Do you feel more comfortable spending the money you know you have? If so, a debit card might be your best option. When you make purchases, it withdraws funds directly from your checking account, so you won’t spend more than you have.
5 Smart Debit Card Practices
How Prepaid Cards Work
You may have received a prepaid card before as a gift. Unlike debit cards, prepaid cards are not tied to a bank account. When you make a purchase with a prepaid card, the amount is subtracted from the balance of the card. Here’s what you can do with it:
Prepaid cards as a financial teaching tool – Prepaid cards can be a great way to help young people gain experience budgeting, using ATMs and making purchases. Because you aren’t given a line of credit, you can’t overdraw from your account. The cards are low-risk and allow parents to access the accounts online.
Prepaid cards as an alternative check cashing tool – Many consumers still operate outside the traditional banking system and take their checks to check cashing stores. This practice can get quite expensive with fees, so choosing a prepaid card that offers the ability to directly deposit checks without ATM withdrawal fees will save you money in the long run.
Need a little guidance on how to correctly fill out financial institution forms? Consider using these step-by-step guides for making a deposit, writing a check, using a transaction register, reading a bank statement and reading a credit card statement.