The downside of debit cards
Rising rates and soaring credit-card fees mean many are switching to debit cards. But there are risks to using debit cards as well.
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NEW YORK (CNN) -- Out: credit cards. In: debit cards. As more and more Americans shun traditional credit cards, they're turning to debit cards. But you should know there are downsides to debit cards too.
1. Security
This can be a big issue -- You know that if your credit card is stolen, you're not responsible for unauthorized charges over $50. But if your debit-card number is stolen, you have fewer protections. First off, you have to report any misuse within two days to get the same $50 limited liability. If you miss that deadline but you report the loss or misuse within two months, you could be on the hook for up to $500. After 60 days, your liability is unlimited. Card issuers do have different policies though-so make sure you go through the fine print says Curtis Arnold of cardratings.com.
2. Your credit score
If you're trying to build up your credit score, you won't want to use a debit card. It will have no positive impact on your credit. Since debit cards pull directly from your bank account -- there is no credit, so there's nothing that can help your score if you pay your bills on time. BUT that's not to say that if you overdraw on your bank account, it won't be reported. It will be reported to the credit bureaus if you do this or if you have incurred other debit card fees. And unlike credit cards, you can't dispute charges once you've paid for them.
3. Debit don'ts
You don't want to use a debit card if it's a big ticket item. bottom line is that credit cards just offer better protection. And that's going to be even more important when you purchase more expensive items. Forget online purchases with a debit card. Credit cards are much safer. And finally, don't link your debit to a large checking account because you could be at risk says Arnold.
Of course, we do want to mention some pros -- carrying a debit card is a whole lot easier than carting around a wad of cash. And since debit card transactions generally aren't reported to credit bureaus, you don't have to have a good score to qualify for a debit card.
-- CNN's Jen Haley contributed to this article.
Talkback: Are you using your debit card more and your credit card less? 
