Dealing with Debit Cards

Since 2001, Canadians have used their debit cards more often than they have used cash. About half of all Canadians say they use a debit card most of the time compared to 25% of all Canadians who use cash.

Debit cards are simple to use, extremely convenient, and they can keep us from running up credit card balances. Unlike American debit cards, Canadian debit cards do not allow us to withdraw more money than we have in our accounts. Those of us who have overdraft arrangements with the bank can withdraw money until we reach our limit. After that, Interac will refuse to complete any transactions.

But, we still need to take precautions with our cards. In his book, Fight for your Money, David Bach offers the following tips:

• Make sure all your debit transactions are handled while the card is in your line of sight.
  

• Check your bank statements online every day. Make sure all recent transactions are legitimate. Contact your bank immediately if you see anything suspicious.

• Do not make it easy to steal your password. Do not write it on the back of your debit card or carry it with you on a piece of paper. Find a password that can be remembered easily by only you.
  

• Never use your debit card at a machine with signs of physical tampering.

• Be aware of people lurking too closely at ATMs. Use your hand to shield the numbers entered on the keypad.
  

• Use your debit card only for small, immediate transactions.

• Contact your bank immediately if your debit card is lost or stolen.