Which is better for you; Debit or Prepaid Cards?

If you usually try to stick to using your debit card, you may wonder why anyone would use prepaid cards.  What is the difference between the two cards?

First, let’s look at the debit card.  In order to have a debit card, you need a bank account.  Your debit card often has a credit logo on it so you can take advantage of making purchases without having to deal with the interest charged on the credit card account.  Debit cards are accepted in most places because of the credit logo.

The prepaid card or prepaid debit cards works in a different manner.  First, you have to put money on the card.  You can make an Internet payment to your prepaid account or you can go to many stores that can take care of this for you as well.  Some prepaid cards can be reloaded over the phone too. 

As a credit card, you are not held responsible for fraudulent charges made to your account over an initial fifty dollars as required by law.  You can earn reward points for making purchases with your prepaid credit card.  Some prepaid card companies offer air miles for your transactions.  If you use the card regularly, this can add up quickly.  Others allow you to use the reward points to buy things from their catalog of merchandise. 

A few prepaid credit card companies even offer a cash back program for your purchases.  The more you spend, the more you make.  If you use your debit card because you want to avoid overspending, consider using prepaid cards.  You have the protection of a credit card and you can earn rewards as well.  Another reason to consider the prepaid card is that the company will report your charges to the credit bureau and you can build your credit history. 

With technology today, you can quickly and easily add more funds to the prepaid card.  The key is to find the right prepaid credit card company and you can take advantage of all the benefits.