Financial management was a subject that was never taught in school and can be a nightmare for many people. There are way too many temptations to spend, there’s always the newest model cell phone, newest model car and big ticket items like renovating or buying a house. However, there is a way for you to stay in control of your funds, by opting to use a prepaid card. Here are several reasons why prepaid cards can help you manage your finances better:
No Credit Checks
If you have applied for a credit card and the application has been declined, the last thing you should do is keep applying for a credit card. Further credit card applications can potentially damage your credit rating even more. And since credit checks are not involved in applying for a prepaid account, this mitigates that risk away.
Easier to Budget
There is nothing worse than spending money from your main account like there’s no tomorrow only to find out that you have spent way too much by the end of the month. Some people do have a greater need for help in terms of keeping a strict budget. By using prepaid cards, you can top up the card and use it for your spending money, this way you eliminate the risk of expensive overdraft charges, or even worse, unplanned overdraft charges which can be disastrous. Once you have set your budget, transfer the amount from your main bank account to your prepaid card account with your monthly spending. And only use your prepaid account to spend this way you can budget accordingly and you will not end up spending money you have not accounted for.
Separate Your Money
For the purpose of having better financial management, it is advisable that you keep your spending account separate from your main account. By separating these two accounts and assigning your spending money to your prepaid card account, you will know exactly when it is running low. This action alone takes away the risk of overspending and dipping into funds that you have not factored into your regular budget.
In today’s digital world internet banking has become a necessity for the masses. With the use of a prepaid card account, you have instant access to these features the moment you activate your account. This means that not only do you enjoy the ease of use of the prepaid card you can also keep an eye out for what you have used the funds for. And more importantly, you will know how much money you have left so that there are no unexpected shocks lurking.
Improving Your Credit Rating
If you have had your credit card application rejected recently, or you are in the process of rebuilding your credit score, using a prepaid card can be highly beneficial. Prepaid cards are in no way or form connected to a line of credit, owning and using a prepaid card will have no effect on your credit history at all. This can be especially helpful for people who are conserving their credit scores for future financial plans such as property mortgage or a business loan.
Prepaid cards are a much safer alternative to the traditional credit card. As mentioned above, prepaid cards are not linked with any credit facility. In case of a lost or stolen prepaid card, the potential financial damage that can be inflicted on you is limited by what was originally pre-charged on the prepaid card account. Not only will the potential damage not affect your credit score, it will also protect your main account’s balance. And on top of that, just like traditional debit or credit cards, prepaid cards are also protected by a computer chip and PIN security system.
From the benefits summarized above, it is now clear that prepaid cards can greatly assist you with your financial management. Please visit www.transact24.com to learn more about prepaid cards and its benefits.