Jeremey over at GenXFinance reviewed the new Discover Prepaid Debit Card. The card is focused on teaching teenagers about controlled spending and maintaining balance limits, which is great. But what about those Gen X and Gen Y’ers who don’t trust themselves with their plastic? A good way to impose restraints on unruly spending? We think so.
After interviewing the founders of Thrive (interview tk), the free online PF management site, Avi Karnani (CEO) mentioned that at a recent speaking engagement at a university, three girls in the front row went as far as to say that they distrusted themselves with money so much so, that they would welcome a card that somehow shocked them whenever they were about to make a purchase.
We’ve discussed bad spending habits that spiral into disorders, and this seems to fit the bill pretty well. But if there are people suffering from a shopping addiction, imposing stringent spending limits could very well be a workable solution. I doubt anyone is going to come up with a credit card that shocks you into financial submission, but having a card that automatically cuts you off at a certain limit could at least pose such an embarrassing situation that one would be unlikely to repeat it.
The Discover Prepaid Debit Card does something like that by allowing cardholders to:
- have the ability to set daily, weekly and monthly limits
- set restrictions for certain stores or types of stores (ie – clothing stores, bars)
- email and text activity alerts (which could work really well if you’ve enlisted a friend or relative to hold you accountable for your spending)
And since there are downfalls to all that is good, the cons for the card are pretty much what you’d imagine: Fees.
- monthly fee of $5 (or $50 annually)
- .50 ATM transaction (with 4 free transactions per month)
- statements by mail cost $5
It seems like it might be a bit of a hassle to set up; however, if you’re serious about putting some intense restrictions on your spending, this card offers some pretty cool features. Being able to block yourself from making purchases from a store that you have a habit of letting loose in is a pretty smooth option, and one that I haven’t seen from any other credit companies. But what would really be great is if this started a trend with other banks and credit lenders — allowing you to block certain stores and impose daily spending limits on cards that you already have.
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Thanks for sharing. It is useful for everybody.
It practically gives “carte blanche” to those institutions, and perhaps even creditors to invade one’s checking account in mere nanoseconds, or the speed of light, whichever is faster, and drain your funds at will.