Debit cards are cards linked to a pool of available funds—like money in your checking account or a balance that you've loaded onto a prepaid card—and they allow you to make purchases without needing to carry around cash or checks. These cards are useful because, unlike credit cards, they only allow you to spend money that you have. In addition, they make spending easy, as you can just swipe to pay, and you've got an electronic record of every transaction to help you track your spending. If you need a debit card, there are several approaches you can take.
Bank Debit Cards
Bank debit cards are traditional debit cards, and getting one is typically as easy as opening a checking account and letting the bank know that you want a debit card during the account-opening process. In most cases, you'll get one regardless. Your debit card is linked to funds in your account, so you can only spend as much as you have. Trying to spend more will result in your card getting declined, or the bank may "lend" you the money or transfer it from a linked savings account. However, that can get expensive if you pay overdraft fees each time.
Debit cards typically arrive by mail because they must be printed and customized with your account information, but some banks and credit unions have card printers on-site. Once you get your debit card and activate it, you can use it as you see fit—including to get cash from ATMs. If you withdraw from an ATM that's not owned by the bank that issued your debit card, you may have to pay additional fees.
Prepaid Debit Cards
You don't necessarily need to get a debit card from a bank. Prepaid debit cards are available and they draw from the money that you have loaded onto the card instead of drawing from your bank account. Some cards can be reloaded, while others only allow you to spend the card's stored value once, and then you're done.
Prepaid debit cards are increasingly becoming an alternative for people who can't or won't get a bank account, and they can be bought online or at retail outlets. While they can replace some banking functions, they are notorious for high fees, so it's important to research all of the cards available and pick one that you can use without paying too much.
Online Debit Cards
Prepaid debit cards can be purchased online, as numerous websites offer cards of varying value and with a variety of features. In most cases, these cards require that you provide personal information—such as a Social Security number, valid mailing address, and other details—so that your identity can be verified. You can often reload these cards by transferring money from your bank account, depositing cash at specific locations, or having your pay directly deposited to the card.
Companies, such as Chime, are beginning to offer online alternatives to traditional prepaid cards and bank accounts. Chime offers a spending account that functions much like a checking account, except it doesn't come with paper checks. There is no monthly fee, and ATM withdrawals are free within the Visa Plus Alliance and MoneyPass networks.
Store Debit Cards
You can also get prepaid debit cards at convenience stores, grocery stores, and superstores if you don't want to order online. Cards from stores might not require you to provide personal information, so they work well as gifts and prizes because the person who will ultimately use the card does not need to be present when it's purchased. They are also good for situations where you want to remain anonymous to avoid identity theft, stolen card numbers, or your bank knowing when and where you spend money.
Debit cards from stores often have lower spending limits, so unless you get a debit card that is connected with your bank account or funded by direct deposit, you might not be able to spend with these cards for very long.
Debit Cards for Teens
If you're a teenager (or your child is), debit cards from stores are the easiest cards to get, but they may not be your best option considering the high fees involved. You can also get a traditional card from a bank or credit union, as some banks issue debit cards to teenagers as long as there is an adult co-owner on the checking account.
The Wells Fargo Teen Checking account allows teens to start using a checking account as early as age 13, and it can be opened with an initial deposit of only $25. There is no monthly service fee on the account, so it's a good way for teenagers to build solid money habits.
Capital One offers an online-only teenager checking account called MONEY that is fee-free with no minimum deposit required. While there is no brick-and-mortar component with MONEY, the Capital One mobile app provides tools and resources to assist teenagers with their money management skills.
Rewards Debit Cards
Debit cards that offer rewards for spending are uncommon, but they do exist. It is less profitable for banks when you pay with a debit card, and as a result, they can't offer the same rewards they can offer when you pay with a credit card. If you want the best rewards out there, you'll have to use a credit card.
However, there are still plenty of debit cards available that offer rewards—the question is whether or not you want what they offer. Straight cash back is uncommon, but discount credits, games, and points that you can redeem for other items are increasingly becoming options. Financial company Square now offers a debit card to complement its Cash App. This card offers "boosts" that can be activated on the card to provide discounts at certain stores. Check with retailers where you regularly shop to see if they offer a card that will save you money.