Getting a Prepaid Credit Card For Your Teenage Kid

Information verified correct on September 24th, 2016
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While a credit card with a high spending limit seems like a bad idea to give to a teenager, giving them a credit card with some restrictions may be a good one.

What Is a Prepaid Credit Card?

A prepaid credit card is a card that functions much like a credit card but has money deposited onto the card before it can be used. In fact, it is not really a credit card at all because there is no credit that is advanced on it. You must prepay a certain amount of money and then you are able to use your card to purchase anything that you would normally be able to use a credit card for.

Why Give Your Child a Prepaid Credit Card?

Prepaid credit cards are an excellent choice for teenagers. You will discover some significant reasons to opt for this type of card for your teenager. Here are just a few:

  • Teach your child about budgeting
    There is no better way to teach your child about how to NOT spend beyond his or her means than with a prepaid card. Since prepaid credit cards must have money on them in order to be used, your child learns that in order to buy things, you must have money!
  • Give them a sense of independence
    The apron strings will need to be cut sooner or later and if you are teaching your children how to live responsibly while they are still in your care then you can rest easy when it is time for them to be on their own.
  • Give them an opportunity to manage their own money
    This is a great chance for your child to take charge of his or her own money and manage it. Once her or she sees how to use money wisely, there will be much less likely chance to abuse the privilege as her or she gets older.
  • Establish credit
    It is difficult for young people starting out to get credit. The reason for this is because they do not have credit yet established. Once they have some credit history established with a prepaid credit card, they are more able to receive consideration for credit by credit card providers.

There are several different types of prepaid cards available. Teenagers should be given the chance to establish themselves with credit in a more safe and controlled way with a prepaid credit card. Once they feel comfortable using a card this way, they will probably be able to use a real credit card more responsibly.

Comparison of Prepaid Credit Cards

Rates last updated September 24th, 2016
Available Currencies ATM Withdrawal Fee Reload Fee Initial Load Fee
ANZ Travel Card
ANZ Travel Card
AUD, CAD, EUR, GBP, HKD, JPY, NZD, SGD, THB, USD, AUD 3.50, CAD 3.00, EUR 2.20, GBP 2.00, HKD 20.00, JPY 260, NZD 4.50, SGD 4.00, THB 95, USD 2.50 1.1% of the value purchased $0 Go to site More
Flight Centre Key to the World Currency Card
Flight Centre Key to the World Currency Card
AUD, USD, SGD, NZD, JPY, THB, GBP, EUR, HKD, CAD USD 2.50, EUR 2.50, GBP 2.00, NZD 3.50, THB 80.00, CAD 3.50, HKD 18.00, JPY 260.00, SGD 3.50, AUD 3.50 1.1% of the total amount $0 Go to site More
NAB Traveller Card
NAB Traveller Card
AUD, CAD, EUR, GBP, HKD, JPY, NZD, SGD, THB, USD $0 per withdrawal on international ATMs and $3.75 per withdrawal at any Australian ATMs $0 $0 Go to site More
Rates last updated September 24th, 2016
Currency Conversion Fee Monthly Inactivity Fee Multiple Currencies on One Card Maximum Load Amount
ANZ Travel Card
ANZ Travel Card
3% $3 Yes $80,000 Go to site More
Flight Centre Key to the World Currency Card
Flight Centre Key to the World Currency Card
5.95% $0 No $10,000 Go to site More
NAB Traveller Card
NAB Traveller Card
4% $0 Yes $45,000 Go to site More
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Credit Cards Comparison

Rates last updated September 24th, 2016
Purchase rate (p.a.) Balance transfer rate (p.a.) Annual fee
Virgin Australia Velocity Flyer Card - Balance Transfer Offer
Enjoy a 0% p.a. balance transfer offer for 18 months and also earn 2 bonus Velocity Points in the first 3 months on everyday spend.
20.74% p.a. 0% p.a. for 18 months $64 p.a. annual fee for the first year ($129 p.a. thereafter) Go to site More info
ME Bank frank Credit Card
Enjoy a low and consistent interest rate on purchases and cash advances, combined with no annual fee.
11.99% p.a. $0 p.a. Go to site More info
St.George Vertigo Visa
Introductory offer of 0% p.a. for 18 months on balance transfers and 1% p.a. for 12 months on purchases, plus a low annual fee.
1% p.a. for 12 months (reverts to 13.24% p.a.) 0% p.a. for 18 months $55 p.a. Go to site More info
HSBC Platinum Credit Card
Receive a full annual fee refund and save $149 if you meet the $6,000 spend requirement. Enjoy a balance transfer offer and platinum card benefits such as complimentary insurances and concierge services.
19.99% p.a. 0% p.a. for 15 months $149 p.a. Go to site More info

* The credit card offers compared on this page are chosen from a range of credit cards has access to track details from and is not representative of all the products available in the market. Products are displayed in no particular order or ranking. The use of terms 'Best' and 'Top' are not product ratings and are subject to our disclaimer. You should consider seeking independent financial advice and consider your own personal financial circumstances when comparing cards.

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