You may not realize that there are several alternatives to the credit cards offered by mail and those annoying phone calls you receive right at dinner time.

Five of the alternative ways to pay for items other than credit cards are in the list below.

Debit cards are one alternative to credit cards that has been in operation for a number of years in many European countries, but are relatively new in other places. Debit cards are accepted in most of the places where credit cards are accepted, so they can be used in a similar way.

A big difference between debit cards and credit cards is that debit cards just take the money directly from your bank account and credit cards send you a bill at the end of the month. You must be made aware of the fact that you may not be as well protected against fraud with a debit card as you would with a credit card. A different name for debit cards is electronic checks.

Prepaid credit cards and regular credit cards work similarly, however, with pre-paid credit cards you are not allowed to carry any negative balances. You have to deposit money into your pre-paid credit card account before you can spend with it, this means that you ‘top-up’ this card the same way you do with pre-paid cell phones. This could be a great method of controlling spending and you might even consider giving one to your child to control their spending. Credit cards that are pre-paid can also be safer than debit cards, because if it is stolen the thieves can just spend the money that is on it.

A better way to borrow money instead of using a credit card is the use of bank overdrafts in conjunction with a credit card. When you use a bank overdraft the bank sets the limit on it, in accordance with the amount you deposit into your account each month and you do not have to pay it off until you want to pay it off. You will have the chance to let your bank account go into the red with a negative balance. A relatively high rate of interest is charged by many banks for an overdraft, although they are rarely as high as that charged by credit card companies and when the bank considers you to be one of their better customers, you may be given an even better overdraft interest rate.

Traditional Loans-these types of loans are one other alternative to credit cards. When you plan on purchasing a single big item at a fixed price - like a car or home improvements, it’s worthwhile for you to contact a bank or other type of lender to find out if they can finance your dreams. If you consult with these types of lenders they will be able to extend a loan to you at a much better rate of interest than a credit card company’s and they can help you set up a repayment plan to better fit your budget.

The last alternative to credit cards to be listed here is credit unions. Credit unions are like banks, just more local; they are co-operative, owned by their members and run by the community and are a great place to borrow money. Credit unions are a good place to borrow because there are laws that set limits on how much interest they can charge, since they don’t need to make a profit for the owners and shareholders, due to the fact that they do not have any. A credit union is one of the more solid alternatives to credit cards and well worth looking into if you need to borrow money.

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