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Visa Debit Card Safety: What You Need to Know

My daughter just reached an financial milestone the other week when she opened her first checking account several weeks ago. However, she’s even more excited that, along with the checking account, came a Visa debit card. Yep, her first piece of plastic.

Visa debit cardOf course she will have to learn how to use it responsibly. That’s because debit cards act like cash. All transactions post to your checking account register. In other words, when you buy an item with a debit card, the money is immediately withdrawn from your account to complete the purchase.

The advantages here should be obvious. Debit cards force you to budget your money. They force you to keep track of how much money you have left to spend. Credit cards don’t do that. The credit limit is the limitation placed on the account. But once you’ve hit that limit, many people have already spent more on the card than they actually have. That’s what makes credit cards so dangerous.

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Buyer Beware: Renting a Car With a Debit Card

My wife and I have chosen to be debt free and live without the use of credit cards. 99% of the time we have no issues when it comes to purchases. We simply swipe our debit card or pay with cash when making a transaction. The one instance where we’ve had difficulty is when we are renting a car with a debit card.

We’ve run into trouble twice with this and in both cases it nearly had us stuck. The most recent time, on our vacation to Yellowstone a few weeks ago, nearly cost us our trip.

My wife is an incredible trip planner. She can research and organize a trip with such precision I hardly have to pay attention. The most I end up doing in the trip-planning phase is giving minor advice and approval to her vacation to-do requests.

So when the chance came to save $700 on our rental car for the week that was a no-brainer. “Heck, yeah” I said. “Book that!”

My wife is member of the AICPA (the American Institute of  CPAs). As a member she is entitled to discounts with companies with whom the AICPA has an affiliation. One such company is Hertz.

She did all the fine-print reading ahead of time and found out Hertz does accept debit cards for rental car purchases. The one caveat is they require a credit check before releasing the car. That should have raised a red flag for us but we just missed it. (Our credit is of course shot because we don’t use credit anymore.)

So we booked a minivan with Hertz two months prior to leaving and didn’t give it another thought.

Renting a Car With a Debit Card: A Nightmare Scenario

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