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Prepaid debit cards are the wave of the future. get used to. They make sense in this tough economic climate and they will make sense when the economy improves. More and more people are finding that spending money you have is a better way to spend money you don’t have (credit) and prepaid debit cards are the best financial tool to do so .
Now there are lots of reasons why these prepaid Visa cards and prepaid MasterCards are useful, but let’s take a look at three.
no credit check
Prepaid card companies are selling you a product, not credit. So there is no need for them to do a credit check before issuing the card to you. This is great news for many people who have no credit or very bad credit because it means they get guaranteed approval. And that means they can get a card and use it to make all kinds of purchases that one can make with a normal credit card.
No Monthly Finance Fee
Credit card companies make a lot of money by charging finance charges on the amount you owe. That fee can be calculated in many different ways and the terms can be changed any time the credit card company wants to change them. But prepaid debit cards do not have any credit balance and hence no finance charges. Instead there is a monthly maintenance fee which is usually very low and does not change from month to month. This saves you money in the long run and makes it very easy to manage your finances every month.
no long term contract
Once you’ve charged a balance on a credit card, you have virtually no control over your relationship with the credit card company. That is of course unless you can afford to pay off the entire balance. Most people can’t do that, so they’re stuck with whatever terms the credit card company wants to offer. And those changes are almost always made to benefit the credit card company, not you.
But your relationship with prepaid debit cards is different. You have already loaded your card; The money is already yours, and the prepaid card company is in no position to change the terms for you. If they did, you could just spend your money or quit and take your business elsewhere. You are in the driver’s seat not the company so you can end your relationship with them whenever you want. It’s a powerful position to be in.
If you’re starting to come around to the idea that making payments is a better way to manage your finances than using an expensive credit card, then you’re a prime candidate for a prepaid debit card. Do yourself a favor and learn more about this popular and powerful budgeting and financial tool.
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