The first term of any prepaid card is petty obvious–you can’t spend more money than you load onto the card. If you use up the remaining balance on your card and still owe more, most merchants will allow you to pay the rest of what you owe with another form of payment. If, for some reason, the merchant allows you to charge more than the remaining value of the card, you will be responsible for the overage.

In general, prepaid cards can be used to buy goods or services just like most other types of credit cards, but sometimes there are limitations on certain types of purchases or on the number of purchases that can be made in a given time period. Often, there will be terms stating that a prepaid card cannot be redeemed for cash, but many prepaid cards can be used in ATM machines like a credit or debit card, assuming that you have been given a pin number.

In most cases, refunds to a prepaid debit card will need to be credited back to the card (to deter people from using cash refunds as a way to get cash advances without paying an ATM fee). For foreign transactions, there will usually be terms in place defining how an exchange rate will be selected and applied.

There are a number of terms and conditions that apply to prepaid credit cards. Some are pretty standard, but others might vary considerably from company to company, so it’s always a good idea to read the fine print.

Prepaid cards often carry hidden fees that most consumers are not aware of until the charge appears on their card balance. One such cost is the monthly maintenance fee, which may run as high as $14.95. However, many cards will waive that fee if the cardholder uses direct deposit to reload the card or reloads a minimum amount each month. In addition, most cards charge an initial activation fee, and many charge cardholders to reload the card.

Many prepaid cards add a fee for at least one type of normal use for the card. Transaction fees may be as low as $0.25 or as high as $2.00, although not all cards charge for normal transactions. Other charges might result from cash withdrawals at ATMs, both in and out of network. Some of the heftiest fees are for purchases that were declined due to insufficient funds remaining on the card.

Trying to manage a prepaid card’s funds may rack up charges for balance inquiries or phone calls to customer service, although many do not charge for inquiries or balance alerts made by email or text message. It’s also possible to run up fees for prolonged account inactivity, or even to close an account.

Prepaid card purchasers need to find out about card fees before setting up an account, and in many cases, the best way to do that is through the card’s website.

When evaluating our reviews and comparisons of prepaid cards and debit cards, take in to consideration value added benefits. The will vary with each card. Some cards offer zero monthly fees, while other cards offer free direct deposit. One trend is card companies offering a free credit score when you sign up for their card. Most all prepaid cards have 100% guaranteed approval. The two most common brands are Visa and MasterCard, though other financial institutions have entered the prepaid space, namely American Express.

The important thing is to shop around, take notes and go with the card which is right for your own individual needs and budget.

The first fee that you may see is the activation charge. This is the basic charge that the company will charge you for signing up to use their card. Many companies will also have a promotion available where they will waive the activation fee. Whether or not the fee is waived, make sure that you read the fine print to see if this is a one-time activation fee or if this is a yearly fee. This activation charge usually ranges anywhere from $9.99 to $20.00.

Another fee that you may encounter is a monthly maintenance fee. This is a small monthly fee that many prepaid card companies charge for simply having the card. There may be stipulations set by the prepaid debit card company to waive that fee. The company may waive the fee if you set up direct deposit of your paycheck or monthly benefits. There may also be a waiver of fees if upon a certain amount of usage on the card. This monthly maintenance fee can start from $1.99 monthly to $5.99.

The last type of fee that you will encounter while researching these cards is the transaction fee. There are three basic type of transactions that you will make with your prepaid debit card. The first is the point of sale, also known as a POS transaction. With this transaction, you usually do not enter the PIN but you will have to sign the receipt in most cases. There are some businesses that may not require a signature such as fast food restaurants. There may or may not be a fee for a POS transaction. If there is a fee, it is usually about one dollar.

The second type of transaction is PIN based. Instead of a signature, you will enter the PIN that you chose when activating the card. Again, the fee for this transaction is usually about $1.00.

The third type of transaction is when you use the ATM to withdraw cash. The charge for this can range anywhere from $2.99 to $4.99, depending on the company. On top of this charge, you will also be charged for the actual usage of the ATM by the company who owns the ATM machine.

No matter what company you choose to use, be sure that you read all of the user terms so that you will be well aware of the charges that you may incur.

When it seems like your hard-earned money is flowing through your bank account like water through your fingers, it’s time to take a look at your spending habits. Stretching every dollar takes some thought and planning, but you’ll be rewarded for your efforts.Set up a budget. If a budget sounds like a set of rules that takes the fun out of life, try to think of it as a picture of how you spend money. There are easy-to-use programs available online that will show you how to plan for all your monthly expenses.

Stick to your budget. This may sound obvious, but temptations to spend are everywhere and it’s easy to succumb to their lure. When you want to splurge on something outside your budget, think it through. Weigh the immediate pleasure of the purchase against not worrying about paying the water bill.

Keep track of your spending. Whether you write it down or do it electronically, an immediate record of every purchase lets you know how much money remains in your account. Relying on mental calculations using rounded off figures and estimates can lead to errors that get you in trouble.

Always use cash or a debit card. Don’t give in to buy-it-now, pay-later thinking. Whether you use a credit card or a store payment plan, any kind of delayed payment always costs more in the end.

Be wary of sales and coupons. They can be real money savers when used wisely to purchase items you would buy at full price, like your kids’ favorite cereals or a replacement pair of running shoes. They can also let you buy things you can’t afford at full price, like the trendiest jeans, but be cautious about using them to buy things you don’t need. Don’t ever buy something just because you have a coupon for it or it’s a good deal. After all, a box of cereal no one ever eats is just a waste of money.

Do your homework before spending on home repairs you can’t do yourself. This is a case where spending a bit more to get the work done correctly the first time may save in the long run. Get references and check online review sites before hiring.

For example, these cards are safer than cash because they offer more protection from burglary. Because they can be processed like a standard debit card or credit card, prepaid debit cards can be used for most purchases. A pre paid debit card also protects users from going into debt because it is impossible to spend more than the card holds. Finally, these cards require no credit check, and paychecks or government benefits can be direct deposited onto the card without a fee.

In spite of these benefits, however, critics warn that these cards will do more harm than good. Many of prepaid cards are overrun with fees, which decrease the card’s balance over time. Though each fee is relatively small, they eventually add up to an amount many consumers would not want to pay. A prepaid debit card may carry ATM withdrawal fees, charges for loading the card, a fee for opening the card, and a yearly or monthly fee for simply having the card in your possession.

A new prepaid debit card, sponsored by financial expert Suze Orman, claims to carry more modest fees than the other brands. This card, called “Approved”, will cost consumers only $3 to purchase and $3 per month for use. The Approved card will also be sending usage information to TransUnion, one of the major credit bureaus, in hopes of finding a way to use debit card activity to alter consumer credit scores. Orman promises that the fees on this card will never increase. She also states that she hopes to lower the fees or eliminate them altogether. Nonetheless, consumers should be cautious with any prepaid card.

According to financial analysts, the current state of the economy will cause prepaid debit cards to grow in popularity even more in coming years. However, consumers of these cards should research their cards carefully to how much the fees will be and how they can be avoided. In addition, consumers should choose a card that issues paper statements so that they can be sure they aren’t paying any fees they don’t owe.

Another benefit to having this type of card is that the lender may report a transaction record to the major credit reporting agencies. This will build or help rebuild the consumer’s credit record. For a young person, obtaining a secured credit card may be their only option for building a new credit record. Persons who have gone bankrupt may also wish to use the benefits of a secured credit card to rebuild their credit record.

If the consumer defaults on a payment, the lender can use funds from the customer’s secured account to make the payment, thus incurring no risk. The lender may put a hold on the consumer’s ability to use their secured credit card until the arrearage is resolved, or they may close the account and seize the security deposit to pay unpaid charges.

Another type of secured credit card is the prepaid debit card that is available for purchase at many retailers, such as a grocery store. Since these are paid in advance, there is no security account required and no billing. They are “secured” by the prepayment and set limit. Some of these cards have a capability for reloading with more money. When the card is fully charged down, it either is no longer available for use or it must be reloaded with additional cash. These make excellent gifts and they are nice to have if the consumer is unable to obtain a credit card any other way. They are not true “credit” or “debit” cards, because they are a very simple pay-as-you-go card, but they do mimic the standard credit or debit cards and can be used where regular cards may be used.

Direct deposit is one of the simplest ways to add money to your prepaid credit card. When you choose to incorporate direct deposit into your routine, you are enabling your paycheck or other government benefits to be deposited onto pre paid debit cards. Not only are you going to receive your money faster than ever before, but you will also have the freedom and flexibility of not having to carry around a bunch of cash with you. You will save time and fees as well because you will not have to worry about going to a bank to get your money. It will already be with you as soon as you awaken on payday. There will never again be the fear of what would happen if your check was lost in the mail or on the way to the bank.

Prepaid credit cards take all of the hard work out of getting paid for you. You may be wondering how exactly they work? It’s simple really. Almost all of the prepaid credit cards are going to come with a routing number and an account number that pertains to their financial institution. You are going to need to provide this information to your employer to begin the direct deposit process. It will be treated the same way as if you had a regular bank account at a local branch near you. The convenience and flexibility that you are going to have with direct deposit will be like nothing you have ever imagined. You won’t have to worry about getting approved for the credit card because there are no credit checks involved. What more could you ask for? Get yours today!

* Prepaid Debit Cards – these can be purchased at a merchant or financial service provider like a cash advance store. Some are limited to the face value; others have the capability of accepting additional cash deposits so they can be reused. A purchase amount will be immediately deducted from the card balance when used, until the balance is zero.
* Prepaid Credit Cards – these can be obtained from a bank or credit union. The user must leave a cash deposit with that financial institution equal to the card limit. These are called a secured credit card, as the risk is backed by the savings deposit that is held. A bill will be received monthly and must be paid. If the bill is unpaid, the bank or card grantor will take funds from the security deposit to pay that bill; this may jeopardize the availability of use of that card.

Prepaid cards are safer to carry than cash, and they can be used globally wherever merchants accept Visa or MasterCard. They make excellent gifts and can help teach youngsters how to manage credit cards. Credit history is not an issue with prepaid cards; prepaid secured credit cards can be used to establish a good credit history. Some prepaid cards can be reloaded online, over the telephone or at an ATM.