Oct. 31, 2018
Your kid is at college and needs some money. How to you get it to them?
If your son or daughter has a bank account, you can transfer money between your account and theirs. Or use a mobile peer-to-peer app, such as Venmo, Zelle or Apple Pay.
Consumer Reports suggests another option: A reloadable prepaid card. It can be used to buy things (online or in person) or to get cash at an ATM.
You can buy prepaid cards online or at the store. Be sure to compare fees. What’s the charge to buy and reload that card? And check to see if there's a monthly fee.
Consumer Reports says prepaid cards “can be a great way to teach students budgeting” because they need to stay within the specified amount you’ve loaded in their account that week or month.
“If I wanted to teach someone how to manage money, I’d give them something with which they can’t get in a hole. That product is the prepaid card,” said Christina Tetreault, senior staff attorney with Consumers Union, the advocacy division of Consumer Reports.
Note: Prepaid cards don’t provide the same fraud protection as credit cards. Starting in April 2019, they will, when the Consumer Financial Protection Bureau’s new Prepaid Card Rule goes into effect.
The experts at Creditcards.com say the Bluebird card, issued by American Express in partnership with Walmart, is the cheapest way to go. There’s no purchase fee, no fee for online activation and no monthly fee. There are also ways to load money onto the card for free.
More Info: How to Fund Your College Student