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Celebrity prepaid debit cards continue to baffle us here at NerdWallet. They come with high fees and not enough transparency.
Fees, fees, fees
Like any prepaid debit card, the Young Money comes with a lot of fees:
|Domestic ATM WIthdrawal||$2.00|
|International ATM Withdrawal||$3.00|
|Monthly Maintenance Fee||$3.95|
|Card Purchase Fee||$6.95|
|Paper Statement Fee||$2.50|
If you sign up for the Young Money Card, you’ll have to pay the card purchase fee, the reload fee and the monthly maintenance fee no matter what. Those are the inescapable expenditures. Let’s say you sign up and deposit money into your account only twice within the first month. You’re paying a minimum of $20.80 right off the bat! And that’s assuming you don’t need to make a withdrawal or require a paper statement.
The Young Money Card is admirably a little more forthright with the disclosure of its fees than some of the other prepaid cards out there. The terms are easy to find and easy to read; there are no excuses for signing up.
Why do people want prepaid debit cards, anyway?
Prepaid cards target folks with no or bad credit who can’t qualify for most credit cards. Prepaid debit is often seen as a last resort, and many people feel they have no other options. These cards may be appealing in dire straights as they offer an alternative to cash and a means of paying for Internet purchases. However, the fees are usually brutal, and there are better options.
If your credit leaves something to be desired, don’t immediately discount credit cards. Not only can you qualify, but you can qualify for a card with halfway decent terms. Our favorite credit card for bad credit comes from Orchard Bank. The Orchard Bank® Classic MasterCards’s annual fee is $39 - $59 the first year, $35 - $59 per year thereafter*.
Understandably, annual fees can be huge deterrents for potential applicants, but you’ll ultimately save money with Orchard. A Young Money cardholder will pay $47.40 in monthly maintenance fees for a year of use. And if that person makes but one deposit a month, he will fork out $59.40 in reload fees. Without taking into consideration withdrawals, statements or replacements, we’re already at over a hundred bucks for a single year.
Alternatively, visit a local credit union. They generally offer fair cards for limited credit as well as checking accounts that won’t come with a lot of fees.