Credit Card v. Debit Card

Should you try to open a credit card or a debit card for use in the United States? Both are great options for making purchases without having to lug around all the cash you plan on using that day. Besides being more convenient, both of these options are safer than carrying physical money around with you in any American city. If your debit or credit card is stolen or lost, you can contact your financial institution to put a block on the card, and many will help you recover any damages in case your card is lost or stolen.

Debit cards are likely going to be the best option for English language students. To further explain, debit cards are tied to a checking account. To use the debit card, you must open a bank account and deposit funds that will be automatically deducted when you make a purchase. Be sure that there are sufficient funds available for each purchase so that you do not overdraft. Debit cards also work in Automated Teller Machines (also known as ATM) which allow you to withdrawing cash. Debit cards may allow you to overdraft your account, in other words spend more money than you have available on your account. This is normally a very costly proposition. Average fees for overdrafts run $35 dollars per transaction, and some banks do not notify you if your account has become overdrawn before assessing such fees.

Should you try to use a credit card to avoid this? If you’re like most English language students, a credit card may not even be an option for you. To be awarded a credit card in the United States, you must have a credit score, which is a record of how well you handle money that you have borrowed. This is tied to your social security number, which is a number that may not be issued. Often, English language students must start with what is called a “secured card,” which is a credit card that you make a deposit towards to ensure your good payment history.