SHC Pine Press July 2021 | 8 could have on all of us at least twice over in that time. If you’re still concerned or unsure, please feel welcome to contact me about it, either at president@spartan.coop or by swinging by the SHC Office. Currently, every house has at least one member who can vouch that I love talking about all of this with people — it’s truly my pleasure.
Crash Course in Credit Cards By Leah Rogers, Corporate Treasurer, Vesta What is the difference between a credit card and a debit card? Credit and debit cards look very similar, with their card numbers, expiration dates, and magnetic strips. Most of us probably have at least one credit card and one debit card in our wallets. The main differences between credit and debit cards involve the accounts that they are linked to and the amount of buyer protection that they offer. A debit card links directly to a cardholder’s checking account at a bank while a credit card is linked to a set line of credit extended to a cardholder by a bank or credit card company. Understanding the difference between credit and debit cards can help you, as a purchaser, protect yourself from fraud, build a credit score, and even earn rewards on purchases. What are the benefits of using a credit card vs a debit card? First, let’s talk about fraud protection. Fraud happens when someone makes unauthorized purchases using a stolen card or card number. In most cases, a credit card will offer much greater fraud protection than a debit card. In the event that your credit card is used fraudulently, as the cardholder, you would only potentially be liable for up to $50 in charges. Often, there is no cost at all. In the event of debit card fraud, on the other hand, the cardholder is responsible for reporting a lost or stolen card within 48 hours, otherwise their liability will rise to $500. If the cardholder does not report a lost or stolen debit card within 60 days, there is no limit to their liability cost. Credit cards can also help you build your credit history. There are both positive and negative aspects of credit history, which are based on a cardholder’s usage. On-time payments and low credit utilization ratios are both aspects of positive credit history. Late payments and delinquent accounts will contribute to negative credit history. Credit history information is used to calculate an individual’s credit score. Your credit score can impact things like the interest rates you will be offered on loans as well as rental opportunities. Many credit card companies will offer free credit score monitoring as a perk for being a cardholder. Many credit cards will also offer cardholders incentives for using their card, known as rewards. Rewards will often be in the form of cash back on purchases, travel points, or the option to exchange points for gift cards to certain retailers. Some rewards cards will even allow you to select a category to earn more rewards in, such as travel, grocery, or dining. If you select a rewards category where you are likely to do the most spending, you can accumulate points even faster. Rewards are a nice perk for using a card, but it is not
