It seems like one of the hottest new things these days is a celebrity endorsing a debit card. Entertainers who have had their own card include Russell Simmons, Lil’ Wayne and The Kardashian sisters. Well, if you have been reading financial news lately, there is another celebrity who has decided to have her own card – Suze Orman.
The “Suze Card” is a prepaid card and, like other prepaid cards, you cannot go into debt with it because you can only spend the money that is loaded on the card. According to Ms. Orman, she “decided to create this card after I heard from so many people who were being taken advantage of by the tricks and traps of the banking industry. I want to help people who need a low-cost alternative to what’s out there, and who want to manage their money responsibly.”
This card sells for $3 and there’s a $3 monthly fee (waived for the first month). When someone uses this card, this information will be shared with one credit bureau in hopes that it will eventually help you build credit. The card does this by offering free credit reports, scores and free credit monitoring. However, these services are already available for free on the web from websites like CreditKarma.com. You can also obtain your three credit reports for free from AnnualCreditReport.com.
The Suze Card allows unlimited free use of Allpoint ATMs across the country each month, if you make a direct deposit or bank transfer to the card of $20 or more. Allpoint ATMs are in major retailers, like Costco, Target, Walgreens, Kroger and 7-Eleven.
On a negative side, there are 20 fees that can run up the bill, including:
- $1 for pay by check
- $2 per paper statement
- $2 per over-the counter cash withdrawal
- $2 per call to talk to a live customer service agent (after one free call per month)
- $3 card replacement fee
I enjoy watching Suze on TV and usually agree with much of her advice but I don’t really see the benefits of using her card. I know she has hopes that this will help people build credit but I don’t see how this will do that. The credit agencies do not care what you spend your money on. They are more concerned with how you handle your debt and if you pay your bills on time. If you want to build credit, the best way is to make sure you pay your bills each month. I don’t have a lot of debt (just our mortgage) or a lot of credit cards (I have one that is paid-off in full each month). I have been current on every bill I have ever had since I became an adult and, because of this, my credit score is above 800.
I think Suze may have good intentions with this card but do wonder what is in it for her. What are your thoughts on the Suze Orman card and prepaid debit cards in general?