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There are millions of people in America today that do not have the resources to obtain a checking account. Whether they have been in a financial dilemma, bankruptcy or bounced check troubles, there are difficulties to overcome when there is no checking account. These people often have trouble getting credit cards also. If you are one of the many people that do not have access to credit cards or a checking account then a prepaid card might be a good option to consider.
When you don’t have a checking account, there are things that you still will need to be able to do like pay bills, buy groceries or cash checks. There are check cashing services that will cash your payroll check, tax check or social security check, for a fee. Also, without a checking account, you will need to carry all of your cash with you, which is a good way to lose all of your hard earned money. Having cash in your hands will make it easier to spend on unnecessary purchases.
A prepaid card is an excellent option that is increasing in popularity for these people. Not only is it a solution to check cashing and purchases, it is also a good way to efficiently manage your finances. The prepaid cards work like credit cards, but without being attached to a checking account. You put money onto the card in whatever amount that you want and that will be the balance available for spending.
These financial instruments are a good alternative to credit cards; without a requirement to pay interest or transaction fees. You can use your prepaid card at most places that accept credit cards, so it is also convenient. They are one of the best options for those people that have filed bankruptcy also, since it may be troublesome getting a checking account or a credit card.
When using a prepaid card, it can serve as an excellent financial management tool in many ways. One of the ways that it will help manage money is that since it is not attached to a checking account, it will never cause you to incur fees for non sufficient funds by accidentally overspending. With a prepaid card, the balance is the limit and when it is spent, you will have to refrain from additional spending until you refill the card.
The risk of becoming over indebted is eliminated with the prepaid card in comparison to getting a credit card. Credit cards allow the consumer to purchase items now without being billed until later on a monthly basis. This can cause financial trouble for some people when they buy more than they can afford, however, the prepaid card is funded with a specific amount and cannot be used over an affordable amount.
For any of the people who do not have credit cards and no bank account, the prepaid card could provide an essential financial management tool, if it is used properly.