Interesting inquiry, can pre-paid cards improve our Debt Management and thus prevent us running up new Credit Card Debt? Are they a more viable answer to credit cards? Before we respond to these queries let us take a look at just what a pre-paid card is.
Put incredibly simply, it’s a card that you can bung any quantity of cash on and use whenever you obtain anything. Once you’ve used the quantity allotted on the card you can not exceed it. You can put cash onto it by the use of all the standard methods; ATM, using the web, on the telephone or even by method of text messaging. On the other hand you can go to your regional post office or bank and even many non finance suppliers and find preloaded cards.
A pre-paid card can assist us to budget well, enabling us to allocate funds for specific purposes; the weekly food allowance, or petrol for instance. Also as David Roger, managing director for the Debt Foundation charity suggests, it can help prevent us wrongly using that overdraft once more and going in to the red.

In theory it must make it a lot easier for each and every one of us out there who are just a bit too friendly with our credit cards. After all anything that diminishes the danger of running up new Credit Card Debt has to be worth a try hasn’t it?
Another good detail is that they’re not linked back to our bank account. This means if a certain mean little person steals our card and tries to take on our identity then they won’t have access to all our precious cash. Furthermore if they were to try and use it via the web they wouldn’t be able run up expensive bills.
Then again before you get all excited and rush out there to get one, there are some things to keep in mind. Firstly the most obvious; you can only load it with income that you already have. Appears blatantly apparent but it is very easy to forget that that piece of plastic in your hand is not an endless source of credit that we can ignore when the bill comes through. Visualize the embarrassment at the checkout if you try to purchase something that is more than the cash existing on the card! A significant tip to memorize; only load it with what you can manage to pay for.
And there are several fees incurred, monthly payments for example and a few even have inactivity costs.

So, yes a different means of Debt Management they might be, but what other options are there, other than not spending what we haven’t got? For starters we might help our finances by being stricter with ourselves. We really should try to curtail those impulse purchases that we later on regret, but still have got to pay for.

Having a practical budget and keeping to it goes a good distance towards preserving a vigorous bank balance and reducing those worry levels.

If we are in debt up to our eyeballs then budgeting is a must. We can look at possibilities such as Debt Consolidation for one, so as we won’t feel so overwhelmed with it all. By placing all those debts into one pot aids us to see what we’re dealing with, not only that but Debt Consolidation will enable us to have one reduced monthly payment.
Whatever we opt for the bottom line is, never get into more debt than we can control.

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