When your teen reaches a certain age, you’re probably ready for the bank of mom and dad to close. Soon. When the time comes to give your teen more financial independence, especially if they’re earning their own money, consider a pre-paid debit card. These cards are a great alternative to a debit card tied to a traditional checking account. Here’s how pre-paid debit cards can benefit the teen’s transition into adulthood.
Great for parents
Pre-paid debit cards are available at most local retailers, as well as from your credit card provider website. Many credit unions and banks also offer pre-paid cards. Using a pre-paid card makes it easy to keep an eye on your teen’s spending. You can decide together how much money to add to the card and the types of acceptable purchases. Go online together to check balances and review transactions. This also becomes an opportunity to talk to your teen about spending habits. And if your teen doesn’t follow the rules, you can skip adding funds!
Great for teens
Pre-paid debit cards encourage financial responsibility. Teens may still need to borrow the car, but they will have their own card to buy gas. Having a pre-paid debit card gives your teen a better understanding about budgeting and making important financial decisions.
The card is likely accepted at millions of in-person and online retailers around the nation, so they may never need to worry about cash. But if they want pocket money, teens can make cash withdrawals at participating ATMs. If enough money isn’t available, the transaction won’t go through. As a result, your teen must think about what and when to spend.
Ideal for anytime spending
In the end, it’s hard to go wrong giving a teen a pre-paid debit card. The cards are a convenient, low-risk tool for helping your teen budget and manage spending. And if things don’t go as planned, you’ll know about it!
The advice provided is for informational purposes only.
Article provided by Local Government Federal Credit Union