Prepaid credit cards help consumers stick to a holiday budget

Holiday shoppers across the United States know that with the promise of family gatherings, seasonal joy and endless plates of indulgent food comes the stress of crowded shopping districts, the pressures of gift giving and the worry of how to pay for it all. For the 2011 holiday season, Forbes estimated that monied consumers planned to spend an average of $1,850 on gifts for friends and loved ones. A Consumer Reports 2011 poll reflected that 53 percent of Americans planned to use a credit card to finance some or all of these purchases. Consumers attempting to set and stick to a strict budget may benefit from alternative credit such as prepaid credit cards so that the New Year is not met with debt collection letters. The Washington Post recently highlighted why more consumers were returning to credit for the 2011 season. Faith in economic recovery has been cautiously growing among consumers, and this balances with slowing unemployment. These customers are likely to use credit cards to buy big-ticket items such as plasma televisions or the iPhone 5. This behavior has come to categorize holiday shopping and may have some link to the credit crunch that markets have been experiencing over the past several years. Prepaid cards offer some advantages to both holiday shoppers and store owners. For the consumer, the prepaid cards do not require the collection of consumer credit data on the individual, and therefore it is easy to be approved. For the business owner, selling these prepaid cards not only invites an initial customer transaction but encourages further holiday spending for both gift givers and receivers. This solution provides an alternative for holiday shoppers who wish to avoid a short term loan or excessive credit card debt. The cards typically have minimum and maximum money lending amounts, but the consumer has freedom within that span to add any amount within the budget. These cards can also help consumers with low traditional credit scores can avoid debt during the holiday season. In addition to being an excellent stocking stuffer for students who will be heading off to college learn the valuable lesson of budgeting money from receiving a prepaid credit card as a holiday gift. Then whether or not that sweater fits won't keep anyone from enjoying a wonderful holiday.