Do You Know What Prepaid Credit Cards Are?

By Steven J. Talrechi

Credit can be a touchy subject for many individuals. Often it can be quite difficult to be approved for a traditional credit card. Perhaps you have had a poor credit history in the past, or perhaps your problem is that you just haven't had any credit history yet. Whatever your circumstances are it can feel downright degrading to get rejected for a credit card. However, there is a way that you can start building your credit rating and give you the flexibility that a credit card affords you, and that is by getting yourself a prepaid credit card.

So, what exactly is a prepaid credit card? Well, it's basically an account that can be reloaded that is accepted any place that you might use a traditional credit card. The individual card holder will deposit money into their account before making any purchases. If you have money in your account then you are free to spend with your prepaid card. Like a traditional charge card your prepaid card will have a spending limit set which is determined by how much you have deposited into your account, and how often you are able to deposit money.

A prepaid card will give you several benefits that you can enjoy. The first is that you'll be able to develop a sense of spending freedom. With you're prepaid card you'll be able to buy anything from any store that regularly accepts credit cards.

A prepaid credit card is also a very useful tool for you to control your spending. By only purchasing items when you have already dedicated money for them you are ensuring that you are not going to fall down the slippery slope to major credit debt. With your prepaid credit card you will learn how to handle your finances effectively. That education will be something that you can take with you through the years.

Additionally, a prepaid credit card will give you the peace of mind that no one is going to be able to get a hold of your credit card numbers. This way, if you're purchasing things over the phone or internet you can rest assured that no one will have any way to access your other accounts and money.

How do you get a prepaid credit card? You'll have to pay a fee to set up the account; this is usually somewhere between $5-$10. There are also some small fees associated with deposits as well. These fees are small, but well worth it to control your spending and help build your credit.

Let's face facts, we live in a credit driven world today. It seems like you can't do anything without a credit card these days. So if you want to be able to function in this world you need to find a way to have access to a credit card. For those who are struggling with bad credit, or want to keep better tabs on their spending then a prepaid card might be exactly what you're looking for!

About the Author:

Steven J. Talrechi is a veteran on credit and finance for over 10 years. He authors various topics on said field, including applying for a credit card, and different credit card offers.