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Prepaid credit
cards have been around for over ten years now,
although they are just now coming into the
spotlight. Prepaid credit cards are basically credit
cards backed by major credit card companies that
offer you the ability to deposit money onto the card
and then use it for purchases. You are not allowed
to spend anything more than you have deposited in
most cases. It is a great way to teach students good
financial responsibility. There are a lot of
advantages to prepaid credit cards, and only a few
disadvantages. However, before committing to any
prepaid credit cards, you should be clear on the
company's rules and fees.
No Credit Checks
One great thing about prepaid credit cards is that
there is usually no credit check required. This
makes prepaid credit cards ideal for those with
lousy credit scores or even those without any
previous credit to build their credit. If you have
bad credit, this is a nice way to slowly rebuild
your credit score. Creditors will see the card on
your report and see if you use it responsibly and
often.
No APR
Many prepaid credit cards offer no APR on money
deposited and your purchases. Some do charge high
interest rates on your balances however, so beware.
There is no reason you should pay a monthly interest
rate on money you have deposited or on purchases.
Therefore, you should certainly look for cards that
offer no APR. Fees
Just like the bank, some prepaid credit cards charge
fees on your transactions. Some prepaid credit cards
will charge you ATM fees or cash withdrawal fees.
These are the most common fees with prepaid credit
cards. Some cards however may try to charge you a
monthly usage fee. Try to get a prepaid credit card
that does not charge this monthly fee. They exist
out there, so just search. You will save yourself a
lot in the long run by avoiding a monthly fee on
your prepaid credit cards.
Direct Deposit
Prepaid credit cards often have the ability to allow
you to directly deposit your check onto your card.
This eliminates the need to go to the bank each
week. This is the perfect option for the cardholder
that uses their prepaid credit card for everything.
Take advantage of these convenient options, as they
can save you time. The truth is, prepaid credit
cards are responsible ways to spend money. They give
you the option of using your money anywhere credit
cards are taken without leaving you with a high
monthly bill. Prepaid credit cards can also offer
reward programs and other incentives similar to
regular cards. They are convenient and low risk. As
with any credit card, make sure your prepaid credit
cards have terms which with you agree. It is better
to read everything before rather than later.
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regarding all aspects concerning Credit Cards. Get
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