Prepaid credit cards are similar to debit cards. To use the card, you must first load value onto the card via direct deposit or a transfer of money from a bank. Every time you use the card, the amount of your purchase is deducted from the balance. Prepaid credit cards are becoming increasingly popular among people who are suffering from debts. Some advantages of these cards include convenience, ease of availability, and guaranteed approval. Prepaid credit cards are issued by most credit card companies, such as Visa, American Express and Mastercard. In this instance, funds are added to a prepaid debit card at a retail location or through an online bank.
Prepaid credit cards are also excellent for individuals who have a hard time controlling their spending and prevent the individual from overspending and getting into credit card debt. If your objective is to establish or rebuild you credit over a period of time, make sure the prepaid card issuer reports cardholder transactions to the credit bureaus namely Experian, Equifax, and Trans Union. Prepaid credit cards are probably the fastest growing section in today's credit card world. They are considered to be the first step in the direction of initiation of a fully fledged credit card.
Prepaid credit cards are very good for paying some bills online and ordering things. These cards are used the same way as traditional credit cards when making purchases.
Credit cards are convenient, but unless you are careful about your spending, you may be shocked when you get your monthly bill. Keep all of your receipts in order to keep track of what you have spent. Credit cards are a privilege that offers many advantages. But they must be managed responsibly.
Credit cards are widely used. Shops and restaurants that accept credit cards have stickers at the entrance or signs posted elsewhere to designate which cards are accepted. Credit cards are one of the financial staples of modern society and with them come the additional necessity of credit debt management. Credit cards allow anyone who qualifies to purchase things that they may not be able to purchase with cash and then pay it off in smaller payments.
Credit cards can be used if you want to borrow a small amount of money for a short time. They are best for people who have the means to pay the money off quickly, and who are good at budgeting.
Copyright (c) 2008 Jay Ta
It's no secret that the holiday season can create sort of a "feeding frenzy" mentality when it comes to spending, especially with credit cards. Retailers know this, and so many of them are more than happy to help out - or so it seems - by offering you the chance to apply for their store credit card. I mean, who wouldn't want to save 15% off the day's purchase? Sounds like a great move, right?
Well, not so fast!
The thing is that store credit cards often carry an unusually high interest rate. In fact, it's not uncommon for store credit cards to come with interest rates as high as 25%. It's ironic, because at that point, the "discount" you get from using the card gets effectively eaten by the higher rate.
Another danger of applying for store credit cards is that just the act of applying for one requires the store to look at your credit report. And as you may know, each time this happens, and inquiry is posted to your credit file. This can potentially be a problem if you're looking to purchase a car or a house down the line, because excessive credit inquiries can lower your credit score.
Let's say for example, you're in the habit of paying all your bills on time (an excellent habit to start, by the way), and you have no existing debts, and so you have a median credit score of 730. This is considered quite a good credit score, and generally would ensure that you'll be approved for loans, as well as receive optimum rates for things like mortgages.
However, let's say you decide to do some holiday shopping for the family. Because of the attractive 10 percent or more discount the stores are offering you as you pay for your purchase, you decide to sign up for the store credit cards at various stores you visit. Unfortunately, each application means an additional inquiry into your credit file, and ends up lowering your median credit store to 680 (these are made up numbers I'm using to illustrate my point, by the way). That's a fifty point difference, which can be a huge deal in the eyes of lenders. And that's on top of paying the higher interest rates on the store credit card itself.
But don't panic. Just remember to ask a few questions before signing up. The next time you're offered a store credit card, find out what the interest rate is, then weigh that against the discount you're getting on your purchase, as well as the problems that an additional inquiry into your credit report can cause for your credit score. You might be better off just skipping the store card and paying cash, or using a student credit card instead.
Both Jay Ta & Keith Adams are contributors for EditorialToday. The above articles have been edited for relevancy and timeliness. All write-ups, reviews, tips and guides published by EditorialToday.com and its partners or affiliates are for informational purposes only. They should not be used for any legal or any other type of advice. We do not endorse any author, contributor, writer or article posted by our team.
Jay Ta has sinced written about articles on various topics from French Vacation, Credit Cards and Hearing Aids. . Jay Ta's top article generates over 1900 views. to your Favourites.
Keith Adams has sinced written about articles on various topics from Credit Cards, Student Credit Cards and Credit Cards. Keith Adams is based in New York City and writes about credit, finance and other topics. You can read more credit articles on his blog,