If you secure a line of $200, you can spend $200, pay it off, and spend it again as many times as you want.ДЄs we mentioned above, some people have trouble getting access to traditional bank accounts for various reasons, and some people donвЂ™t trust banks.

Secured credit cards offer a revolving amount you secure with an initial deposit, and then you can spend up to that amount as many times as you want to assume you pay it off.

If you deposit $200, you have that to spend before you need to reload more. Like a debit card, prepaid cards allow you to spend the exact amount of money that you have, and thatвЂ™s it. Prepaid debit cards are also different than secured credit cards because they are not lines of credit. Gift cards can be refilled, but are usually viewed as a one-use thing, whereas prepaid debit cards are meant to be reused, and can even be loaded via direct deposit. Unlike a gift card, many prepaid cards offer an account associated with a specific refillable card (though itвЂ™s not a traditional bank account or checking account) that comes with a mobile app and online bill payment options. Prepaid debit cards are a little more sophisticated than the gift cards you can buy in the grocery line (though many prepaid cards are also available to purchase at stores like Walmart). Prepaid credit cards offer more freedom than cash because you can make online bill payments or online shopping purchases and they are safer than carrying around a wad of cash all the time. All of the big providers-Visa, MasterCard, American Express- offer at least one prepaid option, and many even allow you to get direct deposits onto your prepaid card. Basically, you load money onto the card via cash, check, or another bank account, and then the card functions like a normal debit card. Regular Debit Card?ДЄ prepaid debit card is different from a regular debit card because it is not linked to a checking or savings account, and doesnвЂ™t require a bank account at all. While this number is declining and access to fair and equal banking is growing with awareness and technology, it is still important for those who are unbanked to have the safest and most inexpensive options possible. For many during the pandemic, it also meant difficulties receiving government aid. Those who donвЂ™t have bank accounts face higher fees, lack of credit, and lack of methods to save money, which can stifle financial growth, and cause some to fall victim to predatory lenders with interest rates as high as 500%. This can be a result of many factors вЂ“ lack of access to banks, monthly cash flow problems, lack of social security number and/or ID, or simple distrust of banking institutions. Over 6% of households in the United States, totaling about 14.1 million Americans are unbanked, which means they do not have a bank account. This content has not been provided by, reviewed, approved or endorsed by any advertiser, unless otherwise noted below. We may, however, receive compensation from the issuers of some products mentioned in this article. You can trust the integrity of our balanced, independent financial advice.

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