Prepaid cards can make life easier for people who don't qualify for a regular credit card. It's unfortunate that in today's world you often need a credit card to book a flight, make a hotel reservation, or rent a car. To make matters even worse, a credit card is often required for most online purchases. But, that doesn't mean that there isn't another option.
A prepaid card can give you many of the advantages of a regular credit card without having to worry about interest rates. To get started with this type of card, you will be required to deposit either cash or your paycheck to open an account and load the card.
You will then be issued a card that can be used generally anywhere a regular credit card is accepted. In fact, many carry the Visa or MasterCard logo so they look just like a regular card. When you make a purchase, the charge is deducted from the money that is loaded into your account. Once you use up the initial deposit, you can't spend any more until you make another deposit. Basically, it's like using a debit card that is tied to your checking account.
Are there any drawbacks to a re-loadable prepaid card? Well, most programs require an account setup fee, in addition to ATM withdrawal fees and deposit fees. This is why it is always a good idea to read the terms and conditions before you apply for any card. While there is a cost involved with using this type of card, you don't have to worry about over-spending on your budget, because you can only spend up to the amount that you have deposited into your account.
Below, you will find some of the best prepaid cards, classified by specific use or type:
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You can also check out other cards designed for people who don't qualify for a standard credit card by clicking on the links below: