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Best Savings Account Bonus Offers

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

There’s no shortage of checking account bonus offers, with everyone from small local banks to the big household names offering hundreds of dollars to new customers. Banks know it’s hard to get you to leave your old bank, especially when you’re comfortable with the accounts you have. But what better way to entice you than with a big cash bonus?

You’ll find these bonus offers attached to more checking accounts than savings accounts. After all, checking accounts are a crucial part to banking, as they allow you to easily access your money for purchases and transfers.

That’s not to say there aren’t any opportunities to earn money with a new savings account. We’ve found five of the best savings account bonus offers as of the date of publishing. It’s easy to go straight for the highest amount, but pay attention to the bank and the account you’re getting ready to open. Make sure it’s a bank you actually want to do business with.

Further, double check that you’ll be happy with the new account for months to come. It can take months to meet the offer requirements and even longer to actually receive the bonus. If there’s a monthly fee on the account, you could be stuck paying that unnecessary fee, especially if you can’t meet the balance requirements to waive it. You may not even be happy with the interest rate on the account, which might make the savings account bonus offer not entirely worth it.

The 5 best savings account bonus offers in 2019

Methodology

To find the best savings account bonus offers, we looked for the highest bonus amounts offered. Below, you’ll find the five biggest bonus offers on savings accounts being offered. Offers are current as of this publication date and we will update the article periodically to show the freshest ranking.

Citi — $500 bonus with $15,000 minimum deposit

Offer ends 6/30/2019

Offer rules: You must be a new Citibank customer and open a Citibank Account Package, which includes a checking and savings account. Within 30 days of opening these accounts, you must deposit at least $15,000 in either of these two accounts with money new to Citibank, and maintain a minimum balance across both accounts of $15,000 for 60 days.

After meeting the above requirements, you’ll get $400 in bonus money deposited into your checking account (or savings account if you’ve closed the checking account). If you make at least two ACH deposits into the checking account portion of the Account Package within 60 days of opening the account, you’ll receive an additional $100.

Who’s eligible: You must be a new customer to Citibank and enroll in the bank’s “$400/$500 Checking and Savings Offer” either in person, over the phone, or online.

Account details: There’s a $25 monthly maintenance fee, which you can avoid be keeping a minimum of $10,00 deposited across both accounts (which you’ll want to do anyone in order to qualify for the bonus, which requires a minimum of $15,000). You may not want a checking account and are free to close it, but keep in mind in order to get the $100 bonus (to bring the total amount to $500) you need to make the ACH deposits into a checking account, not a savings account.

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on Citi’s secure website

Discover — $200 bonus with $25,000 minimum deposit

Offer ends 6/3/2019

Offer rules: Discover customers can benefit from a $200 bonus by opening a Discover Online Savings account for the first time by June 3, 2019, which is the same date this offer ends. You’ll then need to deposit at least $25,000 into the account by June 17, 2019.

If you can’t meet that minimum amount, you can earn a $150 bonus instead by depositing at least $15,000 into the new account by June 17, 2019.

The bonus will be credited to your account by July 1, 2019.

Who’s eligible: You must be a new Discover savings customer to qualify for this savings account bonus offer. You must not have had a savings account that was co-branded or an affinity account provided by Discover either.

You can apply for the offer with the code “MM519” either online or by phone.

Account details: Discover’s Online Savings Account earns at a competitive interest rate of 2.10% on all balances. There’s no monthly service fee and Discover promises no hidden fees. You’ll only face a charge for excessive withdrawals, stop payments, insufficient funds and outgoing wire transfers. Discover will waive the first excessive withdrawal, insufficient funds or stop payment fee you encounter each calendar year. Keep in mind that the bonus is considered interest and will be reported on a 1099-INT form.

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Chase — $150/$350 bonus with $10,000 minimum deposit

Offer ends 7/15/2019

Offer rules: In another bonus offer from Chase, you can get $150 when you open a new Chase Savings account. You’ll need to deposit at least $10,000 in new money (not previously held with Chase or its affiliates) within 20 business days and maintain at least that minimum balance for 90 days.

Want to do more banking with Chase and open a Chase Total Checking account, too? Opening both a new checking and savings account can get you a $350 bonus, as long as you follow the above savings account rules and set up direct deposit on your new checking account.

Who’s eligible: You’re eligible for the Chase Savings account bonus offer if you are not already a Chase savings customer. You also cannot have had an account that was closed within 90 days or with a negative balance.

If you close this new savings account within six months after opening, Chase will deduct the bonus amount from the account at closing.

Account details: The Chase Savings account earns interest at a nominal rate of 0.01% APY, which isn’t ideal for savings growth. There is a $5 monthly fee on the account. You can waive the fee with one of the following, each statement period:

  • A daily balance of at least $300
  • At least one repeating automatic transfer of $25 or more from your personal Chase checking account or Chase Liquid® Card
  • An account owner who is younger than 18
  • Linking this account to a Chase Premier Plus Checking, Chase Sapphire Checking or Chase Private Client Checking account

You could also face a $5 fee for each excessive transaction you make over the six-transfer limit per statement cycle.

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on Chase Bank’s secure website

Associated Bank — $100 bonus with $10,000 minimum deposit

Offer ends 12/31/2019

Offer rules: Opening a new Associated Bank Money Market account can get you a $100 bonus. You’ll need to deposit at least $10,000 in new money (held outside Associated Bank) at opening and maintain at least that much in the account for 90 days to receive the bonus.

The bonus will be paid within 120 days of account opening if you meet the requirements. The account must be open at that time. You must also keep the account open for at least 12 months.

Who’s eligible: You can redeem this offer online or by taking a coupon sent via email to an Associated Bank branch. This offer is limited to one per household. Households who have or have had an Associated Bank Money Market account within the last six months do not qualify. You must be 18 years or older to apply for the bonus. If you close the new account within 12 months of opening, Associated Bank can deduct the bonus amount from your funds at closing.

Account details: The Associated Bank Money Market account is a true money market account, with the ability to write convenience checks and access Associated Bank and MoneyPass ATMs. It earns interest, too, between 0.05% and 1.00% APY. You can earn at higher rates by having a higher balance and a qualifying Associated checking account.

The money market account does charge a $16 fee, which you can waive by maintaining a $1,000 minimum balance.

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on Associated Bank, NA’s secure website

Member FDIC

First Tennessee — $50 bonus with $5,000 minimum deposit

Offer ends 6/30/2019

Offer rules: When you open a new First Tennessee Money Market Savings account with at least $2,000 you have a chance at earning a $50 bonus. To snag the offer, you must also deposit a total of at least $5,000 in the first 30 days of account opening. Your deposits must be made from accounts outside of First Tennessee Bank.

Who’s eligible: To redeem the offer, you can open the account online with the Promo code “SVSC50.” You can also visit a First Tennessee branch and present a copy of the offer. You must be a resident of Alabama, Arkansas, Georgia, Kentucky, Mississippi, Tennessee or certain parts of Virginia (Bristol, Weber City, Gate City) to qualify. You must also be a new customer to the bank, meaning households with current consumer savings accounts or accounts closed within the past 12 months at First Tennessee Bank or Capital Bank cannot redeem the offer.

Account details: The bank’s Money Market Savings account earns interest according to balance tiers, so the higher your balance, the higher the rate. Overall, however, the rates are relatively low, ranging between 0.01% and 1.00% APY. You’ll need $250,000 or more to earn at the highest level.

You can access your Money Market Savings funds through ATM or check. There is a $9 monthly fee on the account. You can waive the fee with either a qualifying checking account or if your total combined balance in First Tennessee accounts is at least $5,000.

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on First Tennessee’s secure website

How do these accounts compare to the best online savings accounts?

When looking for the best online savings accounts, you won’t find much overlap here. Bonus offers tend to come from brick-and-mortar banks, as incentives for you to place your deposits with them.

Online banks still win by and large. But don’t let these financial carrots mislead you into thinking they are the best on the market — many of the best accounts are being offered by online banks these days. Online accounts tend to have the highest interest rates and the lowest fees — what more could you want? That’s why you’ll find most sign-up bonuses being offered by brick-and-mortar banks.

Know the pros and cons. You should figure out whether it’s worth it for you to open a new account with a traditional bank just for a bonus offer. Don’t forget, you can’t open a new account for a bonus offer and close it immediately. Qualifying for and receiving the bonus takes months. You could even lose your bonus offer if you close the account too soon. Plus, a savings account bonus offer is a short-term boost in savings, rather than the ongoing growth of a high-yield account. It won’t help your savings situation if your new account charges a monthly fee that you can’t waive, either.

Factor in fees. If you do desperately want to snag a couple hundred dollars by opening a new account, make sure you won’t be paying a monthly fee for the months you have the account. That way, you won’t lose any of that bonus right off the bat. Again, double check the account’s closing terms to ensure you won’t lose the bonus at closing, either. It’s also important to be able to meet the account’s minimum balance requirements. It may not make sense for you to keep $10,000 in a low-earning account just to earn a $200 bonus, for example.

Do the math. Let’s say you do deposit and maintain $10,000 in a new savings account that has an interest rate of 0.01%, which is typical of brick-and-mortar savings accounts. After a year, you’ll have earned $1 in interest. Add that to your $200 bonus and you can add a whopping $201 to your savings. Now, if you were to forgo the bonus offer and deposit your $10,000 into a high-yield savings account with a 2.25% APY, you’ll earn just over $227 after a year (with monthly compounding) — a better savings boost than the savings account bonus offer.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

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Banking

The Best Prepaid Debit Cards

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

Prepaid debit cards are flexible tools that can help you manage your financial life. If you don’t have a bank account but need to pay with a card, a prepaid debit card does the trick. Tend to overdraft your checking accounts? A prepaid debit card can help you avoid nasty overdraft fees.

The best part of prepaid debit cards is that you can use them anywhere the card issuer is accepted, whether that’s Visa, Discover, Mastercard or American Express. But which to choose? There are hundreds of options, many of which charge fees — there can be several — and have balance limits.

To help you avoid fees and select the best prepaid debit card for your needs, we weighed a range of key factors and found the top options for a range of different users. We identified the best prepaid cards for low fees, which can be especially helpful if you’re already tight on money. We also found prepaid debit cards with the lowest ATM withdrawal fees to ensure you can access your cash. It’s also important to be able to fund your prepaid card without it costing an arm and a leg, so we list the best prepaid cards for cash reloads and direct deposits. Finally, we looked at the best rewards prepaid debit cards.

The best low-fee prepaid debit cards

Prepaid debit cards are great options if you don’t qualify for traditional banking products, whether because of traditional banking fees or bad credit. Either way, we’ve found the best prepaid cards without monthly fees so that you can take advantage of their benefits. We ranked the following cards by looking for the lowest monthly and activation fees.

Bluebird by American Express — $0 monthly fee, $0 activation fee

Bluebird by American Express Bluebird by American Express is our top low-fee pick thanks to its lack of monthly, annual and activation fees. The card is free to purchase online, but it costs $5 if you buy a Bluebird Account Set Up Kit at a Walmart store.

The Bluebird card is also a low-fee favorite for its free reloading options through direct deposit, debit cards and cash deposits at Walmart. If you want to deposit cash at another participating retail location, it can cost up to $3.95 per deposit. You can withdraw money for free from any MoneyPass ATM. All out-of-network ATM withdrawals will incur an American Express fee of $2.50, in addition to a possible surcharge from the ATM owner. It doesn’t charge fees for replacement cards, foreign exchange withdrawals or account inactivity.

You can use the Bluebird by American Express card anywhere American Express is accepted. Just keep in mind that American Express isn’t accepted by merchants everywhere. Bluebird Checks are also available ($19.95 per checkbook, plus taxes and shipping) to make purchases. You must have each check pre-authorized to prevent you from writing a check for more than you have in your Bluebird account.

Your Bluebird funds are Federal Deposit Insurance Corp.-insured through American Express National Bank.

Navy Federal Credit Union GO Prepaid Card — $0 monthly fee, $0 activation fee

Navy Federal Credit Union GO Prepaid Card With a promise of no hidden fees, the Navy Federal Credit Union GO Prepaid Card doesn’t charge you for opening and activating the card, or for making purchases. When you open a card, you must fund it with at least $20 initially with a Navy Federal debit card or credit card. Other payment forms are not accepted when first funding the account. You can use Navy Federal ATMs without facing a fee, but using out-of-network ATMs both domestically and internationally will incur a $1 charge from Navy Federal. Transactions made in foreign countries in U.S. dollars or foreign currency, both for purchases and at ATMs, will trigger a Visa International Service Assessment Fee of 1.0% of the transaction amount.

Navy Federal membership includes active-duty military members, veterans, retirees, select Department of Defense employees and immediate family members of eligible service members. You must be a member of the credit union who is 18 or older and listed as primary owner on a Navy Federal savings account to open a GO Prepaid Card.

MyVanilla Prepaid Card — $0 monthly fee, up to $3.95 activation fee

MyVanilla Prepaid Card You don’t have to worry about a monthly fee with a MyVanilla Prepaid Card. The card allows free direct deposit, bank transfers and MyVanilla card-to-card online transfers to fund your account. Adding funds through a Vanilla Reload network retailer can cost up to $3.95, depending on the merchant.

Using a MyVanilla Prepaid Card to withdraw cash isn’t always fee-free. Although the card’s website indicates surcharge-free MoneyPass ATM access, using any domestic ATM, including MoneyPass machines, will cost $1.95, according to customer service. International ATM withdrawals cost $4.95. To avoid setting your savings back, you’ll want to stick to using a MyVanilla card simply to make purchases.

MyVanilla Prepaid reloadable cards can be opened either as a Visa or Mastercard. There are only slight differences in retailers that accept one versus the other, so you can choose based on preference. You can open a MyVanilla Card online or at participating retailers, such as Family Dollar, Walmart and Walgreens. After purchasing the card at a store, you need to register it online to start using it.

Whether Visa or Mastercard, all MyVanilla Prepaid Cards are FDIC-insured through The Bancorp Bank.

The best prepaid debit cards for ATM withdrawals

While prepaid debit cards come with the convenience of debit and credit cards, it can still help to have cash on hand sometimes. To find the best prepaid debit cards for ATM withdrawals, we looked for those with the lowest fees for both in-network and out-of-network ATMs, while taking widespread ATM access into consideration.

Affinity Plus Federal Credit Union Visa® Reloadable Prepaid Card — $0 in-network and out-of-network ATM fees

Affinity Plus Federal Credit Union Visa® Reloadable Prepaid Card As you might expect, banks don’t often allow you to make ATM withdrawals at other banks for free. Affinity Plus Federal Credit Union does things a little differently with its Visa® Reloadable Prepaid Card: There are no fees for using both in-network and out-of-network ATMs. Also, there are no fees for account maintenance, purchases, cash deposits or inactivity.

The card costs $4.95, whether at an Affinity Plus branch or online. You can load any amount between $20 and $5,000.

Headquartered in St. Paul. Minn., Affinity Plus FCU serves the Minnesota community, with branches throughout the state. To become an Affinity Plus FCU member, you must work or volunteer at select organizations, attend or have graduated from select schools or live, work or worship in select Minnesota cities. You may also be eligible through relatives or roommates with which you live. You can also join by making a one-time $25 dues payment to the Affinity Plus Foundation.

Navy Federal Credit Union GO Prepaid Card — $0 in-network ATM fee, $1 out-of-network ATM fee

Navy Federal Credit Union GO Prepaid Card Already one of our best low-fee prepaid debit cards, the Navy Federal Credit Union GO Prepaid Card also offers one of the best out-of-network ATM fee deals — $1. Just keep in mind that the ATM owner may charge additional fees. The card also has no fees for monthly maintenance, card activation, ownership and purchases.

You’ll have to be a member of Navy Federal Credit Union who is at least 18 years old with a Social Security number and primary ownership of a Navy Federal savings account to be able to open a GO Prepaid Card. Membership is open — but not limited — to active-duty members of the military, veterans, select Department of Defense employees and immediate family members of eligible service members.

UFCU ABILITY Card — $0 in-network ATM fee, $1 out-of-network ATM fee

UFCU ABILITY Card University Federal Credit Union offers ABILITY Card holders access to over 300 UFCU Alliance ATMs. But if you find yourself using an out-of-network ATM, UFCU will charge only a $1 fee for each transaction. Still, while that’s the lowest fee you’ll find, try to stick to using in-network ATMs, especially since non-UFCU ATM owners may also charge fees. Avoiding an out-of-network ATM fee pileup can be helpful since there is already a $5 monthly fee to keep the card.

To open an ABILITY Card, you’ll need at least $25, although there’s no opening fee for UFCU members. There are no fees for reloading, but you’re limited to $1,000 in withdrawals and $2,000 in purchases per day.

You’ll need to be a member of the credit union to open an ABILITY Card. You can join UFCU if you’re employed by a company, enrolled in a school or belong to an association in the credit union’s field of membership. You can also join if an immediate family member is a member or if you join the University of Texas Longhorn Foundation.

UFCU has locations and ATMs across central Texas and Galveston County, and offers members access to hundreds of National Shared Branch Network locations as well.

The best prepaid debit cards for cash deposits

You shouldn’t have to pay to keep your cash safe in an account, but many prepaid cards charge a fee when you reload the card with cash. The best prepaid cards for cash deposits are those that not only offer the service for free, but also offer the ease and convenience of being able to reload at thousands of locations.

American Express Serve® Free Reloads Card — $0 cash deposits at select locations

American Express Serve® Free Reloads Card The American Express Serve® Free Reloads Card provides access to the largest network of locations to make free cash reloads on your card. It has over 45,000 locations, including retailers like CVS, Family Dollar, Rite Aid and Walmart. Direct deposits and bank transfers are also fee-free. The card also includes Early Direct Deposit, which allows you to get your paychecks deposited on the card up to two days early.

The card costs $0 to open online, but up to $3.95 at retail locations. There is a $6.95 monthly fee unless you are a Texas, New York or Vermont customer. Also be mindful when using ATMs, as you can get charged $0.75 each time you enter an invalid PIN, exceed your ATM withdrawal limits or you have insufficient funds.

Bluebird by American Express — $0 cash deposits at Walmart

Bluebird by American Express In addition to being our top low-fee prepaid debit card, the Bluebird by American Express card is also great for cash deposits. You can add cash to your Bluebird by American Express card for free at virtually any Walmart checkout register. Having a personalized card allows you to add between $1 and $1,999. You can also add cash at other participating locations, including CVS, Walgreens and 7-Eleven, although these merchants will charge a fee up to $3.95. Other free reload options are direct deposit and from a debit card. Master Account holders can also deposit money for free with 10-day Mobile Check Capture by Ingo Money.

You can open a Bluebird account for $5 at a Walmart store, online or on the Bluebird Mobile App through the App Store or Google Play. There is no Bluebird monthly, annual or activation fee. You can use your card to make purchases anywhere American Express is accepted. To withdraw cash from the card, you can do so for free at any MoneyPass ATM or for a fee at out-of-network ATMs or through Cash Pickup Powered by Ria.

The best prepaid debit cards for direct deposits

Debit card issuers often hold paycheck funds for a few days after an employer notifies them of a direct deposit. These best prepaid debit cards for direct deposits can bypass that waiting period and get you your paycheck up to two days earlier, without charging an extra fee for this handy service.

RushCard Prepaid Visa — $0 early direct deposits

RushCard Prepaid Visa Our first pick is the RushCard Prepaid Visa, which allows free and early direct deposits. RushCard puts direct deposit funds — including employer paychecks, government benefits and tax refunds — in your account as soon as they are notified of the deposit.

You can deposit cash without a RushCard fee at thousands of retail locations, including CVS, or through services like MoneyPak. While RushCard won’t charge you for these cash deposits, there may still be a third-party fee. There may also be fees for check deposits and cashing checks.

You can open a RushCard Prepaid Visa on one of two different plans. The Unlimited Plan allows for unlimited purchases and costs either $5.95 a month with direct deposit or $7.95 a month without direct deposit. But if you feel like you won’t use the card all that much, the Pay As You Go Plan might be a better option. There is no monthly fee; instead, you pay $1 per purchase. While it advertises no activation fee, there is a $3.95 or $9.95 fee when you first fund your card or change the design (the exact fee depends on the card design you choose).

The RushCard Prepaid Visa is issued by MetaBank, which is insured by the FDIC.

Green Dot Prepaid Card — $0 early direct deposits

Green Dot Prepaid Card Making direct deposits on your Green Dot Prepaid Card is the best way to load this card. Not only are they free, but you can get access to your paychecks up to two days earlier than usual, like with the RushCard. Cash reloads, on the other hand, can cost up to $5.95 in third-party fees.

The Green Dot Prepaid Card does charge a $7.95 monthly service fee. However, loading at least $1,000 on the card in a month will waive the service fee for the following month. Setting up direct deposits can be extra beneficial here since direct deposits, unlike cash reloads, are free.

You can buy and open a Green Dot Prepaid Card for up to $1.95 only at participating stores, either as a Mastercard or Visa.

Netspend Prepaid Card — $0 early direct deposits

Netspend Prepaid Card The Netspend Prepaid Card is another great option if you’re looking to get your paychecks direct deposited early. You can get paid up to two days faster when you set up free card reloads through direct deposit. Cash deposits cost $3.95 for each reload.

The Netspend Prepaid Card is available in three different plans. The Pay-As-You-Go-Plan charges a fee per transaction instead of a monthly fee, making this choice best for occasional use only. If you’ll need the card more often, consider the Monthly Plan, which charges a flat monthly fee, which can vary depending on the issuer. You can also upgrade to Netspend Premier, which cuts your monthly fee in half by enrolling in direct deposit and having at least $500 direct deposited into your account each month.

The card is issued by either Axos Bank, The Bancorp Bank, MetaBank or Republic Bank & Trust Co.; you can check the issuing bank on the back of your card.

The best rewards prepaid debit cards

Having a prepaid debit card doesn’t mean you don’t deserve rewards. The following cards offer the best rewards programs you’ll find among prepaid debit cards.

American Express Serve Cash Back — 1% cash back on purchases

American Express Serve Cash Back — 1% cash back on purchases The American Express Serve Cash Back prepaid card earns unlimited 1% cash back on all purchases rounded to the nearest dollar. Plus, the cashback rewards are added directly to your account after each purchase, so you don’t have to wait for the end of the month for rewards.

Your rewards can help offset the card’s $7.95 monthly fee (unless you live in Texas, New York or Vermont, where there is no fee). There is also an opening fee of up to $3.95 if you don’t open the card online and a cash reload fee of up to $3.95. There are no fees for direct deposit, bank account transfers, MoneyPass ATM withdrawals or sending/receiving money.

Netspend Prepaid Card — cashback rewards

Netspend Prepaid Card Already a great option for direct deposits, the Netspend Prepaid Card is also a solid rewards prepaid card. Through Netspend Payback Rewards, you can earn cash back on your purchases, with rewards customized according to your spending habits. You activate reward offers online in your Netspend account, then use your card at selected retailers to redeem the rewards.

In addition to direct deposit, you can fund the NetSpend Prepaid Card for free via account transfers between other Netspend accounts. Reloading with cash or Mobile Check Load on the app, however, will result in a fee. Accessing cash through an ATM will also cost $2.50.

The Netspend Prepaid Card charges a monthly fee on its Monthly Plan and Netspend Premier cards. The Pay-As-You-Go Plan allows you to do just that: pay per transaction, which should be occasional so as not to lose money to fees. Regardless of your plan, be careful of the $5.95 inactivity fee that is charged per month after 90 days without transactions. The card is issued by either Axos Bank, The Bancorp Bank, MetaBank or Republic Bank & Trust Co., which you can check on the back of your card.

Walmart MoneyCard by Green Dot — 3% cash back

Walmart MoneyCard by Green Dot The Walmart MoneyCard by Green Dot works best for loyal Walmart customers. You can earn 3% cash back at Walmart.com, 2% cash back at Murphy USA and Walmart fuel stations, and 1% cash back at Walmart stores. In total, you can earn up to $75 cash back each year. While you’re spending at Walmart, you can also get cash for free at participating Walmart MoneyCenters and customer service desks.

It costs $1 to open a Walmart MoneyCard at a participating Walmart store. There is also a $5 monthly fee unless you load $1,000 or more on the card each month. You can reload your card for free with direct deposit, Walmart check cashing and online bank transfers. You can even receive your direct deposits up to two days earlier, too, with ASAP Direct Deposit™. Reloading the card with cash, however, can cost up to $5.95, depending on the retailer.

What is a prepaid debit card?

If you’re not familiar at this point, a prepaid debit card works much like it sounds. You load money on the card, whether with cash, a check or direct deposit. Unlike a regular debit card, prepaid debit cards aren’t linked to a checking account. And although prepaid debit cards are offered by the main issuers of credit cards, prepaid debit cards aren’t like credit cards at all, where you borrow money and pay it back later. With a prepaid card, you’re spending the money in real time. Plus, you cannot spend more than you have on the card, preventing messy overdrafts and fees.

Why should you use a prepaid debit card?

  • You don’t have access to a bank account: According to the FDIC, about 8.4 million U.S. households were unbanked in 2017, meaning they did not have an account at an insured financial institution. Although many banks offer prepaid debit cards, you don’t have to have a checking or savings account to have a prepaid debit card. Prepaid debit cards allow you to deposit the cash or checks you do have and use the card to make purchases or pay your bills. This comes in handy for online payments or when stores have gone cashless.
  • Prepaid debit cards don’t require good credit: If you have bad marks on your credit history, it can be difficult qualifying for a credit card or opening a bank account. Prepaid debit cards come with little risk to the issuer, so they typically won’t check your credit report. That makes it a payment option even for folks who have bad credit. If that applies to you, use the prepaid debit card as a tool to improve your spending habits. The card may not boost your credit score, but you should still be responsible when using the card.
  • Prepaid debit cards can be cheaper than alternative money services: Without a debit or credit card or checks, there aren’t many ways to send money securely. Money orders are one option, although they come with their own set of fees that can pile up. Sending and receiving remittances, and even check cashing come with their own sets of fees charged per transaction. Prepaid cards serve the middle ground, offering convenient payment and low fees. You can find the best prepaid cards for low fees and ATM withdrawals above.
  • You want to lessen the risk of online payments: While technology has made our lives a lot easier to send and spend money, it has also made money easier to steal. One wrong click, and fraudsters could have your bank account numbers in no time. Using your prepaid debit card limits exposure to your bank account. Even if the prepaid card number is stolen, the thief can use only what’s on the card at that time rather than all your savings.

Are prepaid debit cards safe?

Generally, if you obtain a prepaid debit card, your money will be FDIC-insured through the issuing or partner bank. Additionally, thanks to a new rule from the Consumer Finance Protection Bureau (CFPB), there are more protections in place for prepaid debit cardholders. Through this rule, you can monitor your accounts online more easily and protect your money if a card is lost, stolen or incorrectly charged. The CFPB will also ensure you’re provided with honest and upfront information about card policies and fees so you can really find the best fit.

Advertiser Disclosure: The products that appear on this site may be from companies from which MagnifyMoney receives compensation. This compensation may impact how and where products appear on this site (including, for example, the order in which they appear). MagnifyMoney does not include all financial institutions or all products offered available in the marketplace.

Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

TAGS:

Advertiser Disclosure

Banking

Are We Heading for a Cashless Society?

Editorial Note: The editorial content on this page is not provided or commissioned by any financial institution. Any opinions, analyses, reviews, statements or recommendations expressed in this article are those of the author’s alone, and may not have been reviewed, approved or otherwise endorsed by any of these entities prior to publication.

One hundred dollar bill on fire cashless society
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Has it happened to you yet? Let’s say you drop by the new cafe on the corner to pick something up, only to find that they don’t accept cash. For many people, it’s no big deal. Most consumers already have several cashless payment methods: credit cards, debit cards and mobile wallets on their phone. You can even pay by smartwatch.

Nevertheless, cash persists as people’s preferred payment method. According to 2018 research by the San Francisco Fed, cash remains the most frequently used way to pay in the U.S., representing 30% of all transactions and 55% of transactions under $10.

Retailers meanwhile are eager to get rid of cash. A 2017 poll of retail executives commissioned by payments platform solution developer Adyen found that up to 78% of respondents were considering cashless stores that only accept cards and digital payment methods.

Does that mean we’re heading for a completely cashless society? That’s probably years if not decades away, however it’s not too early to examine the implications of cutting out cash.

The push toward a cashless society

Many consumers already live a relatively cashless lifestyle without even making a conscious switch.

Debit and credit cards have been part of the financial landscape for decades. The credit card started with the Diners Club card in 1950, while the first debit card pilot program began in 1966. Today, both payment methods are accepted practically everywhere, with the underlying technology evolving to include encrypted EMV chips for faster and more secure transactions.

Then there’s the ongoing shift toward contactless and mobile payments. Many merchants let you pay on your smartphone through Google Pay and Apple Pay with a quick scan. Newer physical cards are also offering contactless payments, requiring you to simply wave the card over the point-of-sale card reader to complete your transaction.

But more and more, the decision to go cashless is made for us when retailers refuse to accept cash in the first place. Shake Shack restaurant mogul Danny Meyer made the switch at a handful of his restaurants in 2018 to improve the safety, efficiency and speed of transactions.

When met with criticism regarding the “socioeconomic implications” of cashless operations, Meyer defended the decision, asserting that the benefits “outweighed the unintended side effects for a small segment of our guests.”

Mercedes-Benz Stadium in Atlanta switched to an entirely cashless operation in March. Management cited faster transaction times and flexibility for price adjustments as major factors driving the change.

Then there are clothing retailers including Bonobos, Everlane, Indochino and Reformation, all of which have gone cashless. United and Delta airlines no longer accept cash at ticket counters or for in-flight food and drinks.

Who benefits when stores go cashless? Who gets left out?

The decision to go cashless largely benefits the retailers who implement the policy. Going cashless eliminates the necessity for having large amounts of cash on hand at retail outlets. It cuts out the costs of securing cash, like armored trucks and depositing cash into a business checking account. It also lowers the chances of being robbed.

Cashless establishments also cite more efficient transactions when cash isn’t involved. Paying with card takes mere seconds while handling cash can take a little longer. Over the course of months and years, those seconds add up to a need for fewer cashiers, lower costs and happier customers.

And while such an economy may be more efficient and less expensive for many, a cashless society creates very real and harmful problems for others. What happens to people who don’t have debit or credit cards?

Around 8.4 million U.S. households were “unbanked” in 2017, according to the FDIC National Survey of Unbanked and Underbanked Households. This means that 6.5% of U.S. households didn’t have an account at an insured institution in 2017. Additionally, 24.2 million U.S. households were considered “underbanked” in 2017, meaning that they had an account at an insured institution, but also used other nonbank financial services. These alternative services include money orders, check cashing, international remittances and payday loans.

Unfortunately, money orders and remittances can tack on fees, while payday loans can land already low-income households in debt.

Becoming a “banked” part of the population isn’t as easy as “just getting a bank account,” either. Per the FDIC study, the most commonly cited reason for not having an account was not having enough money to keep in an account. Approximately 52.7% of unbanked households chose this as a reason.

The second-most common reason for not having a bank account — at 30.2% of the unbanked — was distrust of banks. This mistrusting group also indicated that they were not at all likely or not very likely to open a bank account in the next 12 months.

The FDIC also found that 29.9% of unbanked households that previously had an account cited “bank account fees are too high” as their reason for not having an account anymore, and 24.9% cited “bank account fees are unpredictable” as a reason.

Millions of Americans face these tangible obstacles to opening a bank account, leaving them with few payment options. Cash is an easily accessible and incredibly liquid asset that allows unbanked Americans to make purchases. A cashless establishment excludes these unbanked customers and bars them from buying goods simply because they can’t afford a bank account. A cashless economy would only amplify this partiality.

Who is fighting against the cashless society?

In order to combat the blatant exclusion of unbanked customers, Philadelphia became the first major U.S. city to ban cashless stores in February 2019. The bill, an addition to the existing Philadelphia Code section titled “Fair Practices Ordinance: Protections Against Unlawful Discrimination,” prohibits retail establishments from refusing to accept cash as a form of payment. This includes posting signs on the premises indicating that cash payment is not accepted and charging a higher price to cash-paying customers. The bill goes into effect July 1, 2019.

San Francisco quickly followed suit, when the city’s Board of Supervisors voted to amend the Police Code “to require, in general, that brick-and-mortar businesses accept payment in cash in connection with the purchase of goods and services other than professional services,” in May 2019. The bill would go into effect 30 days after enactment, which typically occurs when the mayor signs the ordinance.

The state of New Jersey also enacted such legislation in March. The bill prohibits discrimination against cash-paying consumers, stating “A person selling or offering for sale goods or services at retail shall not require a buyer to pay using credit or to prohibit cash as payment in order to purchase the goods or services,” adding that sellers must accept legal tender when offered by the buyer as payment.

New Jersey is not the first state, however, to have such a law. Massachusetts has had a section in its laws regarding “Discrimination against cash buyers.” It states that “no retail establishment offering goods and services for sale shall discriminate against a cash buyer by requiring the use of credit by a buyer in order to purchase such goods and services.”

New York City has introduced a similar local law “to amend the administrative code of the city of New York, in relation to prohibiting retail establishments from refusing to accept payment in cash.”

The uncertain future of the cashless society

A completely cashless society would exclude millions of Americans from participating in the economy. Thankfully, we’re not there yet. Cities are leading the charge against a completely cashless society. However, the retail, finance and tech industries certainly know their profits increase from more card-based and digital payments, and less cold, hard cash money. It’s no accident that online banks are becoming dominant in personal finance, shifting the focus to mobile interfaces and transactions, freeing them and us from ever having to touch cash.

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Lauren Perez
Lauren Perez |

Lauren Perez is a writer at MagnifyMoney. You can email Lauren here

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