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A family member has recently declared bankruptcy and wants to get a prepaid credit card that she can use in situations where she can't pay by cash or check. (I understand that she should get a secured credit card to start rebuilding her credit -- this is an interim measure.) A card that she could reload would be best.

I was surprised to find so few questions or answers here about prepaid cards. I thought this would be a FAQ. Could anyone point me to a post or website that compares such cards -- I assume there is a significant variation on fees?

If she will be able to open a new bank account so soon after filing, I assume this is a better option than prepaid, so long as they will give her a visa or mc branded debit card. Fees aside, are there any disadvantages to debit vs. prepaid?

Thanks in advance for your help.

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Really, there are several threads on bluebird, paypal, netspend and Mango prepaid cards.

Bluebird is probably the best WRT fees.

http://www.nerdwallet.com/prepaid/

Don't have any recommendations on prepaid cards, however, opening a new bank account and getting a debit card should not be an issue unless she is in chexsystems for overdraft, fraud, etc.

Debit would be a better option IMO as you should be able to find a bank with no fees at all. Most prepaid has at least some sort of fees. She will soon be swamped with credit card offers from high risk/scam lenders ($95 account opening fee, $20 monthly maintence, 25% APR) stuff like that. Hopefully she is smart enough to toss all of these offers in the trash and not get right back where she started.

I think that vipercon is probably right that checking account with debit card is the way to go. My concern about using debit cards for day to day transactions is the risk of someone fraudulently grabbing the card number and using it. Although legal liability is apparently the same ($50 max and, for most cards $0), with debit card, you have to prevail upon the bank to put money back into account and any delays in doing so can result in bounced checks, etc. (not to mention the anxiety of having account cleaned out).

The nerdwallet link was interesting, although bluebird appears twice with vastly different fees listed. I'm sure there is a reason, but didn't take time to figure out why.

Serve from AMEX seems like an interesting alternative. As far as I can tell, so long as you load from a checking account, there are no fees.

In general I think it's best for your family member to stay far away from these new debit products and stick with the checking account linked debit card idea. The good part about these debit cards is they don't have any overdraft fee. But the bad thing about them is a lot of them have a myriad of other fees, The per swipe fee is particularly disgusting. If family member is good with balancing a checkbook then I see no reason why she needs to lay with those dogs.

You also won't find many ppl here who use these cards because they have to. The cards are marketed to the less financial savvy, low wage earners and or disenfranchised segments of society.

The prepaid cards also don't have the same consumer protections that bank account debit cards have .

thecave said:   Serve from AMEX seems like an interesting alternative. As far as I can tell, so long as you load from a checking account, there are no fees.

And there is no credit check with AMEX Serve, which is a huge hurdle removed. I helped a friend, who filed for bankruptcy, by telling her about this card. Getting the card was easy and it made her life so much easier.



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