Prepaid credit cards for students can help to keep finances in check
Prepaid top up cards are ideal for students
Keeping track of money as a student can be difficult. There are lots of bills that need paying, as well as grocery shopping, book buying and evenings out. For many students, this is their first time away from home, and can be a lot to take in. If they have never had a credit card of any kind, or any sort of overdraft, they can get a little too excited, and may end up making a mess of their credit rating before they have even finished their education. One way that parents can help students with their finances is through the use of a pre-paid credit card. Parents and students can both top up their card, but will set a limit on the amount that they can spend. This can help students to take more control of their finances while still buying what they need to study and general living expenses.
Are prepaid cards the best deal for students?
Students need a great deal of help with budgeting and also need a card which is flexible and able to offer them the best alternatives to getting into debt. Many students find that they fall into debt with their bank, and may even have to struggle on with an unauthorised overdraft, which can lead them deeper and deeper into debt. A student friendly prepaid credit card will help students to keep a closer idea on what they are spending, and can be used for things such as the weekly grocery shop, or for book purchases at the beginning of each term. Parents can also help by budgeting their assistance to their student, adding money each week to tide them over.
How much will it cost to use the prepaid card?
What do pre-paid cards cost?
The card can be helpful to students, but it does come at a cost. Unlike bank cards and cheques, which are provided free by the bank, the prepaid credit card has charges which will need to be covered. In most cases, the card will require a £10 deposit to set up, and there will also be charges for use, including ATM withdrawal charges and even charges for going abroad. There may also be other costs for failure to use the card, which can be left in a drawer over the summer, for example. All of these things mean that parents need to be careful when they are considering whether to give their children a prepaid card before they start at university.
Where can I find prepaid cards?
There are several companies who supply prepaid cards, some of whom have students specifically in mind, and others who are just offering the card with no requirements for the user. Researching the different cards may give you a clearer idea of which is the best for the student, and which is likely to be the most useful to them. Some of them have higher withdrawal rates, for example, while others have lower set-up costs, so you should consider all of the options available, and only select one when you are confident that it is right for you.