Prepaid debit cards are cards that have been loaded with a dollar amount that you draw down with each purchase.  They are not tied to a checking account, so there is no worry about overdrawing your account and the fees that may be assessed for doing so.  Prepaid debit cards may be just the thing for those who do not have a checking account or for those who have gotten into debt using a credit card.  Unlike credit cards, prepaid debit cards don't charge interest on purchases either, so you may actually be saving money in the long run.  Prepaid debit cards can be a cost effective alternative to carrying cash or incurring check cashing fees.

These general-purpose cards can have considerable drawbacks though. Some prepaid debit cards come with multiple fees for ordinary use (fee types and amounts vary from card to card). If you already have a prepaid card or are thinking about getting one, consider the following:

• Go to the card’s website (usually it's printed on the back) to read the terms, conditions, and fee schedule. This information isn’t listed in its entirety on the card's packaging.
• Be sure the card doesn’t assess excessive fees. (Some charge $100 or more a year.)
• Keep tight tabs on the card. If it’s lost or stolen, you could forfeit the entire balance.
• When you load the card, use direct deposit. In exchange, many companies will waive the $5 to $10 maintenance fee.