Prepaid credit cards are a ripoff? Are you serious?

Question

I've been reading some answers on here about prepaid credit cards and some want to say they are a complete ripoff. Oh, so credit cards aren't? They say this because of the fees. I could get a Visa Wired Plastic for $9.99 one time activation fee and $3.95 a month for maintenance. That's it. A measly $48.00 a year. Only $3.95 to reload. Same with Western Union prepaid Mastercard. Okay, why not buy a pair of $100.00 shoes, 7% sales tax, which would be $107.00 with a prepaid. With a regular credit card, they will charge something like 20%, plus they also have a minimum you pay every month. That would be $107.00 plus 20%, all to the credit card company. See the difference? Now who's the ripoff?

Answer 1

I definitely believe in Prepaid cards. I think they are a great way to keep your spending in check and allow yourself to make purchases, that only a credit card allow.

I think prepaids were a smart choice!

Answer 2

Okay, you said for a measly $48.00. That is IF you only load the card one time per year. If you reload it every month, you have just added $47.40 a year. There are lots of cards out there that have less than a $95.40 annual fee. Also, as to the interest charge, that is ONLY if you carry a balance. If you pay the bill in full then you are not charged interest. Since you are doing prepaid cards this should be no problem.

Also, Prepaid cards do not report to any credit reporting agency. So they do not help your credit history at all. A good history will really help when you look for bigger purchases such as a car or house.

Now, nothing anyone here says is going to change your mind(and not trying to). But it is just something to think about.

Answer 3

It would depend on what you're trying to do with it. If you're trying to build credit, then it's not going do you any good because it doesn't report to the credit bureaus. But it does help if you don't have a bank account and you need a debit card, or if you're wanting to put away some extra money to use at times. I have a Wired Plastic card myself, in addition to having a several credit cards and a debit card through my bank. To eliminate the $3.95 load fee, I simply have some of my paycheck direct deposited to it. The monthly fee is a small price to pay especially when some banks charge you way more if you don't keep a certain balance. I don't think it's a ripoff at all, it just depends on how you use it.

Answer 4

Wow dude, you are way off. If you have a credit card that doesn't have an annual fee, you can buy that pair of shoes for $107 and then send $107 when you get your statement and pay it off with out having to pay anything. Even if you let the balance carry over and the interest rate is 20%, that interest rate is for the entire year!!!! If it takes you a full year to payoff shoes, you shouldn't have bought them in the first place.

Basically you are paying for your shoes with Cash before you buy them with your credit card. If you load your card for $3.95 and pay a maintenance fee of $3.95 every month, you're paying $48 a year for a bank to hold onto your money... that's a horrible horrible deal. why wouldn't you take that money you were going to load on a credit card and go open a savings account that has a debit card.... same thing and you earn interest on your own money....

Answer 5

If I charged $107 on my credit card I'd pay $107 at the end of the month, costing me -0-. If I didn't pay it off and if my interest was 20%, I'd pay 1.76 in interest the next month.
The reason prepaid cards are good for some is that it's more secure than carrying cash, they don't qualify for a good credit card, someone is giving you money or allowance, good for budgeting - and the cards have the same convenience as a debit or credit card. They would not be for me because I pay off my card off every month. They are two different products for different purposes. Comparing a prepaid credit cards with a conventional credits card is like comparing apples and oranges. They are both fruit but completely different fruit.

Answer 6

If you pay off the entire balance on a regular credit card every month (like you are required to do on a charge card), then there is usually no interest.

If you do not, then both credit cards and prepaid cards are ripoffs. There are other ways to borrow money for much less than 20% interest.

Answer 7

You wrote: "I could get a Visa Wired Plastic for $9.99 one time activation fee and $3.95 a month for maintenance. That's it. A measly $48.00 a year. Only $3.95 to reload."

I'm trying not to laugh out loud.

I can get an American Express card for $55 a year, and have a $100,000 credit line.

Answer 8

I agree with you that they have their place in our society.
But a high roller, big talker like Stuart would not know about us common folks. Stuart, we are trying not to laugh at your arrogance.

Answer 9

So many experts, so little time.

Answer 10

I think it dose not matter. Let people think what they want to think.