Switching from Credit Cards to Prepaid Debit Cards in the New Year

prepaid debit card from CFSC

With the new year approaching, now is a great time to set goals and get your finances in order. One of the biggest ways people fall off track with their finances and get into trouble by overspending their monthly budget is through the use of credit cards. Even if you have credit cards currently, you can eliminate the pitfalls that come with them by switching to a prepaid debit card from CFSC.

We’ve compiled an overview of why switching to a prepaid debit card in the new year can drastically impact your budget for the better.

Cons of Credit Cards

Interest rates that skyrocket your purchase amounts

As you well know, with credit cards come interest rates, and they can often be very steep. Suddenly, your purchases are costing you much more than the amount on the register at the store.

Interest rates on purchases made with credit cards add up quickly, and before you know it, you have so much more to pay back than if you’d simply purchased with a prepaid debit card. For instance, if you have an interest rate of 24%, your $100 grocery bill just became $124. Why spend more for the same product?

Easy to overspend

Partly due to interest rates and partly because of easy access to funds at a moment’s notice, credit cards make it very easy to overspend. This causes heartache and turmoil when those credit card bills come in, and you find you’re stretched too thin to pay them – or perhaps you even have to grab another credit card to pay the bill, adding even more cost to the scenario.

When you use a prepaid debit card from CFSC, you can rest easy knowing you aren’t going to wind up with a bill at the end of the month, and you aren’t spending money you don’t have.

Increased debt-to-income ratio

Have you ever wanted to buy a car? A house? Get a personal loan? But as soon as you applied, you were declined due to debt-to-income ratio?

When you have credit cards, you’re increasing the amount of debt you have. And when you are in need of a loan, the more debt you have, the less likely you are to be approved. By switching to a prepaid debit card, you lower your debt-to-income ratio and open up more opportunity to go after those things you’re wanting. Bonus: Car, home and personal loans typically come with much lower interest rates than what you’re paying on your credit cards.

How Switching to a Prepaid Debit Card from CFSC can Impact Your Budget for the Better

No interest rates – ever

At CFSC, our prepaid debit cards are interest free. This means you never have to worry about your purchases costing more than what they ring up for at the store. It helps keep your budget in check, it keeps your monthly costs down, and a prepaid debit card from CFSC allows you more financial freedom because there are no hidden fees or skyrocketing interest rates.

A prepaid debit card from CFSC is safer to carry than cash

While a prepaid card acts very much the same as cash, it’s much safer to carry than cash. Have you ever had money that was misplaced, stolen, or lost? When that happens with cash, you can’t get it back. However, with a prepaid debit card from CFSC, if you ever misplace it or it is stolen, simply give us a call or stop by one of our stores for a replacement. You still have access to your funds that you wouldn’t with lost or stolen cash.

3. Load and Unload Your Funds At Your Convenience

Prepaid debit cards from CFSC also come with the convenience of loading and unloading funds* at any one of our convenient 200+ nationwide locations. To find a CFSC near you, check out our interactive map.

Interested in more tips on getting your finances in order for the new year? Check out these blog posts:

* CFSC is an authorized agent of a leading provider of prepaid debits cards. Card usage is subject to qualification, activation and identity verification procedures. Card fees and features are regulated by the prepaid card provider.