Credit and debit cards are physically very similar. Both have the same format, most are made of plastic, and all contain a 16-digit number, expiration date, and security code. In terms of payment, both are accepted at almost every establishment globally, and your transactions are approved (or denied) almost instantly. But they have quite different functions.

Some people argue that the debit card is a “financially healthier” choice because it’s similar to paying in cash. However, I believe that using a credit card in all situations is always more advantageous than paying with a debit card. In this article, I will list three reasons why you should stop using debit card. Check it out!

1. Accumulation of points or miles

The first reason could be none other than accumulating points or miles. Most credit cards offer loyalty programs to encourage the use of the product. The number of points can vary widely from 1x to 2x points per dollar. For example, The Amex Aeroplan credit card. As an American Express Aeroplan Cardmember, you can often book flight rewards for even fewer points with preferred pricing. When you pay in debit card, you will not be accumulating points or miles that can be transformed into airline tickets, products, or other services that you could have at no additional cost.

2. Cashback

Suppose you find it difficult to accumulate and redeem points or miles or prefer to have the freedom to use your rewards as you prefer. In that case, there are also cards with cashback like the SimplyCash Preferred Card from American Express. This card refund a percentage of your expenses in the form of a credit on your bill or checking account. For example, the new SimplyCash™ Preferred Card from American Express Cardmembers can earn 10% cashback on all eligible purchases (up to $400 cashback) for the first four months of Cardmembership. After that, you earn 2.0% cashback when your Welcome Rate ends.

3. Improved credit score

The credit card, as a form of loan, helps build your credit score. As you use the card and make payments, the bank will send data on your financial behavior to credit protection companies and your score built. Having a good credit score can be very helpful when applying for a vehicle or home loan or getting approved for better credit cards.

Debit cards, as they do not involve “risk” to the issuer, do not contribute to your score like credit cards.

In conclusion

Choosing always to use your credit card as a form of payment is an intelligent choice as long as you use it responsibly. Also, always pay the total amount of the bill by the due date. Otherwise, you may accumulate high-interest debt that will not offset any of the benefits presented.

While using a debit card or cash will not stop you from overspending your budget, it is undoubtedly a “lower risk of damage” option. If you’re afraid of buying more than you can afford, make it a habit to track your expenses through the bank app and create a spreadsheet to manage your expenses throughout the month. Create categories like new clothes, shoes, clubs, and parties, etc.. And set monthly limits on how much you can spend on each one without breaking your budget.