Well, she finally did it. Created her own credit card, instead of bashing and critiquing the rest. And only time will tell if this card, like the many others she pulls apart, will show cracks.
That possible drama aside, let’s talk about what this new product actually offers, shall we.
It’s Not a Credit Card
That’s right. The new “Approved Card” is not a credit card at all, but rather a prepaid card.
In other words, you can’t get into debt by using it, which is one of the biggest benefits being touted by Suze. And there is no credit check, no check cashing fee, no bank account required, no interest charged, and no overdraft fees.
It’s simply a Debit MasterCard, meaning you must add money to the card before you can actually go around spending with it.
How “The Approved Card” Works
As mentioned, it’s a prepaid card, meaning you must add funds to get it going.
There are three ways to add money to “The Approved Card,” including direct deposit, transfers from another one of your banks, or retail cash loads.
The first option allows you to have your paycheck automatically added to your Approved Card.
This method is pretty important, as you’ll get surcharge-free ATM withdrawals at more than 35,000 Allpoint® ATMs nationwide for 30 days after every direct deposit of at least $20 or more.
If you don’t use direct deposit, you’ll be subject to a $2.00 withdrawal fee, plus the fee charged by the ATM operator. Ouch!
The second option allows you to fund your prepaid card by transferring money from a checking or savings account.
Again, as long as you transfer $20 or more, you get surcharge-free ATM withdrawals for 30 days after.
The final option means adding money at a MoneyGram® or Western Union® location nationwide, and paying $3.50 to do so. Say it aint’ so Suze!
I don’t believe the final option provides you with surcharge-free ATM withdrawals, so this option could get particularly nasty in a hurry.
Once the money is loaded, you can use The Approved Card anywhere Debit MasterCard is accepted, though you can only spend what’s available on the card, unlike credit cards, which allow you to spend up to your credit limit.
The Approved Card Fees!
Even though Suze Orman has your best interests in mind, “The Approved Card” is fairly fee heavy, based on my reading of the terms and conditions.
Here’s a list of the fees:
– Card purchase fee: $3.00 per card
– Monthly maintenance fee: $3.00 (first month waived)
– Card replacement fee: $3.00
– Live agent customer service fee: $2.00 per call (one free call per calendar month)
– Paper statement fee: $2.00
– Bill payment fee: $1.00 – $25.00
– Allpoint ATM withdrawal fee: $2.00 (unless you meet requirements above)
– Non-Allpoint ATM withdrawal: $2.00 plus any fees charged by operator
– Domestic ATM balance inquiry fee: $1.00 (unless requirements met) plus operator fees
– Domestic ATM declined fee: $1.00 (unless requirements met) plus operator fees
– International ATM withdrawal fee: $2.00 plus any operator fees
– International ATM balance inquiry: $1.00 plus any operator fees
– International ATM declined fee: $1.00 plus any operator fees
– Over-the-counter cash withdrawal: $2.00 per transaction
Okay, there are lots of potential fees here. So what’s makes The Approved Card so great then?
Well, Suze Orman obviously wants you to use the card responsibly, in a manner that helps you avoid all the unnecessary fees.
But even so, you’re still paying a minimum of $3 per card, and $36 annually for the privilege of using The Approved Card. That’s $40 right there, plus the inevitable fee or two throughout the year.
The Approved Card Extras
That brings us to the extras afforded with “The Approved Card.” For one, you get a free TransUnion credit report and credit score with unlimited updates.
But it’s only free for one year, after which you’ll probably have to pay the standard $11.95 per month if you want to continue enrollment.
Additionally, you only get one credit score, not all 3. So it’s not all that much of a benefit.
You also get constant identify theft monitoring from TrustedID® for free, which I suppose could be beneficial.
And you can transfer funds from Approved Card to Approved card free of charge, which is handy if family members both have the cards.
Finally, the Approved Card will share information with credit bureau TransUnion, though the activity won’t be reflected in credit reports or Fico scores, yet.
Suze’s hope is that one day soon prepaid cards like hers will affect credit scores positively, though that will be determined by the TransUnion analysis.
All in all, The Approved Card doesn’t seem to offer anything groundbreaking. If cardholders follow Suze’s sound advice, it could be a good choice for consumers who aren’t responsible enough to carry credit cards.
But without the credit-building power of secured credit cards and potential rewards of standard credit cards, it doesn’t seem like the best deal out there.
In fact, you’re likely much better off with the ING DIRECT Electric Orange Checking Account instead, which pretty much works exactly the same without all the fees.
Would Suze have approved this if it didn’t have her name on it?