Interesting problem, can pre-paid cards assist our Debt Management and thus prevent us running up extra Credit Card Debt? Are they a more viable answer to credit cards? Before we answer these queries let us have a look at precisely what a pre-paid card is.
Put extremely simply, it’s a card that you can bung any sum of cash on and use whenever you pay for anything. Once you have used the sum allotted on the card you can’t exceed it. You can put money onto it by all the normal methods; ATM, by going online, on the telephone or even by process of text messaging. Then again you can go to your local post office or bank and even some non finance sellers and attain preloaded cards.
A pre-paid card can help us to budget efficiently, enabling us to allocate cash for specific reasons; the weekly food allowance, or petrol for instance. Also as David Roger, managing director for the Debt Foundation charity suggests, it can help prevent us erroneously using that overdraft yet again and going in to the red.

In theory it ought to make it better for every single one of us out there who are just a little bit too friendly with our credit cards. After all anything that eases the hazard of running up extra Credit Card Debt has to be worth a try hasn’t it?
Another good thing is that they’re not linked back to our bank account. This means if a particular nasty little individual steals our card and tries to take on our identity then they will not have access to all our precious funds. What’s more if they were to try and use it on the web they would not be able run up exorbitant bills.
Yet before you get all excited and run out there to get one, there are a few things to bear in mind. Firstly the most obvious; you can only load it with money that you already have. Would seem blatantly plain but it is so easy to fail to remember that that piece of plastic in your hand is not an limitless stock of credit that we can discount when the statement comes through. Consider the embarrassment at the checkout if you attempt to obtain something that is more than the assets to be had on the card! A key aspect to commit to memory; only load it with what you can pay for.
Furthermore there are quite a few charges incurred, monthly charges for example and a lot even have inactivity costs.

So, yes another means of Debt Management they may perhaps be, but what other options are there, other than not spending what we have not got? For starters we may help our finances by being stricter with ourselves. We will need to limit those impulse buys that we soon after regret, but still have to pay for.

Having a sensible budget and keeping to it goes a long way towards keeping a fit bank balance and reducing those tension levels.

If we are in debt up to our eyeballs then budgeting is a must. We can look at options such as Debt Consolidation for one, in order that we never feel so overwhelmed with it all. By placing all those debts into one pot helps us to see what we’re dealing with, not only that but Debt Consolidation will enable us to have one reduced monthly payment.
No matter what we opt for the bottom line is, never get into more debt than we can manage.

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