Remember when most of your purchases were made by cash or check? And you balanced your budget using a check register? Those days seem gone to the past, which leaves us to wonder whether the switch to more convenient spending using plastic has had any effect on how we manage our money. For most of us, staying within our budget and out of debt isn’t always easy. So which of the two types of plastic is better for your finances?

Better or Worse?

The answer really is, it depends. For some of us, using a debit card is a better spending tool than credit. For those who tend to charge more than is necessary, using debit can keep you more in tune with how much you are actually spending. Like cash, a debit card is linked directly to your checking account and once the money is gone its gone. Watching your account decrease with every purchase could keep you out of the temptation to buy something you can’t actually afford. Of course, this assumes you actually do monitor your debit card purchases in your account regularly. If you don’t watch your checking account, you could overspend money on your debit card that you need for other payments or purchases.

For many, the appeal of credit cards is simply buy now, pay later. While not everyone will run into trouble using a credit card instead of a debit card linked to their checking account, credit cards do come with interest fees and can cost you more down the road for the same purchase. One thing using credit cards over debit cards can offer is a credit score contributor. Having and using credit can strengthen your credit profile, something debit cards cannot do. However, having too much credit debt can be detrimental to your credit score.

The logical answer for most people is to have and use both. Use your debit cards for everyday purchases like gas and groceries, while saving your credit card for a responsibly planned purchase. Keep daily living expense purchases away from your credit card and only use it for making a purchase you can pay off in several months.