Why Choosing Debit or Credit Is Like Picking Salad Dressing

What kind of dressing would you like on your salad?”

For most people, it’s a simple decision. Not for me though.

I don’t know why, but when my server asks me that question I usually tense up and act like I’ve just been asked the million-dollar question on Who Wants to be A Millionaire.

“Dressing? I really can’t decide if I want ranch or blue cheese. Well, eh, um, ah, er, uh, oh, …” I know.

Hey, I love ’em both. I mean, if you ask me, there is nothing better than fresh homemade ranch dressing drizzled over a bed of fragrant salad greens. Then again, there is nothing better than fresh blue cheese dressing drizzled over a fragrant bed of salad greens.

See my dilemma?

This particular time, my server just politely stood there, tapping a pen on her ticket book while I tried to make up my mind.

Meanwhile, on the other side of the table, I looked over at the Honeybee just in time to see her roll her big brown eyes.

Oh well, she’s used to it.

Choosing Debit or Credit: Does It Really Matter?

I’ll get back to my story in a minute, but I bet there are a lot of folks out there who get that similar deer-in-the-headlights reaction when they run their debit card through a merchant’s card machine at the checkout counter and are confronted with the dreaded “debit or credit?” question.

Don’t deny it, people. There’s nothing to be ashamed of. After all, this question is certainly a bit more complex than, say, ranch or blue cheese.

As you probably know, when you use a debit card you are asked whether you want to pay via one of two options: “credit” or “debit.”

Regardless of which option you choose, the money comes directly from the bank account tied to your debit card. Your decision of whether to pay via “credit” or “debit” simply instructs the bank regarding how you want the transaction to be processed.

If you choose “debit,” you are asked to enter a personal identification number (PIN) and the funds are then immediately removed from your bank account.

On the other hand, if you choose “credit,” the transaction is verified via your signature and the funds may not be taken from your account until the end of the day — or sometimes even later. This is because merchants often choose to process these transactions in a batch mode with other credit card transactions.

That’s it, really.

Now I know what you’re thinking. That’s great, Len, but when I’m using my debit card what’s the better choice? Credit or debit?

Well, it depends.

My Reasons for Choosing “Credit”

Merchants like to see us use the “debit” option because they get to pay a smaller fee to the banks when we enter a PIN. Even so, I almost always choose “credit” for the following reasons:

1. More consumer protection. I can take advantage of the credit card company’s liability protections and mediation process, which in my experience has been shown to be very pro-consumer.

2. Credit card rewards. More and more debit cards are offering rewards for their use, but most of the time it only applies if you select “credit.” If you enter your PIN number you can usually kiss those rewards goodbye.

3. Potentially higher transaction limits. To prevent a thief from draining your bank account too quickly, banks usually impose a daily purchase limit. However, you may be able to get around this limit in rare instances by choosing to pay via “credit.”

4. More convenience. You might be interested to know that I did a very unscientific experiment and discovered that it takes me an average of 2.1 seconds to enter my PIN, but only 1.6 seconds to sign my name. Hey, every millisecond counts, folks. That’s why anytime I can swipe my card without having to enter my PIN, I’m a happy camper.

My Only Reason for Choosing “Debit”

I can think of only one instance for selecting “debit” over “credit” and that’s when I need a little cash back with my purchase. And although it’s the only reason I ever choose to use the “debit” option, it’s a particularly good one because it allows you to avoid those irritating ATM fees. Not too shabby, huh?

Meanwhile, Back at the Restaurant…

Anyway, much to my family’s embarrassment, I continued to hem and haw over the decision to go with ranch or bleu cheese until the Honeybee finally offered me a life line. “Do you want me to choose for you, Len?” Would I ever!

Actually, I found her offer to bail me out kind of, well, romantic.

“Yes, please, Honeybee. Thank you.”

And with that, the heavy burden of choosing between blue cheese and ranch dressing was lifted off my shoulders as the Honeybee quickly ordered for me.

“He’ll have Italian.”

Photo Credit: Rool Paap

(This is an updated article that was originally published on December 20, 2010)


  1. 1

    Holly says

    Nice analogy and I agree w/you on all points, er, except…

    for me, the salad itself usually dictates the type of dressing I choose. For instance, simple garden house salad gets the house italian dressing, italian restaurant-syle w/onions gets oil and vinegar or raspberry vinaigrette, and specialty bacon-egg-spinach types get ranch or bleu. Weird, huh?

  2. 2


    So how was the Italian dressing? 😉 Is every merchant offering you the option? I guess if it costs them less for debit, they might just take it as an answer…

  3. 4


    Love this blog post. I always choose credit too. It just seems easier for the reasons you stated. As for salad dressings, you never know, totally depends on the salad…

  4. 5


    I choose credit too for the exact same reasons – most emphasis on credit card rewards and consumer protection though. Honeybee got me with her response, lol. Mr. BFS would totally do that to me so I pick quick. :-)

  5. 6


    I don’t have that problem since I don’t use debit card ever. Now the salad dressing present more of a dilemma. I usually get something I never had before or something that I haven’t had for a while. What can I say, I live life on the edge.

  6. 7


    Interesting analogy. How about if you said forget it, I’ll use no dressing since it’s healthier!

    Maybe using cold, hard, cash is the purest form of payment, similar to a salad without dressing. However, just as that salad has no taste, you get no rewards/cash back with the cash, so it’s not as fun or convenient either (who wants loose change).

    Personally, I use credit cards and just pay off the balance in full. It’s been habit, so I have continued as such. That said, I have been interested in why folks might prefer to use a debit card, so I’m curious what others will say here for their reasons for doing so. Your points were interesting in that regard as well.

  7. 9


    Hmmm….you could always ask for ranch with a side of bleu cheese!

    As for debit vs. credit, I like earning my rewards points so I almost always choose credit. The only time I don’t is if I can’t figure out how to “cancel” entering my PIN. But that happens infrequently. 😉

    However, for people who constantly overdraft, I think I’d say -stick to debit!

  8. 10


    For me there is no choice. Since I pay off my entire balance, I like the float, limited liability and frequent flier miles earned. Debit cards equal cash which reduces my personal cash flow.

  9. 11


    @Holly: When it comes to salads and accompanying dressing, you’ve really got your act together! If I could, I’d let you choose my dressing every time. :-)
    @DoNotWait: I like Italian too! Besides, it put me out of my decision “misery.” LOL I don’t think I’ve ever come across a merchant that didn’t offer both options.
    @Darwin: I hear ya. For me, it is just another option to have in my wallet — the biggest advantage I think is that it provides me with a surefire way to get a little fee-free cash when I need it. Can’t do that with a credit card — at least I can’t with mine. The finance charges and other fees start accruing immediately.
    @Jenna: You and Holly sound like two peas in a pod.
    @BIFS: Yeah, the Honeybee is a real riot. 😉
    @Retire40: For me, it’s bleu cheese, ranch, and Italian. Well, Roquefort too, but I think that’s pretty close to bleu cheese.
    @Squirrelers: A debit card is preferable to cash in that if I lose my cash, odds are I’ll never see my cash again. If I lose my card, it’s no big deal. Plus it’s pretty simple to cancel.
    @Briana: Yep.
    @LittleHouse: Ranch with a side of bleu — now that’s out of the box thinking, Jen! :-)
    @krantcents: Yep. I can’t argue with that.

  10. 12


    perhaps the script should go along the lines like this..

    folks who are overweight (aka cannot control spending) are better off choosing a “healthier salad dressing like balsamic vinegrette”…think debit card..

    For folks who are slim like the Penzos’ (those who pay their bills in full) can have their ranch dressings (use credit cards to earn rewards).

  11. 13


    My “debit” card that I use will not work unless I push the credit key. I also cannot get cash back. But it immediately withdraws from my checking account just like a debit card. Also, Len, if you lived in Oklahoma you’d know to order the Ranch dressing. Everything comes with Ranch dressing here…pizza, salad, chicken, everything.

  12. 14


    @Mr.CC: Balsamic vinegrette, eh? You’re beginning to sound like one of those Iron Chefs, Mr. Credit Card.
    @Norman: Really? Then my daughter would fit in just fine in Oklahoma! She puts ranch on everything too — including her french fries and pizza. (I’ll stop telling her she is the only person on earth that puts ranch on her pizza now.)

  13. 15


    So, I take it when asked credit or debit, you reply “check”.
    I always try to choose credit, mainly because I read somewhere that it provided more protections for the card user. I didnt know about everything else, thanks for pointing that out.

  14. 16


    Since I was of legal age I have used a credit card. It was great for consumer protection as well as rewards. I used debit a lot as a teenager. The only time I use debit now is when I am somewhere and they don’t take credit cards. Yes these places still exist.

  15. 17


    Ha ha ha, only ever balsamic and olive oil for me and likewise only ever debit too….. Ok every now and then I like mustard or honey in the dressing too :).

  16. 18

    Steven-H says

    A few ‘small’ vendors/people I buy from will ask me & I tell them “Whichever is cheaper for your business.” I feel as though I am helping the smaller business by saving them some money. They appreciate it & remember me each time I am in their business & I do get what I feel is more personalized service.
    Any of my major purchases are always made with a credit card.

    • 19


      If you’re comfortable with that, more power to you, Steven! :-)

      I’m someone who really feels more secure with the added protections that come with choosing “credit.” It’s kind of like a security blanket for me I can’t give up!

  17. 20

    David says

    I believe, Len, that your premise was that either way, you were using a DEBIT card that that the options were offered in the industry misnomers of “debit” (PIN validated) and “credit” (signature validated).

    Since, either way, the card is a DEBIT card, I can’t understand how consumer protections extended under Fair Credit Billing Act would apply to a DEBIT card, merely because you elected to sign the transaction slip vs. entering a PIN. You are not being extended credit, you are not being subsequently billed for it at the end of the month.

    In terms of efficient checkout, I second the observation that many merchants process true CREDIT card transactions without requiring a signature, so that would reduce your cited validation (signature) time to zero, in such cases. I cannot comment on merchant practices with regard to non-PIN transactions using a DEBIT card, as I virtually never make such tranwsactions.

    • 21

      Len Penzo says

      As I understand it, the protections apply when you choose CREDIT because the transactions are processed via the credit card company. When you choose DEBIT, the money is deducted directly from your bank account.

  18. 22

    David says

    A few additional comments on DEBIT card use:

    I agree, Len, with your sole reason for using a DEBIT card (with PIN validation) and that is as a subsitute for a FREE ATM when one is not available to obtain pocket cash.

    Either validation method (PIN or signature) requires you to conscienciously enter each transaction in your checkbook, lest you lose track of just how much you have available. If you are rushed and fail to do so on the spot, it can come back to “bite you” in the form of an overdraft based on an incorrect balance in your check book. In any event (PIN or signature), logging your DEBIT transaction in your check register is certainly going to add more time to your checkout transaction than a true CREDIT card which does not directly deplete your bank account.

  19. 23

    Guy says

    Everything you said is true and nice, I love getting back 1.5%-5% of my purchases back in rewards. And the protections are nice for those just-in-case times. But one of the benefits that you didn’t mention is that I’m using the credit card’s money interest free (assuming you pay it back on time every month). If I put 2k on a credit card for a vacation, I get 5% back in rewards (depending on the month I book) AND I don’t have to lose that money for up to two months allowing me to keep it in high yield savings (or even stocks) and make interest on that money. Every day that money is in my bank account I am making money on it.

  20. 24

    Jesse says

    I agree with many of the people here, however, sometimes credit can be hard to regulate for people(not you financially responsible people of course…:))

    Also, the “convenience” thing is overstated. The time it takes to wait for them to bring the paper and for you to sign it is much less than if you just entered the code in the first place.
    Minor quibble I know…
    Also realize this post was years ago probably, however the hyperlinks appear to work.

  21. 26


    Len, “Paper or Plastic?”

    I wonder if you used the debit card more… would you get better at keying in your PIN? Want to design a scientific test for PIN vs. Signature times?


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