco to get 5% cashback.
I agree that Debit cards are not the intelligent choice. When I stopped using "fake MC or Visa" Debit cards, I stopped getting bank "extra charges." I use a credit card as you suggested and pay it off every month.
Good point! 🙌
Debit cards that is backed by visa also is backed up just like a credit cards not sure what debit card isn’t backed up
What are you talking about backed up? What he saying is if there are fraudulent charges on your account and you don’t report them within two days you can be responsible for $500. This is not the same with a credit card. It’s due to the laws governing each type of card. If I’m looking at my statement on my credit card and see if fraudulent charge, I can just call the credit card company and I’m not responsible for it. If that happens to be a bank statement for my checking account/debit card, I’m SOL.
@ if the debit card has a visa logo or master card logo it has the same insurance I know I’ve had many fraudulent charges on my debit card from my bank and made the call they instantly refund money within seconds
@@anonymous-m9k9z it has nothing to do with insurance. I believe you are really confused on this. Watch the video again. He explains it a lot better than I could.
@@anonymous-m9k9z Not true. My major regional bank will fight with with me. They tie up my money and its a struggle to get my money back. I only use my credit card now because I've had so much trouble with chargebacks on my debit card. Its up to the bank and their policy.
@@anonymous-m9k9z That's incorrect. Maybe you have a lot of money in your bank and they are willing to take care of you. Clark is correct; the laws covering DC and CC are simply not the same with DC being less protected no matter whose logo is on the card. Fact.
What is your view about a digital card
We love digital wallets and recommend a "hybrid" approach when using them (digital & physical). Here's more info on Clark's digital wallet strategy 💚
clark.com/credit-cards/clark-howard-digital-wallet-strategy/
What if you just ran your debit card as credit?
You open a checking account at a bank. You want to withdraw money. You have two options. One is to go to a bank branch and the other is to use a debit card. You can walk around with a wallet full of cash but if you run out of cash you have to get more. If the bank is closed without a debit card you’ll have to wait until the bank opens.
#BonusNews - Not a frequent car renter, but Finally seeing some good car rental rates. Around $26 a day. Pretty decent. This was a weekend rate on Enterprise. #TeamClarkRocks.
Thanks for reporting! 💚 #bonusnews
I call when I get there
I’m feel the same about Debit cards but I was just in Cologne, Germany and they required a card with a pin # to buy a ticket. I don’t have a pin setup on any of my credit cards but my debit card came in handy here. Also they did cash, I had $20 Euro bills but they didn’t take any higher than $10. I use a debit card with just a few hundred dollars on it when I’m traveling internationally.
As Always great information CLARK and Thank you 👍❤️
Reward credit cards are only good if you pay the balance off in full each month. The interest rates on these cards are very high.
I live in Asia and some parts of this region require cash and don’t accept credit cards. Therefore, I only use my debit card to pull cash from my US account, but never for a primary transaction.
What part of Asia do you live in? I know China doesn’t have this problem.
@ Philippines
Watched you for years Mr Howard.. retired at 55 years of age in 2018👌
Can you tell us more about your early retirement?
This is the biggest thing I disagree with Dave Ramsey about. Clark is 100% right about debit cards. Don’t use them to buy with.
Dave Ramsay says opposite. Noe credit card at all. He uses debit cards for his business.
You can bet the banks are going to take care of Dave. Not so much you or I.
Dave Ramsey is rich!
Dave Ramsey is throwing a fit hearing this😂😂
Do you like the USAA card?
Funny! I used your calculator. And I don't own any of the cards you recommend. The ones I do give me the same benefits, but you don't list them. ? In fact one of my cards gives me more than what any of yours show. FYI No travel, I'm retired and spend more on things you don't list, i.e. OTHER. What upsets me is that merchants don't offer discount for paying in cash. If they did, I'd quit using the cards at those merchants. Because when they did, it was 5%.
There are a couple gas stations near me that charge less if you pay cash but honestly, I haven’t seen any other merchants that do that in a long time
I did make a deal with a furniture store, probably a decade ago and they knocked $100 off if I paid cash, but it surely wasn’t advertised
Have my bank debit card an only use it at the bank atm for cash also haven not paid one dime of interest on my credit cards in 45 years
Great videos! Very cool! Keep the vids coming!
Greed blinds Banksters, Clark. That's why!
I thought if the debit card had the Visa logo, that it provided some guarantee.
gurantee you'll go thru more hassle with bad transactions. smh
Nope.
Clark another very popular financial radio host says routinely we have the same protections with a debit card just as with a credit card. He never buys anything with a credit card even hotel's or air travel.😂
Dave Ramsay?
Couple of my friends discovered fraudulent charges on their debit cards and it took over a month to get their money back, both say they wish they had used a cc.
Fidelity 2% has been our go to forever. And occasionally an airline card like Southwest for the sign on bonus miles that translates to free flight's
Debit cards=no consumer protection. I will have to rethink how I use my cards now.
I wonder if Clark has any reservations (no pun intended 🙃) about flying Southwest now that they are going to cut back service in Atlanta so much?
Except for international travel Clark. I lived in Asia for 3 years and saved $1-2000 in atm fees since Fidelity refunds all fees. (of course don't keep all all your $ in that 'atm' account.
There hell bent on having a cashless society and if you use cash your a criminal and everywhere I go using 500 or more cash I get a hard time and looks and alerts it’s ridiculous
AMEX Gold Delta sky miles
Never owned a credit card in my life only use green backs I occasionally use a prepaid debit card if I have to buy something online but that's rarely
Just use an Amex charge card. You have to pay it off every month.
Dave ramsey has stated that there is the same protections on debit card and credit card.
Comment?
1:23 in the video
They don't
Yes he has explained that many times. He says that as long as you don’t use your pin that the transaction goes through the credit card clearing system and not directly through a bank like if you do a pinned transaction. This needs to be discussed some more.
@@johnkatrich2954True, but you still have to fight with the bank to get cash restored. They have little incentive to do so. Always pay with a cash back credit card and pay off the balance in full every cycle.
Dave Ramsey doesn't know what he doesn't know 😮
Critical!!!!!!!
Important if traveling internationally to check out if the cards charge you a fee to change currencies.
Clark are you being paid by the credit card companies yes debit cards could be better I’ve used a debit card for over 30 years and I haven’t had any issues my bank notifies me through my smart phone
Good question. U see clark is very sneaky he does get $ from some companies but he ever want to talk about it. How do u think he amassed $ 100 millions his networth.
I have and use both. Responsibly
If you’re active duty military,the sapphire reserve card is free
I used to watch Clark Howard all the time. Just came across this and I can’t believe how incredibly annoying he has become
Pentagon Federal Credit Union
Excellent!
If not in the military
Join a military association
(Was a one time fee say $35)
And you are eligible to be a member of the credit union.
Give ‘em a call.
I have been with them 30 years - the best!
L
Have you noticed clark always bragging about how much HE TRAVELS. His cosco membership. And hating on others like bankers. Debit cards. Etc
I know Clark is nice but I really wish he would trash Dave Ramsey on this idiocy of debit cards