Prepaid credit cards-Less risk and reduced spending


United States, 30th September: If you feel worried about carrying cash with you or want to avoid writing checks, then prepaid credit cards are the answer for you.
 

United States, 30th September: If you feel worried about carrying cash with you or want to avoid writing checks, then prepaid credit cards are the answer for you.

Working of prepaid credit cards—Such credit cards are issued by several companies including Visa, Mastercard etc. and range for amounts as low as $25 to large sums. Such cards can be received through the official websites of the credit card company or even from supermarkets and convenience stores.

You can get to know your balance at the stores selling such credit cards, at ATMs or online.

Advantages of prepaid credit cards—–

Prepaid credit cards are good for inculcating good budgeting habits among people. the good thing of using such credit cards is that you are aware of your spending limits, says Timothy Wyman, financial advisor at the Center for Financial Planning, Southfield, MI. so, there is no worry for overdraft charges or interest fees levied by banks on the users of debit cards.

Hidden fees and costs—

No doubt, such credit cards are not absolutely free. Such hidden costs and hidden fees include activation fees and monthly fees which range between $3 to $40(for activation fees) and $3 to $10 for monthly fees. Costs which can be avoided by the credit card users are balance inquiries at ATMs, paper statements etc. by making enquiries online.

Although all stores, hotels or gas stations usually accept most of the prepaid credit cards, but if you try charging more than the balance on your card, then the card is likely to be rejected. So, try using a small amount and pay the remaining money through some other means.

On the whole, prepaid credit cards might be somewhat trickier than other credit cards in terms of usage and might also have the fees as in other types of credit cards.

However, the wisdom lies in using them in a smart way.

So, stay within your budgetary limits of prepaid credit cards and experience the freedom of using these cards without burdening yourself with carrying cash in your wallet wherever you go. Also, you don’t need to hide your money behind your belts or socks to avoid losing it.