Is using prepaid cards is beneficial? All about prepaid cards – FoolInvestor

                                                                      PREPAID CARDS

The trend of using prepaid cards keeps on increasing. People like to use these cards to pay off for their daily needs like they use prepaid cards at gas stations, grocery stores, and to pay their bills.

Well prepaid cards are totally different from the credit cards and debit cards we use. And In this article we will cover about – 

– What are prepaid cards? 

– What is the difference between prepaid cards, debit cards and credit cards?

– What are the types of prepaid cards?

-What are hidden mistakes that we should avoid?

– How to choose a prepaid card for you?

Moreover, In this article we will also share about one of the best Pre-Paid card that will help you to get 1% on each and every transaction we make. So read this article carefully – 

What are prepaid cards?

As it is being cleared from the word “Prepaid” means the cards which are already loaded with a specific amount of money and ready to use for any purpose we want. Prepaid cards are the alternative of cash and these are totally different from the debit cards and credit cards.

Types of Prepaid cards – 

1) General-Purpose Reloadable cards-   In this we are talking about the cards which are loaded with a specific amount of money and ready to use like debit cards. We can easily reload these cards when they reach their limits.

2) Gift cards – These cards are used for the purpose of a gift. For example – On the birthday of your friend you like to give him a pair of shoes but you never know his or her choice then you can simply give him a gift card of that particular shoe company. For example –  You can gift an Amazon gift card.

3) Payroll cards-  Well, some of the employees receive payroll cards with the amount of their salary which they use to pay off their bills, Food, and for any type of purchase they like.

What is the difference between the Prepaid cards, Debit cards, and Credit cards?

1) Credit Cards- These cards let people borrow  money from the bank up to a specific limit, we have to pay them back and if we miss the due date then we have to pay some interest over it. And we can receive these cards from our bank or any credit union. And after using these cards we can make good credit scores which help us to get car loans, and mortgages at good interest rate.

2) Debit cards- These cards are issued by the bank and linked with our savings or checking account. We do not need to pay any interest on their use but there is a specific penalty fee on the overdraft.

3) Prepaid cards- These cards are already loaded with money and we can use them to buy things. These are just like the debit cards but they are not linked with any saving or checking account. When we use all the money loaded in these cards they will stop working until we never reload them.

What are the benefits of using Prepaid cards? 

– Easy to Get – These prepaid cards are easy to get.  For example-  you can easily get them any superstore.

– Easy to Use – These cards are very easy to use and you can use them anywhere.

– Help in Budgeting – These cards are pre- loaded. So you can load them with your monthly grocery budget which can help you to be in budget.

– No bill- With a prepaid card you don’t have to worry about any monthly bill. For example – we receive in case of credit card.

– No debt – These cards are already loaded so you can only spent the pre- loaded money.

– No bank account – With these cards you never need to open a bank account. Meaning you can buy it for cash and ready to go.

– Safer- These cards are loaded with a limited amount of money . So they are safer as compared to others. Because if you lose a debit card then the thief can drain your whole account. And if you lose your credit card, the thief could rack up substantial charges. But with prepaid you only lose a limited amount and some prepaid cards also provide protection against theft or loss.

– Overdraft protection – When you reach the $0 these cards will stop working.

What are the disadvantages of using prepaid cards?

– Hidden fee- Well this is the biggest con of these cards. Because there are lots of fees associated with these cards. And all different cards have different fees so please check yours.

– No interest – These cards never give you any interest for storing money in them.

– No credit history- By using these cards you are never making any credit history for the future.

Earn 1% cash back with your Cash Card – Wealthsimple  Cash

WealthSimple Cash –  It is a kind of prepaid card. which work similar to our debit card. But the interesting thing is we can get 1% cashback on every Purchase.

In Canada, Wealthsimple Cash allows us to get 1% cashback on whatever we purchased using the Wealthsimple Cash. 

What are the Benefits of Wealthsimple Cash –

– 1% cash back on every transaction.

– NO transaction fee

– No minimum Balance  requirements

– We can directly invest that into our TFSA or Crypto Account.

– Sign Up by clicking here and get $10 in your Account.

All the prepaid cards have different terms of using them. So please check the information of the card which you are using like the fees of using and any other.


Leave a Reply

Your email address will not be published. Required fields are marked *