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American Express prepaid cards offer a convenient way to buy groceries, pay bills, and withdraw cash, with upfront fees and the backing of a reputable issuer. Their fees are still higher than the average debit card, however — and they don’t help you build your credit scores.
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Want the convenience of paying with plastic, without the responsibility that comes with credit?
Not interested in opening a bank account?
If you’re nodding your head, you might want to take a look at American Express prepaid cards. As with other prepaid debit cards, you load these cards with your own money, and then can use them wherever Amex is accepted. Since you can’t spend more than what you’ve deposited, they’re a less risky way to get started with plastic.
Prepaid cards don’t require a credit check because they don’t affect your credit scores. If you’re looking for a way to build your credit — while still keeping on some training wheels — a secured credit card might be a better fit. Learn more about the differences between debit cards and credit cards.
Getting and using an American Express prepaid card is simple. Here are the four basic steps involved.
You can register for a prepaid American Express® Serve® (Review) or American Express® Bluebird® card online for free. You must be 18 years old and have a Social Security number and an email address. (For the Bluebird card, you must be 19 if you live in Alabama or Nebraska, and can’t apply for the card if you live in Vermont.)
Alternatively, you can pay up to $3.95 (Serve) or $5 (Bluebird) to purchase your prepaid card from a big box store or pharmacy. Just note you won’t have access to the card’s full features until you register your account online.
When you’re ready to put money on your new American Express prepaid card, there are several different routes you can take:
You can now use your prepaid card anywhere American Express debit cards are accepted.
For example, you could…
When you’re picking up cash, you can raise your $2,500 limit to $2,900 by direct depositing your tax refund into your Amex prepaid account.
At any point, you can reload your card with more money using one of the methods mentioned in Step 2. Or, you can close your account without penalty; it’s up to you.
Once you’ve got an Amex prepaid card account, you’ll be eligible for a range of benefits, including:
Want a quick overview of the pluses and minuses of Amex prepaid cards? Here you go.
Amex offers four main prepaid cards that vary in fees and features. (Note that if you live in New York, Vermont, or Texas, you won’t have to pay monthly fees on any of the cards below.)
The shiniest thing about this card is it doesn’t charge any monthly fees. Its cash reloads are also free — as long as you do them at a Walmart. Once your card is registered, you can add between $20 and $1,999 at a time. Unlike the cards below, it also doesn’t charge foreign transaction fees (which will save you 2.7% if you purchase items abroad!).
We recommend this card: for most people. With no monthly fees and free Walmart cash reloads, this is our favorite Amex prepaid card.
While this card charges a $6.95 monthly fee, it’s waived any month in which you direct deposit $500 or more. Cash reloads cost up to $3.95 each, depending on the retailer.
We recommend this card: if you plan to direct deposit at least $500 into the account each month. Otherwise it’s not worth the monthly fee.
As the name suggests, the standout feature of this card is the fact you can reload it with cash for free at more than 45,000 locations. The $6.95 monthly fee, however, is unavoidable.
We recommend this card: if you plan to make more than one cash deposit per month at a location that’s not Walmart, especially if you live in NY, VT, or TX and won’t have to pay the monthly fee. If you live in another state and are planning to make cash deposits at Walmart, the Bluebird is a better option.
This is the only prepaid American Express card to offer rewards: 1% cash back on every purchase. Just note you’d need to spend $795 per month to make up for its $7.95 monthly fee.
We recommend this card: if you live in NY, VT, or TX, and can earn rewards without the monthly fee. It may also be worth it if you plan to spend more than $800 per month on the card and won’t be using cash reloads (which, at $3.95 each, could quickly drain your cash back earnings).
While Amex prepaid cards can provide an easy way to manage your money, they do come with fees.
If you can get a bank account and a debit card (we love this one from Schwab), we’d generally recommend that as a better choice, because you’ll have a wider range of options and will likely be subject to fewer fees.
Or, if you want to build your credit, we’d recommend looking into secured credit cards. Since your deposit serves as your credit line, they don’t come with the risk of falling into debt that unsecured credit cards do.
Susan is a freelance writer who specializes in turning complex financial topics into engaging and accessible articles. She's been writing about personal finance for six years, and was previously the senior writer at The Penny Hoarder and a staff writer at Student Loan Hero. Her personal finance writing has also appeared in publications like MarketWatch and Lifehacker.
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