ANDY'S CONSUMER TIP OF THE DAY: joint account vs. prepaid cards - WMC Action News 5 - Memphis, Tennessee

ANDY'S CONSUMER TIP OF THE DAY: joint account vs. prepaid cards for college students

ANDY'S CONSUMER TIP OF THE DAY: joint account vs. prepaid cards for college students

MEMPHIS, TN (WMC) -

"Junior" or "Juniorette" is hitting the road for the summer or heading to college. You're already sweating how you're going to supply them with cash, short of them working a part-time job.

A couple years ago, a viewer from Olive Branch, Mississippi, emailed me. He said his son was leaving home to spend three months on a 28-city band tour. He thought about loading a prepaid debit card to serve as his son's cash flow. While researching his prepaid options, he quickly discovered some of their pitfalls.

"Some cards have fees, others don't," he wrote. "Some cards can be used at ATM's, others can't. Can you give me any insight as to what is the best card to use?"

My answer: there isn't one.

Bill Hardekopf, CEO of LowCards.com, has said most prepaid debit cards carry fees or spending restrictions. He suggested parents should opt instead for a joint checking or credit card account.

Hardekopf said the advantages of a joint student debit/credit card account are:

* FREE CHECKING/NO FEES. You can still find a free joint checking account out there with no fees.

* PARENTAL OVERSIGHT. Mom and Dad get the statements and access, too.

* BUILD STUDENT'S CREDIT HISTORY. You can't do that with a prepaid debit card.

Talk to someone where you bank now first about a joint account option for your traveling child. If the bank can't offer one without fees or strings attached, shop another bank or shop online for one that is free and set the ground rules with your kid on spending and budgeting.

Copyright 2017 WMC Action News 5. All rights reserved.

Powered by Frankly