Go Direct With Prepaid Credit Cards

Go Direct With Prepaid Credit Cards

by Henry Switzer

A credit card is a basic requirement in today's world. Almost anything is possible when you have one, but without it, some things are definitely not possible. In order to take advantage of car rentals and even hotel reservations they are required. In fact there is little in life that does not take or require the use of one anymore, including shopping online.

Of course, it is not exactly easy to obtain a credit card either. This is especially true if you have bad or no credit. Maybe you were just trying to avoid getting one altogether to avoid the debt? The good news is that there is an answer, prepaid credit cards. With this method, you do not have to deal with credit at all. In fact, the credit bureaus never even come into the issue. You can still get a card, a prepaid one, whether you have good, bad, or no credit at all.

Why should you consider prepaid as an option? Well essentially, they are less hassle and so much easier to manage than traditional credit cards. But, like most things in life, they have their disadvantages and advantages.

Lets have a look at the advantages first. First, debt will not become a factor with prepaid credit cards. You have a specific balance on these cards, what you decide to deposit. You can never spend more than is on the prepaid card. Once you use the balance, it is finished, unless you have a reloadable card and deposit more money.

Second, you do not have to deal with interest rates. Unlike traditional credit cards, prepaid ones do not require any type of interest rates; this is because there is no balance outstanding. This saves you both money and worries.

Third, they both work very similarly. Traditional and prepaid credit cards work in the same general way. When you are shopping and ready to check out, just give your card to the cashier and the amount of the purchase will be deducted from the balance. It is as easy as that.

Some disadvantages to having prepaid credit cards include:

They do not carry a credit limit over what you have deposited. If you need to make a purchase that is more than the balance on the card, you will not be able to do so. Furthermore, they may not be accepted in certain establishments. It is important to take a look at all policies of any retail establishment to ensure that they will indeed honor your prepaid credit card.

Prepaid credit card companies do not always report to credit bureaus, so they may not be helping to rebuild or establish your credit. You can still work to rebuild or establish your good record at the same time. Some prepaid credit cards do still report to the credit bureaus, but in positive ways. This means that if you are making your payments, the credit bureaus will be advised, and see that you are working to rebuild or establish your financial position.