Finding the best prepaid debit card was once a task traditionally reserved for people who had trouble opening a bank account. Today, prepaid debit cards are becoming much more versatile. Many families and college students are regularly using them to manage their finances. If you have poor credit and can’t get a credit card, for example, getting a prepaid card is a good way to make purchases online.
With the rise of new fees on traditional checking accounts, the prepaid cards are closer to parity with more traditional accounts. Competition in the prepaid debit card space is increasing, driving down cost and driving up service. To help you keep up on the changes within this space, I’ve compiled a list of the top prepaid cards and will discuss each in detail.
The Simple Dollar’s Top Picks
Here are the 5 best prepaid cards of 2014:
- PayPal™ Prepaid MasterCard®
- READYdebit Platinum Visa Prepaid Card
- AccountNow® Prepaid Visa® Card
- ACE Elite™ Visa® Prepaid
- American Express Serve®
What Makes These the Best?
The top prepaid debit cards excel in different areas but also hold many common features. Here are some of the reasons why these cards are good choices:
- Convenient card loading options
- Flexible ways to spend and pay bills
- Minimal monthly fees
- Free direct deposit
- Retail networks or online connections
- Widely accepted
- Ability to send money to friends and family online or via mobile device
The cards listed below are the top options to choose from this year. There is no clear winner when it comes to picking one prepaid card over another because it ultimately depends on your own preferences. By reading through the details of each card, you should get a good idea of which will be the best for you.
PayPal™ Prepaid MasterCard®
Because PayPal™ is the authority of online payments, it stands to reason their card is one of the best prepaid debit cards on the market. While the card costs $4.95 per month, it offers unlimited signature and PIN purchases as well as cash back from select specialty stores and restaurants. It also offers the advantage of transferring money between your card and your PayPal account.
Theoretically, it is possible to link other prepaid cards to your PayPal™ account, but I’ve heard of many problems associated with the difficulty of linking them. In addition to your PayPal™ account, you can add money with direct deposit, or at over 130,000 NetSpend Reload Network locations nationwide. Fees may apply at these locations.
PayPal™ Prepaid MasterCard® — Snapshot
- Free direct deposit – get your paycheck and government benefits up to 2 days faster.
- Instantly transfer money from your PayPal Account to your PayPal Prepaid MasterCard!
- Get account alerts on your mobile device or download our App to check your balance and see recent transactions
- Earn Cash back rewards from specially selected stores, restaurants and more
READYdebit Platinum Visa® Prepaid Card
Despite this card’s $14.95-per-month fee, it makes the list of best prepaid debit cards for its premium features. The READYdebit Platinum Visa® Prepaid Card gives you the freedom of Visa, plus mobile account access, credit score tracker, and the Visa’s Zero Liability™ policy, which means you’re not liable for fraudulent charges made with your card or your account information.
The credit score tracker is a useful feature for someone getting back on their feet and looking to eventually make the switch over to a bank checking account. There is also an exclusive rewards program and an emergency cash access program to get you cash in a pinch.
Like all the other best prepaid cards, this one lets you load money on your card for free with direct deposit, or at any one of several convenient retail locations where small third-party fees may apply. The READYdebit Platinum Visa® Prepaid Card rounds out its premium offering with free online bill pay and free online check writing.
The READYdebit Platinum Visa® Prepaid Card — Snapshot
- Exclusive Rewards Program
- Free Credit ScoreTracker1
- Easy Mobile Account Access and Text Alerts
- Easy Online Bill Payment & Check Writing
- Free† Direct Deposit %u2014 paycheck, benefits, tax refunds
- No Credit Check, No Overdraft Fees or Balance Minimums
- Reloadable up to $10,000 Max Balance
- Deposit is fully FDIC insured
AccountNow® Prepaid Visa® Card
The AccountNow® Prepaid Visa® Card is potentially the cheapest prepaid debit card around, although it is best for people that only make occasional purchases. You pay a one-time $4.95 activation fee and no monthly fee. However, AccountNow tacks on a $1-per-transaction fee. Those fees can add up if you’re not careful. You may want to use this card like a savings account by letting money accumulate, and only using it for larger, infrequent purchases.
If you think you’ll be making more frequent transactions with your card, the Account Now Gold Visa® Prepaid Card may be a good choice. It carries a $9.95 monthly fee but doesn’t charge any transaction fees.
AccountNow® Prepaid Visa® Card — Snapshot
- $0 Monthly Fee
- No Minimum Balance
- Free Direct Deposit and Online Bill Payment
- Now with Purchase Rewards
- Perfect for Occasional Usage
ACE Elite™ Visa® Prepaid Card
The ACE Elite™ Visa® Prepaid Card is a very versatile card in that it has three separate fee plans.
The pay-as-you-go plan carries no monthly fee, but instead charges $1 for signature transactions and $2 for PIN transactions. This plan is good for very limited transactions each month.
If you plan on more than 5-10 transactions per month, then pay up for the Fee Advantage plan. For $9.95 per month the Fee Advantage plan includes signature and PIN transactions at no extra charge.
If you can get your paycheck direct deposited, then you are eligible for the Direct Deposit Fee Advantage plan. This plan knocks the monthly fee down to $5 if you direct deposit $500 or more each month.
ACE Elite™ Visa® Prepaid Card — Snapshot
- Enroll in direct deposit today — receive your account number immediately.
- Need your money before payday? Get paid up to 2 days faster with direct deposit.*
- Withdraw up to $300 with no fee daily at ACE Cash Express locations with direct deposit.*
- Mobile account access — available on GooglePlay and Apple App Store.
- Transfer money to another ACE Elite cardholder with no fee.
- Earn cash back on your everyday purchases through Payback rewards — get Special Offers and account credits when you use them.
American Express Serve®
The American Express Serve® may be the best prepaid card because it is low cost and provides easy ways to avoid fees and add cash. The $1 monthly fee is already very low, but the fee is waived if you use direct deposit or load just $500 onto your card each month.
Moreover, you can load cash for free at CVS and 7-Eleven stores. Most other cards offer large retail networks but those retail partners often charge their own fees to add cash at their locations.
This card is also great for families. You can set up sub-accounts for your kids and set spending limits for them. The card also has a reserve function, so you can set aside money each month for a large purchase or family vacation.
American Express Serve® — Snapshot
- Get a $50 credit after receiving $250+ twice via Direct Deposit by 6/30/14.* Enroll in Direct Deposit to get your paycheck in your American Express Serve Account on payday.
- Enjoy American Express service and security 24/7. Shop online or off and get access to membership benefits like Purchase Protection.
- Add cash for free across 15,000 CVS/pharmacy® stores and participating 7-ELEVEN® locations.
- Free ATM withdrawals at over 24,000 ATMs nationwide.
- Use the Mobile App* to deposit checks on-the-go, manage your money, easily pay bills and more. *Terms, conditions and exclusions apply.
Best Prepaid Cards Comparison
Take a close look at the table below to get a better understanding of which prepaid card is best for your situation.
Who Should Use a Prepaid Debit Card?
For now, even the best prepaid cards will come up short when compared to free checking account options. However, there are several instances when a prepaid card makes sense.
You should consider getting a prepaid debit card in these four cases:
- If you can’t open a free or low-cost checking account. People who have a history of not paying bank fees or overdrawing their account will get flagged in ChexSystems, which is a special credit system that banks use.
- If you don’t like certain bank fees, like overdraft or service fees. Most banks offer some free checking options but, if you overdraft your account often, you’ll rack up fees.
- If you don’t want online purchases to have any link to a bank account or credit card. You can limit the amount of money on the card so, if anyone got ahold of your information, your downside is limited to what’s on the card instead of your entire bank account!
- If you want to use a prepaid card to issue your kids gas money, allowance, or college-spending cash. This ensures your kids don’t go rogue and overspend on the family credit card.
If you do not fit into any of the categories above, then your best bet is to sign up for a free or low-cost or free checking account.
If you’re someone who has bad credit and you’re looking to build it back up, you may be better off with a secured credit card in addition to a prepaid card. I plan on covering secured credit cards in the near future so that might help with your decision. In the meantime, there’s no problem with owning a prepaid debit card as long as you plan on using it to offset any fees you may have to pay.