Discover recently introduced the Current card, a new kind of debit card for teens with built-in controls and notifications for parents. With the new ‘Current Card’, parents can add money to a card for their teens, set spending limits and receive e-mail or text message activity alerts. They can also track purchases and access exclusive discounts online. Teens get to choose from one of seven unique “teen card designs”.
What do you think? Is this is a good idea?
My son’s only two – so he’s not at that stage in his life yet, but I think this is a great idea if your teen wants to learn about personal finance and managing money and the dangers of credit cards. Start from the beginning by using this type of prepaid debit card and you can instill the proper value of using credit wisely and not spending what you don’t have. The fact that this is a debit card really helps with that. You can’t spend what isn’t available on the card!
The restrictions and control are definite features in my eyes. Being able to control what categories of purchases the card can be used for is a great concept. This could also be a great way to deliver a portion of a child’s allowance or what they make from a job – putting a portion of an allowance or earnings into savings is always something you should do.
Here’s what Discover says the benefits and features are for the card.
Current by Discover – Teen Prepaid Debit Card
- Debit Card for Teens with built-in parental controls
- Set daily, weekly, and monthly spending limits
- Restrict teen card use in unwanted shopping categories (e.g. liquor stores, tobacco stores, hotels, etc.
- Free Direct Deposit for parents & teens
- Free deposits from any credit card or bank account
- $0 fraud liability guarantee
- Withdraw cash at ATMs
- Get exclusive discounts at teen’s favorite merchants
- Free e-mail and text message activity alerts
- No minimum balances, loading fees, or credit check
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I keep reading the argument that people have too much going on to worry about their money. My response? If you worried about your money more, you wouldn’t be running around like a crazy person!
I just read a post by Ramit over at I Will Teach You To Be Rich and it struck a chord with me. The post talks about the importance of automating transactions to do the right thing be default. This is good, but what if you don’t have an extra $100 a month to move to a savings account? You need willpower and you need it now!
If you’re spending too much, too often on the wrong things, then personal finance is ABSOLUTELY about willpower. It’s about changing habits. If you’re automating a transaction to put money out of reach, that doesn’t change the habit. It just moves the location where you will go to get to your money when you want to spend it. For example, Ramit wrote:
If you think personal finance is about trying harder, ask yourself: How has that worked for you in the last month? The last year? Have you really saved more? Invested more?
With the problem we’re talking about though, trying harder is the wrong thing to attack here. If you’re trying anything, then you’ve got willpower. The point to attack is WHAT are you trying harder AT?
You need to change the desire to spend if you truly want to change the fact that you’re not saving. Willpower is required to make such a change. There’s no way around that. If you have willpower you’ll find a way to keep pushing. You’ll find another option out there. Maybe it’s a cheaper replacement for a necessity or cutting out something from your budget that you don’t actually need. That type of analysis will start the engine and willpower will provide the fuel.
One more general point – there’s a fine line between automating payments and “setting and forgetting”. If you want to stop losing money, start saving more, start making more, etc. You need to start PAYING ATTENTION to your finances. You need to learn how to manage money. Creating an automatic transfer doesn’t teach you anything. It just moves your money around when you’re not paying attention. If you don’t change your spending habits, you will find the money you have and you will spend it. Your habit will see to it that it tracks down what it needs. In this case, that’s your cash.
Change the habit and you will learn the importance of saving and investing.
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There’s a nice tips article up on BabyCenter.com with some helpful hints on cutting your grocery costs. Food is one expense you can’t completely eliminate so it’s important to find ways to prevent over-spending. Here’s a section of the article that I really liked. Remember your whole shopping experience is the store’s targeted marketing plan. There are people at every company’s whose job it is to get your to spend more. Fight back by understanding what their tactics are and how they work!
2. Understand how stores work
A basic understanding of merchandising can help you avoid overspending. These simple habits will go a long way toward keeping your budget in check:
• Walk briskly toward what you came to buy and avoid distractions along the way. For example, have you ever noticed that the diapers and milk are often at the back of the store? You’re forced to walk past a lot of temptation to get to the items you need most often.
• Products are displayed at the ends of the aisles in order to catch your eye. Think carefully about whether what you see there is really necessary — or a bargain — before you toss it in the cart. Many “featured” items are not bargains at all.
• As you peruse the aisles, bend over to check the prices on the bottom shelves and compare them to the cost of the items at eye level.
• Avoid buying the items displayed by the register. The magazines at the checkout stand cost much more per issue than they would if you had a subscription, and cookies in little packages cost more than a from a box. Almost everything near the register is there to inspire you to buy on impulse, not to save you money.
Tip: Make fewer trips to the store and you’ll find yourself with fewer chances to pick up a few extras you don’t really need.
Read the full article here.
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Do you check your receipt every time you make a purchase? When was the last time you went item by item and made sure that you paid the price you expected to pay?
This is something that we all should be doing, and it’s something that can pay off pretty quickly. It’s definitely something that I need to do more consistently and my shopping trip today was a perfect example. (Click to Continue…)
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Last month I gave you 1o things you could do right now to save money. Here are another 5 quick tips, so get ready to pocket some cash. Remember, as soon as you see an idea you think you can do, you can and must act. Don’t procrastinate, don’t let the opportunity to change something right now slide by. You can save more of your hard-earned cash, and you can do it now. I’ll bet that you’ll easily be able to do at least one of the things in the list below. Let’s go! (Click to Continue…)
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Bryan over at Frugal-Logic has a great post on why you should consider cutting soda from your diet. Besides the fact that a soda habit, and it IS a habit. Soda’s not cheap! And soft drinks aren’t the healthiest option either.
I loved soda! Like most of us, I used to drink it all the time. (Click to Continue…)
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Right now, this very minute you can stop what you can read this and act. Don’t procrastinate, don’t let the opportunity to change something right now slide by. You can save more of your hard-earned cash, and you can do it now. I’ll bet that you’ll easily be able to do at least two of the things in the list below. If not, either you’re lying to yourself and you really don’t want to save money, or you’re already on the path. Here are ten tips you can put into action right the moment you finish reading this. (Click to Continue…)
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Having fun can get expensive very quickly, especially when it comes to movies and television. Have you actually looked at your cable or satellite bill lately? The average person spends about $1,800 a year on entertainment – and that doesn’t even include eating out! So challenge yourself to make better choices and find alternate sources for the same entertainment you’re paying too much for now.
Try these four ideas to pay less for tv and movies! (Click to Continue…)
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How many times have bought something on impulse or worse – for the wrong reasons? One of the simplest and most effective changes you can make is to stop and think before you make a purchase.
If you can break the cycle of thoughtless purchasing and consumption you can take control of your spending and work towards affording the things in life you’re truly trying to save for.
Here are 7 things to ask yourself, so you can be certain that you’re making a smart decision.
(Click to Continue…)
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Ready to put some money back in your bank account? You've come to the right place.
