Is a Prepaid Cash Card a Good Idea?

by Isabella Craig on 2013/05/07

A prepaid cash card is very similar to a debit card and basically a good idea for just about anyone. However, these are not connected to a bank account like the other cards and every time it is reloaded, a small fee is charged. You also have to pay several other kinds of fees, besides the ATM fees.

These cards can be used as a gift card and unlike the restrictions of store specific cards, these can be very useful for a number of tasks like hotel room booking, renting a car, or paying for airline tickets. You can give it to a friend, family member, or your child as a special gift. This gift will be long remembered since it will help them manage their expenses better. You can even reload the prepaid cash card if you want.


Get Freedom from Interest Payments

The conventional credit cards have many problems that are not present in prepaid cards. That is the reason why they are considered as excellent replacement for conventional cards. By using prepaid cards you can avoid all the pitfalls of unsecured credit. There are some consumers who find it really tough to get enough credit in order to help them achieve their goals and do things like renting a car on a business trip.

But, by using a  prepaid credit card, it can help eliminate basic problems like extra fees and interest payments incurred with a conventional card. Despite the fact that there are a few minor fees involved, you still save a sizeable amount of money if you add up the savings on interest alone.

Do Proper Research

Many financial institutions offer these cards and are well known by their logos. FDIC does not cover them and so it is necessary to thoroughly research each institution before deciding on any one of them. There are many ways to research, but a good option is to read about the various benefits on offer at different websites.

Itemize Your Expenditure

The non-credit spending of this type is a blessing in disguise for many, with respect of budgeting assistance. Similar to a conventional credit card you can get a statement that helps you in itemizing your spending. The days of worrying about overspending and over the limit spending fees are gone since this card is prepaid. You know the money is there for you to pay for your purchases with no hassles and without any concerns regarding monthly payments.

Not a Credit Building program

Prepaid cash card is ideal for those people who are looking for a fresh start with credit but finding it difficult to get any. At the moment you won’t find any credit builder programs with these cards, which makes it a bit difficult to rebuild your credit rating. If you are looking for a way to rebuild your credit, a secured credit card is for you.

Conclusion

Finally, it is up to you to research all the choices available to you before making such an important financial decision.

Courtesy of CreditCardShoppe.com.

 

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