Prepaid Cards Can Prevent Holiday Over-Indulgence
December 04, 2017
The holidays make it difficult to stick to a budget, but prepaid cards can help prevent overspending.
Gift giving, holiday parties, and travel can all overwhelm a budget quickly, but prepaid cards can help avoid post-holiday bill blues. Savvy holiday shoppers from different backgrounds are recognizing the benefits of prepaid cards and choosing them as an alternative or even a supplement to other banking products.
Prepaid cards are similar to debit cards, but funds are preloaded into the specific card account instead of being drawn from a shopper’s primary checking account. That means shoppers can set a budget for the season and actually stick to it by preloading a card that makes a budgeted holiday spending amount a hard limit. No overdrafts or credit lines will tempt you to go beyond your means.
According to polling from the Pew Charitable Trusts, more than half of all prepaid cardholders cite the ability to budget as one of their primary reasons they use the product.
With prepaid cards, holiday revelers can avoid overspending and easily track all of their purchases. Since they cannot spend more than what’s loaded onto the card, gone are the stressful end-of-the-month balance checks. According to the same Pew poll, two-thirds of cardholders cited this as a major reason they choose prepaid.
And if shoppers stay under-budget, they can save those funds for the future. Funds loaded onto prepaid cards won’t expire for at least five years, meaning they can start planning for those larger gift purchases next year.
Of course, if a shopper does happen to see that perfect gift that’s slightly over budget, prepaid cards are easily reloadable and funds are immediately available. This way shoppers can stretch their budget without opening the flood gates.
With the holiday season upon us once again, the best gift shoppers can give themselves is the peace of mind knowing they are on steady financial ground. Prepaid cards are a tool they can use to ensure a happy holiday season.
Check out our infographic on the benefits of prepaid for holiday shopping.