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Prepaid credit cards can be a useful way to control your finances if you don’t have a bank account, to gift money, or to teach your kid financial discipline. You can use a credit card to purchase a prepaid card in a retail store, a financial services center, or online, but for the best value, you’ll need to do some careful research beforehand to avoid cards with high fees.
Steps
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Buy a card in a retail store. Most gas stations, drug stores, grocery stores, and big box stores sell prepaid credit cards. Though it is up to individual stores whether they accept credit cards for such purchases, the vast majority of them do. Generally, the amount on the card will be the amount you paid. However, because selection in stores is limited and buying there often costs more, it is generally a better idea to shop online.
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Purchase a card at a financial services center or currency exchange. You can find prepaid cards at many banks, credit unions, check cashing stores, and currency exchanges. As with retail stores, some location might not accept credit cards as a form of payment, though this is rare. As in the case of the Green Dot prepaid Visa, the fees associated with these cards are often less than if you purchased the same card in a retail store. [1] X Research source Because the fees vary dramatically from card to card, it is best to compare cards online before purchasing.Advertisement
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Get a card online. There are dozens of cards available online, all of which can be purchased easily with a credit card. Usually, you will find better deals here; for instance, activation or initial purchase fees are often waived. For the best card, be sure to comparison shop.
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Keep the receipt. Always keep the receipt in case you or the person you give the card to has difficulties using it.
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Avoid costly fees. Prepaid credit cards are not regulated like debit cards or normal credit cards, and as a result they come with a dizzying variety of fees. You can check here for some of the fees on the most popular cards. Before buying a card, however, be sure to read the fine print and check for:
- Activation or initiation fees
- Monthly fees
- Per transaction fees
- ATM fees
- Balance inquiry fees
- Fees to add money to the card
- Fees for paper statements
- Fees for customer service calls
- Bill payment fees
- Fees for not using your card
- Fees when closing the account
- Overdraft fees
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Stay away from cards that charge per transaction. If you are going to use your card regularly, pay-as-you go cards will cost you a lot of money. A low monthly maintenance fee is a better option, unless you are only using your card in emergencies. In that case, also make sure your card does not have an inactivity fee. [2] X Research source
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Watch out for cards that charge per deposit and have deposit limits. Most cards will waive deposit charges if you use direct deposit, PayPal, or a bank transfer to fund your card. Adding money at a retail store usually entails a charge ranging from $2 to $6. Some, however, charge for all deposits. For these cards, you’ll want to add funds infrequently in large amounts, so make sure they don’t have limits on how much you can add at one time or in a given month.
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Use a card comparison site. Sites like BankRate.com and Consumer Reports offer comparisons and recommendations to help you select cards with the fewest fees. Some of the most highly recommended cards include: [3] X Trustworthy Source Consumer Reports Nonprofit organization dedicated to consumer advocacy and product testing Go to source
- Bluebird – An American Express branded card that includes bill pay (can send paper or electronic checks from the account), no monthly fee, no activity fee, no fees for customer service, no inactivity fee, and no declined transaction fee. [4] X Research source
- Chase Liquid – A Visa branded card that has a $4.95 per month maintenance fee (waived if card is linked to a Chase bank account), but offers overdraft protection and no other fees, so long as you use in-network ATMs for withdrawals and account inquiries. It does not have bill pay. [5] X Research source
- Visa Rush Card Unlimited Plan – Has a one-time activation fee and a monthly fee of $5.95 (if you use direct deposit) or $7.95 (if you don’t), but has no other fees, so long as you reload via PayPal or direct deposit and use in-network ATMs for withdrawals and balance inquiries. [6] X Research source
- Green Dot Prepaid Visa – Card with a $5.95 monthly fee (waived if you deposit a certain amount each month or have a certain number of transactions) but no other fees so long as you buy the card online and use in-network ATMs for withdrawals and balance inquiries. [7] X Research source
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Community Q&A
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QuestionCan I buy a prepaid card at a gas station using my gas station credit card?Community AnswerIt depends on the gas station. Some will not let you use a credit card to buy a prepaid card.
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QuestionCan I buy a prepaid credit card with a prepaid credit card?GladmanedCommunity AnswerYes, as prepaid credit cards act like regular credit cards.
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QuestionIs buying a prepaid debit card with a credit card like taking cash out?Community AnswerYou are basically transferring cash from a "permanent" card to a temporary, disposable one.
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References
- ↑ https://www.greendot.com/greendot/cardholder-agreement?from=landingpage
- ↑ http://www.creditcards.com/credit-card-news/help/9-things-you-need-to-know-about-prepaid-cards-6000.php
- ↑ http://www.consumerreports.org/cro/prepaid-cards/buying-guide.htm
- ↑ http://www.bankrate.com/finance/banking/bluebird-by-american-express-walmart.aspx
- ↑ http://www.bankrate.com/finance/banking/chase-liquid.aspx
- ↑ https://www.rushcard.com/Fee-Chart
- ↑ https://www.greendot.com/greendot/about-the-cards#simple_fee
About This Article
Article Summary
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To buy a prepaid credit card with your credit card, look for one in a gas station, drug store, or grocery store. You can also buy prepaid credit cards at many banks, credit unions, and currency exchange stores. Alternatively, buy one online for more options. When shopping for a prepaid credit card, make sure you read the fine print for fees. Since prepaid credit cards aren’t regulated like regular credit cards, many of them have fees for activation, transactions, and withdrawals. For the best deal, use an online credit card comparison site, like Bank Rate and Consumer Reports. Some of the most recommended cards are Bluebird, Chase Liquid, and Visa Rush Card Unlimited. Stay away from cards that charge per transaction or deposit, since these fees will add up. For more tips, including how to waive deposit charges on prepaid credit cards, read on!
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