Best Prepaid Phone Plans for October 2023

A prepaid card is a great option for people who may not qualify for an unsecured credit card or other types of credit cards. If you want to build credit — which is key to qualifying for a mortgage, auto loan and other financial products — consider opening a credit card. Secured cards are the best bet for credit newbies and often require a minimum $200 security deposit for an equivalent $200 credit limit, like the Discover it® Secured Credit Card. Through on-time payments and responsible spending, you can establish a credit score and be on your way to an unsecured, traditional credit card with a revolving line of credit. As mentioned, major carriers are also becoming more competitive with their prepaid phone plans. Their prices aren’t as low as companies like Tello or Mint Mobile, but family deals and potentially better coverage might make them superior depending on your cellphone needs.

For example, the popular prepaid cellphone provider Tello throttles 4G data to 2G speed on unlimited plans after you use 25GB. This is a common practice for prepaid plans, even for unlimited data users. Many prepaid plans allow you to bring your own phone, provided it’s compatible with their monthly plans.

Prepaid cards vs credit cards

An accidental tap on the screen can turn off your phone’s Wi-Fi, making you rapidly drain your data. Similarly, if you don’t get the right roaming package, good luck the next time you travel internationally. TracFone — Simple pricing and easy to use; inexpensive phones, carry-over minutes, screen view of number of remaining minutes. Recommended by WirelessGuide.org for infrequent users like emergency users and seniors.

Similar to credit and debit cards, prepaid cards charge a variety of fees. You can expect to incur a card opening fee, monthly usage fee, ATM fee, reload fee and foreign transaction fee with many prepaid cards. If you use your limits, your service stops until your next payment or until you buy additional usage. If you’ve been stung by overage fees in the past, prepaid phone plans are your best protective measure.

  • You may also incur ATM withdrawal fees of $2.50, check deposit fees ranging from $0 to 5% of the total check amount and a 4% fee on purchases made outside the U.S.
  • We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
  • Keep reading to learn more about how prepaid debit cards work and what makes them different from other cards.
  • Still, plans that offer hotspot data or international calling are worth considering.

While there are some situations where prepaid cards might be helpful, they can come with certain disadvantages. This means you can swipe or insert it into point-of-sale systems to make your purchases and, in some cases, use it at ATMs to withdraw cash. To better understand prepaid cards, read on and learn what they are and how they work. Before choosing a card, read the “fine print” to determine which option comes with the least amount of fees, so that they don’t eat up whatever money you deposit to the card. Use the physical card to make traditional payments in-store and withdraw money from ATMs around the world, and use the virtual card to make online purchases.

The Serve Prepaid Debit card, issued by American Express, offers a vast free ATM network with fee-free withdrawals and a vast, fee-free cash reload network. If you haven’t cut the cord for cable, you can also consider bundling your phone and cable service with different contract providers to potentially save more money. If you’re calling from another country, however, you’re likely to have a problem with your phone’s compatibility with local networks.

Advantages of Prepaid Cell Phones

Usage of prepaid cellphone service is common in most parts of the world. Such Advance Pay plans are often monthly plans with either Unlimited Voice/SMS/MMS (or monthly buckets for some of these) and Prepaid Data Volume Add-ons and throttling mechanisms. The amount of competition between prepaid mobile phone providers and improvements in cellular networks has put prepaid phone plans on par with contract plans. There are numerous carriers that offer unlimited talk, text, and data plans at competitive rates.

International Limitations

Prepaid cell phone providers can be classified as mobile virtual network operators (MVNOs) or traditional wireless carriers. The MVNOs focus on the prepaid phone business, leasing space on traditional carriers’ networks rather than having their own. Among well-known MVNOs are Virgin Mobile, Boost Mobile (a Sprint subsidiary), TracFone (a subsidiary of American Móvil, a Latin American wireless provider) and AllTel Wireless.

Don’t be discouraged if your credit score is bad, as there are plenty of credit cards that you can apply for without paying a deposit upfront. Before committing to a prepaid card, be aware of any fees that come with it. Some prepaid cards may charge cardholders fees for withdrawing cash, reloading a card, checking the balance or even making purchases. If you’re going to be spending an extended time in a country, another option is to buy a prepaid cell phone once you arrive. In almost every country, you get unlimited incoming calls for free. Maybe you’d like to use a prepaid cell phone for calls to or from other countries.

New Samsung Patents Reveal Stunning Rollable Phone Designs

The amount of money you can load onto a prepaid card will depend on the card issuer and bank account you’re transferring money from. Some issuers may set maximum card limits and some banks only allow transfers up to a specific amount each day. Our ZEN Mastercards are linked to multi-currency accounts that are managed through a simple mobile app. You can use the app to transfer funds from a bank account, Mastercard or Visa, or digital wallets like Apple Pay and Google Pay.

Advantages of Prepaid Cellphone Plans

The content on this page is accurate as of the posting date; however, some of the offers mentioned may have expired. Any opinions, analyses, reviews or recommendations expressed in this article are those of the author’s alone, and have not been reviewed, approved or otherwise endorsed by any card issuer. The content on Money Crashers is for informational and educational purposes only and should not be construed as professional financial advice.

However, it’s important to check with your mobile network provider to ensure that your phone is compatible with their network and the type of prepaid SIM card they offer. Keep in mind that a hard inquiry appears on your credit report every time you apply for a new credit card, which results in a temporary ding to your credit score. That’s why it’s important to research credit cards ahead of time and only apply for the card that will best meet your financial needs. Prepaid cards can be used to make purchases and pay bills, just like debit or credit cards. They are accepted nearly everywhere since they are often backed by a major card network, such as Visa, Mastercard or American Express. You can often find prepaid cards at checkout lanes when you’re at the supermarket, typically next to gift cards.

While a prepaid cell phone offers many advantages, it also can present problems for its users. One of the biggest problems is the cost per minute, a serious disadvantage for anyone who talks a lot on a cell phone. If you’d prefer to stick to the prepaid options at the Big Four carriers, AT&T offers the best value with its 6GB plan for $40 a month. (That’s after an autopay discount.) If you’re credit risk looking for data plans that cover more than one person, T-Mobile offers prepaid customers two lines with 10GB of data each for $80 a month. Prepaid cards may also come with fewer protections than your typical credit or debit card. The government has taken steps to provide legal rights for prepaid cardholders, like a pathway to reimbursement should you lose your card or have it stolen.

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