There are many benefits of prepaid credit cards, all of which may have you considering this product at some point. While it may not be necessary if you have good or excellent credit, it’s the perfect choice for those who have no credit or poor credit.
Here are five of the top benefits of prepaid credit cards:
1. Less risk of overspending
With a prepaid credit card, you can only spend up to your balance. So, if your balance is $1,000, there’s no spending more than this. But with a traditional credit card — one that has a higher spending limit — it’s easier to overspend (and regret it later).
2. Easy to use
Many people don’t realize that a prepaid credit card works in the same manner as a traditional credit card or debit card. Once it’s funded — which you can do online via a bank transfer — you can use it for everything from gas to groceries to eating out.
3. Safer than cash
If you don’t qualify for a credit card, you may assume that carrying cash is your next best option. The problem with this is that carrying a large amount of cash is dangerous on many fronts. Not only does it make you a target of criminals, but if you lose the money there’s nothing you can do about it.
With a prepaid credit card, all you have to do is cancel it and wait for a new one to arrive by mail.
4. It’s secure
In today’s day and age, financial security is more important than ever before. Risks are lurking around every corner. Prepaid credit cards offer more anonymity than traditional credit cards. Not to mention the fact that personally identifiable information is kept to a minimum.
5. A good bank alternative
Even though the majority of people have a checking and/or savings account, millions live their lives without access to a financial institution. Prepaid credit cards allow you to better manage and spend your money without a banking relationship.
If these benefits sound good to you, learn more about the many available offers you can choose from. The more information you find, the greater chance there is that you’ll go down this path in the future.
Don’t overlook the power of a prepaid credit card. There are a lot of myths circulating, so do your own research to ensure yourself of making an informed and confident decision.