Table of Contents
- Why Do Parents Want to Get Their Kids a Prepaid Card?
- Is it a Good Idea for Teens to Have Their Own Prepaid Card?
- Whose Money Goes Onto The Prepaid Card?
- Does the Parent Have any Control of the Money?
- What Are Teens Reaction to Having Their Own Prepaid Card?
- Prepaid Cards vs Mobile Payments, Which is Better for Teens?
- Are Prepaid Cards an Effective Method for Teaching Kids About Money Management?
- What Are Parents Looking When in a Prepaid Card for Their Children?
- Is the Money Protected if My Child Loses Their Prepaid Card?
- Best Prepaid Cards For Teens 2020
These days, more and more parents are considering getting their teenage kids a prepaid debit card. Before we dive into which is the best prepaid cards for teens there are a range of questions that should be asked and answered.
Parents consider getting their teenage kids a prepaid card as a way to teach and help their kids to understand and manage money. Parents could teach their kids how to manage money just as good with cash but eventually, as kids grow, they will be using either a prepaid, debit or credit card.
Yes, for the same reason mentioned above. It teaches teens how to manage money a skill that will help them financially in the long run. Recent data shows that 20% of US teens are not financially literate. What better time to start than now, while they are young and capable of picking up great habits.
This is really up to the parents to decide. Some parents pay children an allowance or stipend for doing work around the house and other chores and errands. Instead of giving their kids cash they transfer money from their account into their children's prepaid card.
Other teenagers are old enough to work part-time or summer jobs and can have their paycheck direct deposited onto their prepaid cards. There are also prepaid cards that allows the entire family to share the same balance and that money usually comes from the parents.
Yes, parents will be parents and that includes deciding how their teenage kids spend their money without being told to. However, several prepaid cards have the functionality built into the user account to helps assist parents control certain aspects of their children's money.
Teens are usually thrilled to have their own prepaid card because it always them, for the first time, to purchase items online. This new way of buying things is exciting to them.
Prepaid cards are better for teenagers and parents because these reloadable cards are slightly more secured and are FDIC insured, where not all mobile wallets like PayPal or Cash App are. Certain prepaid cards also give parents more control on how much money is being spent from their kids prepaid card.
It's harder to do that with mobile wallets because a single account is controlled by that one person and kids can change the password or setup other preventative measures to keep the parents out.
Last, for most parents the whole point is to get kids used to how prepaid cards work so when they upgrade to debit cards or credit cards they will understand how to manage their money. It's a slightly different learning process with mobile payments.
Absolutely, prepaid cards allow teens & younger kids to get in the habit of making great financial decisions. Teens will get in the habit of reviewing their past purchases, checking their balance and placing money into their savings account for whatever reason they're saving money. It's an introductory step but a vital one.
Parents often look for prepaid cards that offer low-to-no fees. Parents are also looking for straightforward simple-to-use cards without the "mumbo jumbo". Some parents also want to be able to see how much and what their kids are spending money on and be able to limit it to some degree.
If it's a prepaid card with a shared balance parents can likely deactivate the card that is lost or stolen and disconnect that card from the available balance. Nothing more is usually required to protect the money. If the prepaid card doesn't offer a shared balance, then as long as the parent calls customer support and alert them that their son/daughter has lost/or had their card stolen, they have nothing to worry about.
The prepaid card provider will closed the account to that card, and issue a new card with a different account number and transfer the funds to the new account. There will likely be a replacement fee of $5-$10 that will be charged to the new account however.
There are only 3 prepaid cards that we really recommend for parents looking for the best prepaid cards for teens. We took into consideration features parents are concerned with such as low fees, easy usability, and some level of control. These prepaid cards are not in any particular order, but they are the best prepaid cards for teens.
1. Famzoo - We think Famzoo is one of the best prepaid cards for teens as of 2020. Famzoo has a very user-friendly dashboard that is easy for teens to navigate, review past purchases and check their balance.
Famzoo is is relatively low on fees, especially when more than one family members are connected to the same balance. When 4 family members share a single balance the monthly fee drops significantly.
Oh, did we mention that this is a shared balance prepaid card? Famzoo allow up to 4 family members to share a single balance. This is definitely a great idea when parents are thinking of getting a prepaid card for more than one kid.
2. Serve - Serve is a very efficient prepaid card for teens and here's why: if you already have an Amex Serve reloadable card you can create what's called "sub-accounts". American Express will issue a separate account and card for the sub-account you created.
Parents can then transfer funds from their main Serve account into the sub-account. This pretty much creates a very similar experience to the Famzoo card, but also a very different one because the two balances are independent from each other. The sub-account can only be funded by the main Serve account giving parents a considerable amount of control if needed, while letting their teenage kids spend and manage their money as they wish.
You can create up to 3 sub-accounts. Serve prepaid card charges very little fees as well. A monthly fee of $6.99 is applied only to the main Serve account and if you live in New York or Vermont the monthly fee is only $1. We encourage you to learn more about the Serve card.
3. Greenlight is a great choice of prepaid cards for teens. Green Light has a pretty low monthly fee compared to other prepaid cards out there. Green Light only charges $4.99 per month. Parents can setup spending limits and be notified about their child has spent money. Green Light has built in features in its mobile application that allow parents to setup reoccurring payments for chores and allowances which is a pretty neat feature.