How to Choose the Right Prepaid Credit Card for the Holidays


If you need to use a credit card this holiday season but cannot get approved for a regular credit card, a prepaid card can be a good option.  Nevertheless, some prepaid credit cards are notorious for their high fees so you want to make sure that you will make the right choice.

With so many prepaid cards to choose from in the market, how can you pick out the right one for you?  Here are some practical tips:

Find a prepaid card that matches your purpose. How do you plan to use the card?  What kinds of purchases do you want to use it for?  Do you need a prepaid card that you can bring with you on an international trip?  Prepaid credit card features vary so you should be clear about your purpose and then look for a card that complements your particular needs.

Read and understand the fine print.  Although it is very easy to get a prepaid credit card, you should still spend some time reading the fine print.  What are the terms of use and what are the exact fees you need to be aware of?  What are your privileges and limitations as a prepaid cardholder?

Compare the costs and choose one that is more affordable.  As mentioned in the beginning of this article, some prepaid credit cards are known to carry outrageous fees.  Prepaid cards that are endorsed by celebrities or bear their names and photos are usually the most expensive cards too.  You need to look beyond the design of the prepaid card and compare the specific fees.

Common prepaid credit card fees include the set-up fee, monthly fee, per transaction charge, inactivity fee, overdraft fee, and more.  You might even be charged each time you call up the customer service hotline to ask for assistance.  Needless to say, you should compare and choose the prepaid card with a minimal set of fees.

Choose a prepaid card that offers reasonable security.  Prepaid cardholders do not enjoy the same protection as real credit cardholders do.  For instance, you may not be entitled to the same kind of protection against liability or unauthorized charges.   However, the ideal prepaid card should offer liability protection or free card replacement for lost or stolen cards.  This means, you will be issued with a new prepaid card with the same amount of load in case the card is lost or stolen.

Avoid extra fees by complying with the rules.  You need to be familiar with the terms of your prepaid card.  For instance, most prepaid cards impose an overdraft penalty.  This is the fee you will incur if the amount of your purchase is higher than your available balance.  IF there is only a small difference between the total purchase and the available balance, the transaction may still successfully go through.  However, you will incur the overdraft fee and this will be deducted to your balance the next time you reload the card.

About the Author:

Tara Tiemann is the credit specialist for http://www.go-prepaid.com.  Which is a resource site for people who want to live debt free! If you are on a budget, using a prepaid credit card and bad credit credit card can save you big money!


About Liz Roberts

Liz Roberts is the new credit specialist for Go-Prepaid. If you are on a budget, we can get you discounted cell phone service from Sprint, Verizon and T-Mobile! NO CREDIT CHECK ! Using a prepaid services can save you a TON of money! Follow our blog to find out how!

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