How Debit Cards Work and How Not to Lose Money
Posted on Dec 15, 2025
Top 5 Things to Know Before Using Your First Debit Card
Getting your first debit card is a big step toward independence. It means fewer cash exchanges, faster payments, and the ability to pay for things on your own. It also means responsibility, because debit cards use real money in real time.
A debit card is not pretend money. It is not a practice version. Every purchase pulls directly from your checking account. When you understand how that works, a debit card becomes a powerful tool. When you do not, it can lead to overdrafts, stress, and confusion.
Here are the top five things every teen should know before using a debit card.
1. A Debit Card Spends Money You Already Have
A debit card is linked directly to your checking account. When you use it, the money comes out of your balance right away or shortly after.
That means:
• There is no borrowing
• There is no bill later
• Your balance always matters
If your account has $35 and you try to spend $40, one of two things usually happens. The purchase is declined, or the account goes negative depending on how the account is set up.
Real-life example:
You buy food for $22. Later that day, a $15 subscription posts to your account. Now your balance is negative, even though you did not feel like you overspent.
The habit to build early is checking your balance before you spend, especially if you have subscriptions or automatic payments.
2. Small Purchases Add Up Faster Than You Think
Debit cards make spending feel easy. Tap your phone, swipe your card, and move on. But small purchases can drain an account quickly.
Things that often surprise teens:
- Food delivery fees and tips
- In-app purchases
- Online shopping add-ons
- Streaming subscriptions
Each one feels small on its own. Together, they can wipe out an account.
What helps:
- Watching your transaction history
- Keeping a small buffer in your account
- Turning on balance alerts
Seeing where your money goes makes it easier to stay in control.
3. Overdrafts Are Not Extra Money
An overdraft happens when you spend more than what is in your account. Some accounts decline transactions automatically. Others allow the transaction and bring the balance negative.
Either way, overdrafts are not something you want to rely on. They can lead to fees and make it harder to understand where your money went.
The best way to avoid overdrafts is awareness:
- Know your balance
- Pay attention to pending charges
- Remember subscriptions and automatic payments
Learning how overdrafts work now helps you avoid bigger problems later.
4. Mobile Wallets Add Convenience and Security
Using your debit card through Apple Pay or Google Pay can actually be safer than using the physical card.
Mobile wallets:
- Do not share your card number with stores
- Require phone authentication
- Allow you to disable access if your phone is lost
If you are going to use your debit card regularly, adding it to a mobile wallet is a smart move. It keeps your information more protected while still being fast and convenient.
5. Peer-to-Peer Payments Move Fast and Rarely Reverse
Apps like Venmo, Cash App, and PayPal make it easy to send money to friends. They are great for splitting food, paying someone back, or sharing expenses.
They also move money instantly, which means mistakes are hard to fix.
Important rules to follow:
- Only send money to people you know personally
- Double-check usernames before sending
- Never send money because someone pressures you
- Avoid keeping large balances in payment apps
Think of peer-to-peer payments like cash. Once it is sent, it usually cannot be taken back.
Building Confidence With the Right Tools
Using a debit card is not about being perfect. It is about learning how money works in real life.
Tools like alerts, spending limits, and mobile access help you
- Catch mistakes early
- Learn from small decisions
- Build confidence without major risk
Notre Dame Federal Credit Union youth accounts are designed to support teens as they learn to manage money, use debit cards responsibly, and develop habits that last.
Quick Recap: The Top 5 Things to Know
- Debit cards spend money you already have
- Small purchases add up fast
- Overdrafts are not free money
- Mobile wallets add security
- Peer-to-peer payments should be used carefully