Surveys show that nearly 75% of prepaid credit users are very or even extremely satisfied with their cards. The fact that they can’t overspend combined with the convenience and safety of using a card instead of cash means there’s a lot to like.
Choosing a prepaid card can be a bit of a challenge, however. There are lots of different card providers with a wide range of fees. Let’s look at the best prepaid cards available today.
Advantages of Prepaid Cards
Prepaid cards offer several advantages over traditional credit cards, including:
- No chance of overspending
- Often no credit check is necessary
- Poor or no credit history won’t limit your options
- Limited exposure to fraud
All three major credit card companies offer prepaid cards – Visa, American Express, and MasterCard. You can use them anywhere that accepts those cards so they’re as convenient and easy to use as a credit card would be. You can even use them for online purchases, something that often isn’t possible with a regular debit card.
The following five cards are our picks for the best options.
1. American Express Serve Cash Back Prepaid Card
The Amex Serve cash back card offers a 1% cash back reward for every purchase. The reward gets added to your card immediately after the transaction is complete and you can redeem your rewards anytime.
The Serve card offers free ATM withdrawals through any ATM in the MoneyPass network. Out-of-network withdrawals will have a $2.50 fee.
There’s no fee for adding funds to the card through direct deposit and cash reloads will cost up to $3.95, depending on where you are reloading the card. The card itself is free through Amex’s website or $3.95 to purchase in retail locations.
There’s a $7.95 monthly fee for the Serve card. If you spend more than $800 per month on the card, you’ll be ahead of the game with the cash-back rewards.
2. Starbucks Rewards Visa Prepaid Card
The Starbucks Rewards Visa card lets you earn Starbucks Rewards on every purchase. You’ll earn one star for every $10 you spend. You can redeem the stars at Starbucks to get free drinks, food, or other items. The stars you earn won’t expire as long as your account is active so you can save as many as you want to get higher-priced rewards.
The Starbucks prepaid Visa has no monthly or annual fees and doesn’t charge any reload fees. The main disadvantage compared to other cards is that you can’t withdraw cash through an ATM.
If you’re a Starbucks fan and aren’t concerned with being able to withdraw cash from your prepaid card, this is a hard one to beat.
3. Kroger REWARDS Prepaid Visa Card
The Kroger REWARDS prepaid Visa is another rewards card, this time for Kroger shoppers. You’ll earn points for every purchase, which will convert to a coupon that you can use at Kroger.
All purchases earn 1 point per dollar, purchases at Kroger earn 2 points per dollar, and if you buy Kroger store-brand items, you’ll earn 3 points per dollar spent. When you accumulate 1,000 points, a $5 Kroger coupon will automatically get applied on the card for your next purchase in the store.
You can load up to $5,000 on the card through direct deposit for free or up to $1,000 cash at Krogers for $3. A $10 “signing” bonus will be applied to your card for signing up for direct deposit as well.
There’s no credit check required to sign up and Kroger offers a free mobile app to manage your card. The monthly fee is $4.95 so if you spend enough to earn 1,000 points in a month, the $5 coupon will offset the cost of the card.
4. 24k Prepaid Visa RushCard
The 24K Visa RushCard doesn’t need a credit check and there’s no minimum balance required to maintain your account. The funds on the card are protected by Visa’s Zero Liability policy so even if you lose your card or it is stolen, your funds are protected.
The RushCard offers online bill payments as well as real-time alerts for activity on your account or when the card is getting low on funds. The real-time alerts are a great fraud protection feature since you’ll know immediately if someone is using your card without your permission.
You can reload the card through MoneyGram, Western Union, and direct deposit from other institutions like this bank. You can either pay a $7.95 monthly fee for unlimited transactions or if you only use the card occasionally, you can pay $1 per transaction instead.
5. FamZoo Prepaid Debit Card
The FamZoo prepaid Mastercard offers a unique spin on prepaid cards. Their prepaid cards are meant to be shared with members of your family, particularly kids. The goal is to help teach your kids how to manage their money properly.
These cards have less risk associated with them than a typical checking account would. You can create parent and child roles that limit access and features on particular cards. You can transfer money between cards and even set up recurring transfers, to manage your child’s allowance, for example.
Parents can lock specific cards for fraud protection or to control access to the funds available. You can even tie chores to rewards and penalties on your kids’ cards.
A paid FamZoo subscription (at $5.99 per month) provides you with four cards. You can add more for $2 each. There’s no reload fee for direct deposit and the fee for cash reloads varies, depending on the provider. There’s no fee to transfer funds between cards.
How to Choose the Best Prepaid Cards for Your Needs
The cards we’ve listed all have advantages and disadvantages. The best prepaid cards are the ones that suit your particular needs and lifestyle. If you want to put your kids on the right financial path, the FamZoo option might suit you better.
The key to picking the best prepaid card is to look at the fees and the benefits to figure out which combination suits you best. Most prepaid cards charge a monthly fee and those that don’t have other limitations. But if you choose wisely, the fee can be offset by your use of the card, making it free or even profitable to use.
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