Comparing Credit card gift cards and pre loaded cards?
October 4, 2016 8:55 AM Subscribe
Oh ye of money sense help me!
I want to have a card that I can use for online services.
I especially like the idea of a card that has a set amount of money that I can use. My primary use would be for Uber or Lyft.
I want to have a card that I can use for online services. I am currently paying down a credit card, so I don't want to use that. I also don't want to use my debit card.
I especially like the idea of a card that has a set amount of money that I can use. My primary use would be for Uber or Lyft.
Disposable cards won't work for a continuing service like Uber.
That leaves me with those Visa cards you can buy as a gift card (which have fees) or what my bank calls "EasyPay Card" which is a prepaid card (which has fees).
How do I differentiate and decide between my options?
What factors should I be looking at beyond the obvious (fees and if a min. balance is required)?
Are there options I'm not considering?
I want to have a card that I can use for online services. I am currently paying down a credit card, so I don't want to use that. I also don't want to use my debit card.
I especially like the idea of a card that has a set amount of money that I can use. My primary use would be for Uber or Lyft.
Disposable cards won't work for a continuing service like Uber.
That leaves me with those Visa cards you can buy as a gift card (which have fees) or what my bank calls "EasyPay Card" which is a prepaid card (which has fees).
How do I differentiate and decide between my options?
What factors should I be looking at beyond the obvious (fees and if a min. balance is required)?
Are there options I'm not considering?
My method: I had credit card debt that I wanted to pay down. I opened a card that had a promotional offer for 0% APR on credit transfers for 18 months (there was a one time fee for the transfer itself, way less than what I would have paid in interest). I transferred my debt to that card and I don't use it for anything else. I use my old card for credit purchases and pay it off in full each month.
The key is that I'm using YNAB to budget my money. I "tell" it that I'm setting a goal to pay off my debt in 14 months, and it automatically calculates how much I need to send each month to meet that goal (I've had a few months when I was low, and a few months when I was able to send extra, and it makes it easy to keep the balance in mind). Using it also makes it easy for me not to overspend on the credit card that I'm using.
If you can change your mindset so that your budget dictates what you're spending rather than an actual preset limit, then you don't have to jump through hoops to find a card that will do it for you.
posted by Kriesa at 9:18 AM on October 4, 2016 [1 favorite]
The key is that I'm using YNAB to budget my money. I "tell" it that I'm setting a goal to pay off my debt in 14 months, and it automatically calculates how much I need to send each month to meet that goal (I've had a few months when I was low, and a few months when I was able to send extra, and it makes it easy to keep the balance in mind). Using it also makes it easy for me not to overspend on the credit card that I'm using.
If you can change your mindset so that your budget dictates what you're spending rather than an actual preset limit, then you don't have to jump through hoops to find a card that will do it for you.
posted by Kriesa at 9:18 AM on October 4, 2016 [1 favorite]
Caveat: I am mostly out of range of Uber and Lyft. We have a nice local lady who will drive you around from bar to bar for five bucks or a six pack. Cheerios on the floor are a plus.
That being said, I got an AMEX Serve (?) card a couple years ago and dumped a couple of hundred bucks on it ostensibly to rent a car, and found out that you get most of AMEX's benefits coupled with having a mediocre credit rating at the same time.
Protip: Use it to check into a hotel. It's not like you're spending quality time there, but the look on the nice kid's face is worth it. "You're getting a suite?"
posted by Sphinx at 9:38 AM on October 4, 2016
That being said, I got an AMEX Serve (?) card a couple years ago and dumped a couple of hundred bucks on it ostensibly to rent a car, and found out that you get most of AMEX's benefits coupled with having a mediocre credit rating at the same time.
Protip: Use it to check into a hotel. It's not like you're spending quality time there, but the look on the nice kid's face is worth it. "You're getting a suite?"
posted by Sphinx at 9:38 AM on October 4, 2016
Best answer: As you are aware, many services (esp. online services like Paypal) will not accept payment via a "prepaid" card that isn't reloadable. Single use prepaid cards aren't assigned to any particular person, and for some reason they don't like that. You can, however, get a prepaid card of any amount that is reloadable and is assigned to you and that satisfies most of the picky service providers. Those have a load fee of about $4 and a transaction fee of $0.50, so it does add dramatically to your costs if you're using it solely for many small transactions.
If your bank is offering you better terms, go for it.
posted by janey47 at 10:04 AM on October 4, 2016 [2 favorites]
If your bank is offering you better terms, go for it.
posted by janey47 at 10:04 AM on October 4, 2016 [2 favorites]
You could just get a normal no fee credit card and keep a credit balance on it. Neither VISA nor your bank is going to complain if you like to keep a a couple of hundred or whatever extra sitting in the card's account.
posted by COD at 10:28 AM on October 4, 2016 [1 favorite]
posted by COD at 10:28 AM on October 4, 2016 [1 favorite]
Best answer: Some online services (esp w/ recurring charges) want the "billing address" of the cardowner for security reasons and to complete the enrollment process.
Some prepaid cards do not have a "billing address".
You might see where this could be a problem. You'll have to search carefully for the right card in certain circumstances.
posted by JoeZydeco at 10:33 AM on October 4, 2016
Some prepaid cards do not have a "billing address".
You might see where this could be a problem. You'll have to search carefully for the right card in certain circumstances.
posted by JoeZydeco at 10:33 AM on October 4, 2016
Best answer: If you're only interested in using this for a few specific services, how about gift cards to those services? You can buy Uber gift cards now. Currently only in stores, but they say they're adding online purchasing soon.
You can buy Lyft gift cards at Starbucks.
posted by mama casserole at 11:36 AM on October 4, 2016 [2 favorites]
You can buy Lyft gift cards at Starbucks.
posted by mama casserole at 11:36 AM on October 4, 2016 [2 favorites]
Response by poster: I appreciated all of the answers!
I wish I had specified better that one of my key concerns was to prevent thieves from being able to access the bulk of my money. I appreciated the budget answers and am looking at transferring my credit balance to a card with an opening 0% That will also incentivise me to pay it down quicker. However, my main concern was to be able to pay for services that want my credit or debit card number on an ongoing basis.
My wife and I have both experienced identity theft. Both happened shortly after having surgery, when the hospital took all of your info and photocopied it. In my case, someone copied my driver's licence and had my account number. They tried to withdraw the entirety of my account. Thank goodness the bank realized that was not normal behavior for me and that the driver's license looked possibly fake. The thief took off and left the license behind. Pulled the police in but they did little except to give me the documentation I needed to alert the various credit bureaus. The bank had called me in, so we immediately shut down the old account and opened a new one so that the account number could not be reused.
Let this be a lesson to readers about account security. Let my post be a lesson to future Askers to include all of the possibly related info, even if it makes your question seem too long! :)
I took onboard the cautions that disposable numbers are not permitted by many services and that many shops and services won't take a card not linked to a person. For now, I'm going with my bank's front loaded card. I was assured that no one can backtrace to my other accounts. Even though I can transfer monies from my account to the card, it is treated as a bill pay in their system. I actually cannot transfer from the prepaid to my account.
posted by Librarygeek at 4:09 AM on November 4, 2016
I wish I had specified better that one of my key concerns was to prevent thieves from being able to access the bulk of my money. I appreciated the budget answers and am looking at transferring my credit balance to a card with an opening 0% That will also incentivise me to pay it down quicker. However, my main concern was to be able to pay for services that want my credit or debit card number on an ongoing basis.
My wife and I have both experienced identity theft. Both happened shortly after having surgery, when the hospital took all of your info and photocopied it. In my case, someone copied my driver's licence and had my account number. They tried to withdraw the entirety of my account. Thank goodness the bank realized that was not normal behavior for me and that the driver's license looked possibly fake. The thief took off and left the license behind. Pulled the police in but they did little except to give me the documentation I needed to alert the various credit bureaus. The bank had called me in, so we immediately shut down the old account and opened a new one so that the account number could not be reused.
Let this be a lesson to readers about account security. Let my post be a lesson to future Askers to include all of the possibly related info, even if it makes your question seem too long! :)
I took onboard the cautions that disposable numbers are not permitted by many services and that many shops and services won't take a card not linked to a person. For now, I'm going with my bank's front loaded card. I was assured that no one can backtrace to my other accounts. Even though I can transfer monies from my account to the card, it is treated as a bill pay in their system. I actually cannot transfer from the prepaid to my account.
posted by Librarygeek at 4:09 AM on November 4, 2016
This thread is closed to new comments.
posted by mskyle at 9:08 AM on October 4, 2016 [2 favorites]