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Prepaid cards work like debit cards with one significant difference. The card is not linked to your checking account, which means you must deposit money onto the card to use it. But, like debit cards, it can be used almost anywhere.
The ability to use the prepaid card as a credit card is one of its most attractive features. Make purchases online and in-store without worrying about your debt obligation. Like credit cards, prepaid cards also offer protections.
Reloadable prepaid cash cards: A reloadable prepaid cash card can help with budgeting when used to pay for designated expense categories. For example, Sarah Saver’s monthly entertainment budget is $80. At the beginning of the month, she loads the card with $80. As the card balance decreases, she will need to slow her entertainment spending. For Sarah to remain committed to her budget, she’ll wait until next month before adding more funds to the card for entertainment expenses.
Gift cards: Prepaid gift cards make the holidays and special occasions stress-free and budget-friendly. They encourage a spending limit and help you stick to it. For example, Martin Money has a holiday gift-giving budget of $150. With ten nieces and nephews under the age of 12, he decides to give each child a gift card valued at $15.
A prepaid card can solve budgeting and gift-giving challenges. Hughes Federal Credit Union offers members Reloadable Prepaid Cash Visa® Cards and Prepaid Visa® Gift Cards.
