Ramsey County

Making $ense of Dollars and Cents

March 23, 2009

Debit and ATM Cards: Using Them Wisely

          Recently, debit cards or check cards have become the preferred form of payment by American consumers who use plastic for in-store purchases. Debit card transactions, which make an immediate transfer of funds from an account, such as a checking or savings account, may be more convenient than carrying cash, writing a check or paying a charge bill later. 

          Most debit cards work in two basic ways. Transactions may be debited immediately by using a personal identification number (PIN), or they maybe processed within a couple of days with a signature on a receipt. Getting cash from an automated teller machine (ATM) or retail location generally requires a. PIN number.

          Transactions may be denied if the account does not have enough funds in it, particularly for employee or benefits accounts. Bank account transactions may not be denied for insufficient funds, which may trigger expensive overdraft fees or loans. Overdraft fees related to debit cards are a profitable source of revenue for banks. One less costly alternative may be to sign up for overdraft protection linked to a savings account if it is available.

          Many financial institutions offer debit cards to customers at no cost. Others may have charges tied to a certain number of transactions or locations used. For example, cardholders of benefit payment accounts may be allowed only one free ATM cash withdrawal per month. Fees may be charged for ATM withdrawals from locations outside a specific bank or account network.

          Consumers also should understand the effects of debit card "blocking." A hold may be placed on your account, blocking access to funds in your debit card account, when you check into a hotel, rent a car, host a large dinner party or buy gas,.  For example, if you check into a $100-per-night hotel for five nights, at least $500 would be blocked, and possibly an additional amount for "incidentals" such as food, beverages or damages you might cause. 

          To protect your debit card, keep the following tips in mind.

-  Make sure you know exactly what to do if your debit card is lost or stolen.

-  Keep a record of your account numbers and telephone numbers in a safe place separate from your cards to be ready to report a loss quickly.

-  Know where your card is at all times.

-  Memorize your PIN. Never keep the printed number with the card!

-  Keep your PIN a secret. Never share your number or let someone near see you key it in.

   Do not choose a PIN number that anyone could figure out, such as a birthday or phone number.

-  Be cautious about using your account number on the phone or Internet.

-  Do not give your PIN to anyone on the phone.

-  Draw a line through blank spaces on receipts above the total so the amount cannot be changed.

-  Do not sign a blank debit receipt slip.

-  Tear up carbons or duplicate copies of receipts and dispose of them carefully.

-  Cut up old cards.

-  Carry cards only when you will need them

-  Always know how much money you have available in your account.

- Know your limits. Some issuers limit daily withdrawals or purchases for your protection.

-  Record each transaction immediately and subtract it from the balance in your account register.

-  Keep receipts in one place to compare with your monthly statement and your account register records.

-  Be aware of transaction fees, when they will be charged and whether the fee varies, depending on where you use the card.

- Remember to subtract automatic preauthorized debits and add direct deposits to your account register.

-  Open monthly statements promptly and compare them with your records, balancing your account.

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524 4th Ave NE #5, 2nd Floor Ramsey County Courthouse
Devils Lake  ND  58301
701-662-7027
email - NDSU.Ramsey.Extension@ndsu.edu