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Are you in love with your credit card rewards, but not the bill at the end of the month when all your purchases rack up?
Credit card debt is serious business, reaching about $905 billion in 2017. It’s easier said than done to always use credit responsibly, which is why companies like Debitize help consumers do just that with tools that guide them in the right direction.
In fact, the CEO of Debitize is Liran Armstrong, a previous employee of J.P. Morgan, who wanted to help people learn to use their credit in the best ways possible to avoid debt and improve their scores.
This is where Debitize comes in. This handy program helps you pay off your credit card balances by treating your credit cards like debit cards, for a set-it-and-forget-it financial strategy.
Let’s get into the details of this helpful program, like who might find it helpful and what features can optimize your credit.
What is Debitize?
Debitize is a service that syncs with your credit cards and turns them into debit cards. Not literally, but figuratively.
Where credit card purchases are ones that you don’t have to have the funds available for right away, debit cards require available funds in your linked checking account to cover your purchases.
The problem with credit cards is that, if you don’t pay off your monthly balance when the bill comes, and you continue to use your card, your balance will keep growing. That means your interest will, too.
Debit cards take the money right from your account, which helps ensure that you don’t spend beyond your means.
When you use Debitize, your credit cards will act like debit cards, with any purchase you make using a credit card causing the money to come directly out of your linked bank account.
How Does Debitize Work?
When you create your account, you can link your credit cards and desired bank account from which Debitize will deduct funds to cover your purchases.
Basically, every purchase you make with a linked credit card will go through Debitize, which will automatically transfer the funds from your bank account in the amount of the purchase.
Debitize then holds these funds in your Debitize account until your credit card payment is due. At that time, Debitize uses the held funds to pay your bill, automating the entire process for you.
You’ll never have to worry about a missed payment or carrying a balance on your credit cards. You just have to remember to use your linked credit cards instead of your debit card.
What are the Benefits of Credit Cards Over Debit Cards?
Why, exactly, would you want to use credit cards instead of debit cards for purchases?
Credit cards get a negative reputation because it’s so easy to use them irresponsibly. But, if you know how to use them correctly, you can get everything from cash back on purchases to free airfare.
If you have credit cards with rewards, you can only benefit from the rewards if you use your cards. Debitize can help you maximize your rewards without spending more than you can afford to pay off every month.
Credit card usage, when done correctly, can also help you raise your credit score and improve your credit report. You’ll need credit to finance a car, buy a house, and even get a good rate on your home or auto insurance.
If you get into the habit of making purchases and paying them off every month, which Debitize does for you, you can gradually raise your credit score and get on the path to good credit health.
Who is Debitize Best For?
Debitize is best for people who get the urge to overspend using their credit cards. The service can help you get into the habit of only spending what you have available and paying off your balances every month.
Essentially, it teaches you money management and better spending habits.
Also, this system will likely only benefit you if you have credit cards with good rewards.
Cash back, bonus points, and travel miles are all things that can help you save money down the road, but credit cards without rewards won’t really save you any money over using your debit card.
Who Might Want to Avoid Debitize?
If you already pay off your credit card balances monthly, there’s probably no need for you to use Debitize unless you think it might help you stay on track.
And, if you’re a person who already has thousands of dollars of debt accrued on credit cards, you should stick to getting them paid off before adding any more purchases to them.
Debitize only pays for what you currently put on your credit cards, so it won’t help you with previous balances.
Pros and Cons of Debitize
Debitize can be extremely helpful to people who want to maximize the use of their credit cards and tweak their spending habits. But, that doesn’t mean its without its flaws.
Here are some of the most important benefits and drawbacks to using this service that you should consider before you sign up:
Pros of Debitize:
- Helps you keep your helpful credit card rewards without blowing your budget.
- Automated process makes it simple for you to stop spending outside of your means and ensure that you always have your purchases covered.
- The system and process teach you important money management skills.
- Helps optimize your credit by making you spend your money wisely to build credit.
- Pays for all your purchases at the end of the month automatically so that you don’t carry a credit card balance.
- 256-bit encryption, the same as what banks and other financial institutions use, to keep your information safe.
- Doesn’t store any of your banking credentials once your accounts are linked to the system.
Cons of Debitize:
- Debitize doesn’t help you pay off your current balances unless you make it do so; if not, it will only new purchases that you place on your cards. You’ll need a little willpower to set it to automatically make payments on your current balances, too.
- Although rare, there the system could occasionally have a hiccup that causes a late payment on your credit card.
- You may still have a larger purchase than you can afford if you have the funds available on your credit card. Your purchase won’t get rejected just because you don’t have enough funds in your bank account.
What Do Debitize Reviews Say About It?
I like to check around the web for reviews of anything I review, whether I enjoy the app, website, program, etc., or not.
It gives me a good idea of what others think, which is helpful for me if I missed an important feature that could have solved a problem of mine.
It also helps me see what negative features I may not have come across yet so that I can be prepared in the future if I continue using it.
Especially when it comes to money, it’s important to know what you’re getting yourself into. You’ll want to know that your information is safe, secure, and handled how it should be.
Debitize works directly with your bank account and credit card accounts, which can make a lot of people expectedly nervous.
Fortunately, through my research of Debitize and the time I’ve spent using it, I can confidently say that security isn’t something you should worry about.
Plenty of online reviews rave about the security features of Debitize. I personally love that it deletes all bank and credit card information once your accounts are linked, so you don’t even have to wonder if hackers can get to your sensitive info.
Debitize is still a relatively new service and has continuously worked on rolling out new features in 2017 and focusing on doing so for 2018, so you won’t find reviews on Consumer Reports or the BBB yet until it has some longevity.
However, I encourage you to read through this review and do a quick Google search to see what the media has said about Debitize to further consider if it’s right for you.
The Best Features of Debitize
Debitize is pretty straightforward in its mission: curb credit card debt by turning your credit card into a debit card. What more can it do, you ask?
Interestingly, Debitize does have some handy additional features that help it live out its purpose, save you money, improve your credit, and keep all your information as secure as possible. Here are a few of the best features Debitize has going for it:
Free to Use
First and foremost, Debitize is 100% free to use. There’s no obligation to make any purchases once you sign up, nor are there any fees charged to use the service.
You might wonder, then, how it manages to make money? Debitize keeps its basic service free. You’ll be able to do everything you need to with that. But, it does offer some advanced features for purchase, which are completely optional.
Unlike other financial products that help manage your money, though, this one doesn’t charge you any fees to use it. You won’t have transfer fees or even a monthly subscription fee to worry about. Just sign up, connect your accounts, and start reaping the rewards.
Debitize makes preventing overspending easy with its automated withdrawal system. You won’t have to remember to move money from your bank account to Debitize when you make a purchase with your credit card because the system does it seamlessly for you.
Debitize holds the money it transfers in its reserve account until it’s time to pay your credit card bill for the month.
If you make a purchase of $54.61, the program automatically moves $54.61 from your linked bank account to your reserve account. You don’t need to do a thing other than let Debitize work.
Debt Destroyer is the Debitize feature that helps you pay off your current credit card balances, rather than just your current purchases placed on your cards.
This feature works like automatic savings transfers. You’ll set the amount and frequency you want Debitize to use to pay your card balances and it will automatically transfer the funds to your reserve account, and then to the credit card company, to do so.
You can set the frequency to daily, weekly, or monthly payments to find something that works best with your finances and pay schedule.
Not only does Debitize help you tweak your spending habits and make sure you get the maximum rewards you can from your credit card use, but it also can improve your credit as it works.
Credit utilization is one of the biggest factors in determining your credit score. If you use too much of the credit you have available at any given time, your credit score could get dinged.
With the Debitize Credit Optimizer, you’ll benefit from having a lower credit utilization number to improve your score.
The way it works is by Debitize paying your credit card bills right before your company reports your balance to the credit card bureau. You’ll have a lower credit utilization score this way than if it were to wait to pay the bill until after your company reports your balance.
Minimum Checking Balance to Avoid Overdraws
You might be worried about Debitize overdrawing your bank account to cover purchases you make with your credit cards. That’s a valid concern, but it’s not something you have to worry about with Debitize.
You can set a minimum balance you want to keep for your bank account that Debitize will never withdraw more than. The program sets a default of $100, but you can set it for any amount you’re comfortable with.
If you want to spend more than what you have in your account, Debitize won’t stop you. But, you can set up alerts to notify you when this happens, which can help get you back on track with spending.
Trust and Security
Putting all your bank and credit card account information online can be scary. But, Debitize makes it less scary by encrypting all information you send to the site.
Even more importantly, once you link your accounts, Debitize erases your sensitive information, rather than storing it on the site.
Plus, credit cards can be a more secure alternative to debit cards. Credit card companies are quick to alert you, and take care, of any security issues that arise with your card and account.
With your bank and debit card, you might need to wait weeks for the problem to resolve.
Free iOS Mobile App
If you want to keep track of your Debitize account when you’re on-the-go, the free iOS app can help. The company recently launched the app, so it likely has some kinks to work out.
But, you can link accounts, check your balances, receive alerts, and more, all through the app. Debitize plans to release a version for Android in 2018.
Is Debitize a Legit Way to Help My Credit?
For most people, it can be. But, as with most financial products intended to help you improve your credit and change your habits, Debitize is only as helpful as you are willing to change your ways.
Debitize is a legit online tool that can transform your credit cards to debit cards to help you still benefit from your rewards without spending more than what you have on hand.
With bank-level security and a feature that wipes away your linked account information once the process is complete, there are virtually no security issues to concern yourself with the tool.
With that being said, Debitize isn’t for everyone. People who don’t have the desire to stay within a budget when using credit cards for purchases won’t find much assistance from Debitize.
The tool won’t necessarily stop you from overspending; it will just give you a few reminders in the form of alerts.
Some people who have tried Debitize find that it’s just not necessary for them because they can do everything the tool does on their own. However, people don’t call its legitimacy into question in reviews and online discussions.
The tool can be a valid way to help you get on a good financial path toward improved credit and better spending habits.
How Can I Sign Up for Debitize?
You can sign up for Debitize by heading to the website and clicking the Sign Up button.
Debitize will prompt you to create an account by filling out your basic information, email address, etc.
Then, you’ll link your credit card account(s) by entering your account information. The site will only hold onto this information until the linking process completed. Once you link them, your information is off the site.
Next, add the information for your funding account. This is the bank account that will fund your purchases. Again, all financial information erases from the site once you’re done linking accounts.
The last step is verifying your identity to ensure that no one else signs up using your information. The site may ask you for the last four digits of your social security number, a copy of your driver’s license, or some other piece of information that helps to verify that it’s really you signing up.
Once you’re done, you can tweak your settings to set up your minimum balance, automated withdrawals to pay current balances, and more.
When you aren’t the savviest credit card user, a tool like Debitize can make paying your balances while maximizing rewards a breeze.
This handy online tool can automate the process for you. And, it ensures that you no longer make higher purchases than you can afford using your credit cards.
If you’ve tried Debitize, or currently use it, we’d love to hear from you! Feel free to leave a comment and let us know what you think about this online financial tool.