Tag: debit card

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Eliminating Fees, Reviews

FamZoo Review: a Virtual Family Bank to Teach Kids About Money

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

FamZoo Review

When it comes to banking, most kids learn the hard way just how expensive their mistakes can be — with every sting of an overdraft fee or bounced check. Parents who would rather teach their kids how to manage their money without the risk of fees might consider FamZoo, a virtual family banking program. For a modest subscription fee, FamZoo provides the tools parents need to teach their kids about money management and banking.

Is FamZoo worth the cost?

In this review we cover:

  • What is FamZoo?
  • FamZoo Fees
  • FamZoo Benefits
  • Who Should Consider FamZoo?
  • FamZoo Drawbacks

What is FamZoo?

FamZoo is a “Virtual Family Bank” that allows parents to teach their kids about banking


without requiring kids to pay fees (as a parent, you will pay a monthly subscription fee).

FamZoo has two versions. The first version is a virtual IOU account that formalizes and tracks money flowing between parents and kids, but is not a bank at all. The second version gives prepaid debit cards to parents and kids that can be used anywhere that debit cards are accepted (including ATMs). Both versions cost the same amount for parents.

In addition to basic banking, FamZoo offers family oriented features. For example, family member can request reimbursements from other family members, and parents can offer loans to their kids and teach them to pay back loans in installments. With parent approval, money moves between family accounts instantaneously. FamZoo allows parents to fund allowances, and it helps kids divide their money between saving, spending, loan repayment and giving. As a parent, you can set a parent paid interest rate to encourage savings.

If you opt for prepaid debit cards, the cards will not allow your kids to overdraft, and parents and kids have access to a website to check balances, to review transaction history and more. Kids can also withdraw money fee free from in network ATMs.

FamZoo Fees

Subscription fee: Parents pay $5.99 per month (or $60 for 2 years with pre-payment) for up to four prepaid debit cards including a parent loading card. If you want more than four cards (for example to separate giving, saving and spending accounts, or if you have more kids), you pay a one-time $2 fee per card. If you lose a card, you can receive a replacement card for free.

Aside from the monthly subscription fee and the one-time extra card fee, FamZoo does not assess any fees, even if you manage to overdraft (which is possible if your transaction “settles” for an amount greater than was initially assessed).

Load fees: Depending on which financial products you use, as a parent, you may pay a fee to load your card. If you have access to Wells Fargo Sure Pay, Dwolla or PayPal, you can transfer money to your FamZoo account for free, or you can fund the account for free via direct deposit from your paycheck. Other loading options cost between $.95 and $7.00 per transaction. The institution where you initiate the transaction charges these fees, but FamZoo doesn’t add any extra fees.

ATM fees: FamZoo is part of the MoneyPass ATM network and withdraw cash at no fee. However, FamZoo warns that the other institutions usually charge a fee for out-of-network ATM use, and these fees aren’t reimbursed.

FamZoo Benefits

Parents have control: FamZoo is a stripped down bank that gives parents banking control, but it also has a few mainstream financial benefits. For example, MasterCard Zero Liability Protection backs FamZoo cards which means that they have fraud protection. Like other debit cards, they offer transparency, the ability to freeze an account if the card is lost or stolen, and the ability to track spending. And, each account has its own routing and account number so kids can get their paychecks deposited like it’s a regular bank account.

Helps teach saving and budgeting: The primary benefit of FamZoo is the way helps parents raise financially savvy kids. The software allows you to teach your kids to track expenses, set budgets, and split money into various accounts (a modern version of the envelope system). As a parent, you can add complexity (adding interest, loans, etc.) as your kids mature.

FamZoo Drawbacks

False sense of real-world banking fees: FamZoo puts guardrails in place, so kids don’t get hurt when they fail to manage their money well (they can empty out their bank account, but they won’t pay overdraft charges and they cannot go into debt except to their parents), but parents who use the software also need to teach their kids about banking fees outside of FamZoo. This will be especially important as teens set up their first checking accounts.

Who should use FamZoo?

FamZoo suits parents with kids who don’t yet have jobs or their own bank accounts who want to teach their kids financial principles. FamZoo makes teaching basic finances easy, and if your kids make mistakes, they don’t have to pay outsized fees.

Parents of early elementary through early high school will appreciate the valuable teaching opportunities that FamZoo provides, and parents with older teens and college students can advantage of transferring money with ease.

Hannah Rounds
Hannah Rounds |

Hannah Rounds is a writer at MagnifyMoney. You can email Hannah at hannah@magnifymoney.com

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Credit Cards, Identity Theft Protection

When Banks Can Refuse to Refund Fraudulent Debit Card Charges

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.


Typically, debit cards that are used as “credit” are offered the same protections as credit cards. This means that if you use your debit card in a store and choose “credit” instead of entering your PIN number, you should receive the same protections as if you used an actual credit card. However, we do encourage you to double check the fine print your bank provides on this matter before assuming your debit card will receive those protections.

But here’s a scenario where your debit card is riskier than your credit card. If you withdrawal money at an ATM (or any store doing cash back) using your PIN number, you have additional risk. If someone steals your pin number with a skimming device at an ATM, then he has direct access to your money. This isn’t like credit card fraud with obnoxious charges you need to dispute. This is your hard-earned cash being taken directly out of your checking account. And if you aren’t careful, you might not be able to recoup your losses.

So, what can you expect if you are a victim of debit card fraud?

Timeline for Being Able to Get Your Money Back

If you are a victim of debit card fraud, you are responsible for the following:

  • $0 if you report the loss or fraud immediately and the card has not been used,
  • Up to $50 if you notify your bank within 48 hours of your lost or stolen card,
  • Up to $500 if you notify the bank with 48 hours and 60 days of your lost or stolen card, and
  • All of the fraudulent charges if you don’t notify the bank until after 60 days.

It’s important you don’t delay in reporting the fraud to your bank if you want to be able to get all of your money back. If you were the victim of theft because the crook skimmed your info and used your PIN, then you may be on the hook for the $50 because you couldn’t report to the bank before the card was used. You didn’t know it had happened until the strange transaction showed up!

It may seem unfair to be responsible for charges that you did not actually charge yourself, but to avoid that scenario and protect yourself, consider taking the following precautionary actions.

What You Can Do To Protect Yourself

To protect yourself against debit card fraud, you should do the following:

  • Only use an ATM inside a bank (this will lesson the likelihood that a scanner is on an ATM)
  • Cover your hand when you type your pin into an ATM (to protect yourself against any devices attached to the ATM from getting your PIN)
  • Set up text alerts for each transaction over $0.01 on your card. This way you’ll be immediately alerted if a bogus charge is made
  • Monitor your bank on a regular basis (so you can give notice of fraud immediately)
  • Report stolen funds immediately (so you’re not responsible for the charges)
  • Check-in annually with your bank as to the policies regarding debit card theft (know whether your debit card is specifically protected and to what extent)

While you can notify the bank by phone, it is best to get everything in writing. For purposes of the time requirement, notice is considered given when you put the letter in the mail. It’s even better if you send the mail certified. You can, of course, send notice by mail and call. Whatever you do, keep a record of your communications you have with the bank. This will put you in the best position if you have to escalate your problem.

Remember that if you take the actions listed above, you will be more protected than you otherwise would. Even if you didn’t do anything wrong, like in the example above, you can still find yourself stuck with fraud charges that your bank won’t reverse. These specific steps will help you protect yourself, even when you’re not at fault. This is particularly important if you use your debit card frequently.

Don’t want to use a credit card? Learn how to survive with just debit cards here. 

Debit vs. Credit: How to Decide

Using a debit card forces you to keep your spending in check because you cannot spend more than you have in the bank. However, it may be riskier than using a credit card for the reasons described above. If you’re not sure which is best for you, ask yourself what do you value more – your spending being limited or the additional protections from fraud. If you can control your spending, then you may be better off with a credit card. If you are a spender, however, then take the additional steps listed above to make sure you fully understand your specific liability in the event of debit card fraud. If you feel your bank is behaving unethically and should be refunding you, then reach out to the Consumer Financial Protection Bureau to file a complaint.

Natalie Bacon
Natalie Bacon |

Natalie Bacon is a writer at MagnifyMoney. You can email Natalie at natalie@magnifymoney.com


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Life Events

How I Live Without a Credit Card

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.

Black woman using credit card and laptop

I am 29 years old, and I’ve never had a credit card – ever. I didn’t know this was unusual until other people were shocked and surprised that I have never had one.

Here are the main points that people like to know about my life without a credit card.

Why? Because I’m a Spender

The main reason I do not have a credit card is because I am a spender by nature. I just like to spend money. Having a credit card would be tempting for me. Some say that I don’t give myself enough credit and that the temptation wouldn’t be as bad as I think. However, these people are wrong. I know they’re wrong because I know myself better than they know me. I’ve actually dipped into my savings before for non-emergencies – just because I wanted something so badly. This is how I know that I cannot have a credit card. If my savings is at risk, I know that a card would be even more tempting for me.

Initially, I didn’t get a credit card because my grandpa told me that “using a credit card was like taking a mortgage out on your clothes”. This sunk in morally for me, and I decided I didn’t need a credit card. His point was more directed at carrying a balance on a credit card, which we can all agree is not a good idea, but I still decided I didn’t want anything to do with it.

Over time, I’ve deciding my personal temptation to spend money is high enough to warrant continuing to not have a credit card. This is why I use my debit card for almost everything.

I Use My Debit Card Like a Credit Card

I use my debit card for almost all of my purchases (the alternative being cash). I always choose “credit” when I’m paying with my debit card, because it’s best to minimize the use of your pincode as much as possible. In addition, Visa and MasterCard both have a business promise to provide zero liability protection on a debit card if you first, take reasonable care to protect your card and second, report the fraud in a timely manner. However, because any fraud on my debit card means direct access to my funds instead of fraudulent charges on a credit card – I take other measures to be proactive about protecting my information. I make sure that my card is up to date, and I’m usually issued a new card every one-to-two years.

I can stay at a hotel, rent a car, book a flight, and do anything else I’ve ever wanted to do by using my debit card. I always make sure I have a small cushion in my checking account, because in some instances, there will be a higher hold charge when using a debit card (e.g.: staying at a hotel).

Personally, I have never had a problem using a debit card as credit. That’s not to say it can’t happen – it just hasn’t happened to me. I know plenty of people who have had problems with credit cards and / or with debit cards. I make sure to monitor my accounts, and pay close attention to my credit so if there is any problem, I know about it immediately.

I Pay Close Attention to My Credit Reports

Because I only use a debit card, I am on heightened alert to pay close attention to my credit. I order my credit reports from the three main credit-reporting agencies (Experian, Equifax, and Trans Union) every year. I look for errors or fraud, and I report any incorrect information immediately.

My Credit Score

The biggest question people have for me is how I keep a high credit score. I have two responses. First, I actually do have a high credit score because of my student loan debt. I monitor it annually, and I know that it’s in good shape. I am aware that this won’t last forever, but it does work for now.

Second, I am not as concerned about my credit score. For me, credit is a “debt score”. Unfortunately, our system measures your creditworthiness based on how much debt you have and have paid off, not on how much you have in assets. For example, you could have $2 million in the bank, but if you never took out a line of credit (debt), you wouldn’t have a credit score and wouldn’t be able to get financing. I wish that the underwriting was different and that assets were measured and included, but since they’re not, I understand the need to have a high credit score if you want to buy expensive things, like a car or house.

My personal financial goal is to be financially free, without debt. I don’t want to take out more debt, so I am not as fixated on having a high credit score.

I am not so naïve to think that I may never need my credit score (particularly if I want to buy a house), but my goal is to live according to my personal values, and not have my credit score be a determining factor in my financial decision-making. I will likely revisit this when my student loans are repaid, but it will probably be in the form of financing something when I have cash in the bank to pay for it solely for the purpose increasing my score, as opposed to using a credit card. I do not foresee me ever using a credit card.

I understand that people without student loan debt may need to use a credit card to get a high credit score, but this just hasn’t been my experience. Personally, I have student loan debt and I am a spender, so it doesn’t make sense for me to have a credit card.

Points I Give Up

People also swear by their credit cards for the points that they get for spending. They go on trips and get material things that I cannot get for free by using a debit card. This is one area where I am aware of the perks I’m missing out on.

For me, I compare the perks I’m giving up on the one hand to the certainty for being consumer debt free on the other hand. I am a spender and I like to buy things. I would much rather not having the temptation and remain consumer debt free than benefit from credit card perks.

I think I could get a few free flights out of having a credit card, which would be amazing on the budget I’m on; however, I am certain it would not be worth it if I got into debt and couldn’t repay my card every month.

This is a personal choice that works for me.

I Don’t Like Debt

I don’t like debt, and I don’t like being tempted to spend more money than I otherwise would. I am committed to repaying my student loans and building wealth. Personally, I am not focused on credit card rewards or building my credit.

I like my life without a credit card, and I plan to keep it that way. It works for me.

Natalie Bacon
Natalie Bacon |

Natalie Bacon is a writer at MagnifyMoney. You can email Natalie at natalie@magnifymoney.com


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Consumer Watchdog

Consumer Watchdog: Debit Card vs Credit Card – Which Should You Use

The editorial content on this page is not provided by any financial institution and has not been reviewed, approved or otherwise endorsed by any of these entities.


There is a lot of noise in the personal finance world about the dangers of using a credit card. Personal finance gurus condemn them because it’s easy to go into debt. They say people mindlessly swipe when they use credit cards. Or that chasing after credit card rewards leads you down a rabbit hole to debt. The intentions behind these warnings may be spot on, but the bigger danger is your other plastic: a debit card.

Basics of a Debit Card

Your debit card (or ATM card) links directly to your checking account. The card is protected with a pin number of your choosing and provides you with physical access to your money by making ATM withdrawals or cash back at a store. The money you spend or withdrawal is immediately reflected in your checking account. It makes sense why budgeters and personal finance gurus would encourage the use of this product. Whatever you spend is reflected in your bank account. It’s the next best thing to spending cash.

Basics of a Credit Card

A credit card is not linked to a specific bank account. Your lender provides you with a credit limit and that’s the maximum you can spend in a month (which we don’t recommended ever maxing out). After your bill comes, you pay it off and start the process over again. You can link your checking account to your credit card to pay your bill, but this is not the same as a debit card. Linking a checking account to a credit card portal only allows you to transfer the money owed to the lender. It in no way is giving your credit card (or lender) easy access to the funds in your account.

Debit Card vs Credit Card

So a debit card allows you to spend the money you already have and a credit card is a loan you need to pay off each month. You may be wondering when it comes to a debit card vs credit card the answer seems obvious: debit.

But here’s the catch.

Credit cards offer significantly better protection against fraud.

Difference in Fraud Protection


A debit card being linked to your checking account seems like a positive until you come in contact with a skimmer or hackers steal information from a company’s database. Skimmers are tools used by crooks to get your information and start using your debit card. They don’t even need to physically have your debit card. You use a compromised ATM (you can’t tell it’s compromised until after) and the crook has your debit card number, name and even pin number.

The crook has direct access to your money. He’s not making charges on a credit card, but actually pulling funds out of your checking account.

You might even be liable for some of these charges!

Federal law protection varies based on when you report the loss.

Screen Shot 2015-02-27 at 9.21.21 AM

*image from FTC.gov

Once you report the crime, bank will likely give you a credit to cover your losses while it opens an investigation into your fraud claim. You’ll owe the money back if the bank finds you liable.


Credit card fraud is significantly different than debit card fraud. Crooks don’t have access to your bank account. Instead, they’re racking up charges that are often detected quickly by your credit card lender. Your lender may proactively freeze your card and then call you to inquire about recent charges before closing it down and issuing you a new one.

A majority of credit card issuers provide users with a zero liability policy, so you aren’t responsible for any fraudulent charges made on your card.

Debit Card vs Credit Card: Credit Card Wins

At some point you will deal with fraud either due to hackers, skimmers, a stolen wallet or a dishonest store clerk. When this day comes, it’s best the information stolen doesn’t link directly to your bank account.


Erin Lowry
Erin Lowry |

Erin Lowry is a writer at MagnifyMoney. You can email Erin at erin@magnifymoney.com

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