Which of the following statements best explains why a debit card linked with your checking account is a good option for regular spending?

• A. It offers higher interest rates on your checking account balance.
• B. It provides unlimited cash-back rewards on all purchases.
• C. It automatically builds your credit score with every purchase.
• D. It allows you to spend only the money you have, helping to avoid debt.

Answer: (D)

Verified step by step guidance

1. Understand the purpose of a debit card: A debit card is linked directly to your checking account, allowing you to spend only the money you have available in your account.
2. Compare the options provided in the question: Evaluate each statement to determine which aligns with the functionality of a debit card.
3. Option 1: 'It offers higher interest rates on your checking account balance.' This is incorrect because debit cards do not influence the interest rates on your checking account.
4. Option 2: 'It provides unlimited cash-back rewards on all purchases.' This is incorrect because debit cards typically do not offer cash-back rewards; such features are more common with credit cards.
5. Option 3: 'It automatically builds your credit score with every purchase.' This is incorrect because debit card transactions do not impact your credit score. The correct answer is: 'It allows you to spend only the money you have, helping to avoid debt,' which reflects the primary benefit of using a debit card for regular spending.