VISA-Buxx program - charge cards for teens
Apr 06 '01
The Bottom Line Visa-Buxx is a good program and it could be very useful (especially with fewer fees). Presently (April 2001) the best choice would be US Bank issued Visa-Buxx.
VISA-BUXX is a relatively new program by Visa that allows parents to sign up their teenage kids (13 and over) for their own charge card.
How does it work?
Visa-Buxx card works like a regular charge card and is acceptable anywhere a regular VISA card is accepted. The amount of purchase is debited from the amount pre-loaded to the card. Parents load the VISA-Buxx card directly from their bank accounts or credit, debit etc. cards and thus they control the spending limit of the VISA-Buxx user. Additionally, program can provide parent monitoring of transactions and monthly statements delivered to both the parent and the teen. (for details on the program and to apply go to www.visabuxx.com )
Benefits: Such a card could indeed be beneficial for the teen teaching him or her how to manage a budget and be a responsible shopper. It will allow for a broader range of transactions (i.e. mail order and Internet) providing a measure of security (similar to regular credit card). It is safer to carry around then cash.
Risks: General Lost/stolen card rules apply to VISA-Buxx with similar fees. In some cases it is possible for the teen to go over the limit (how exactly is a bit of a mystery to me, however the cardholder agreements all carry provisions for such an occurrence). In that case, an over the limit fee will be charged. Remember, parent is the one who is ultimately responsible for the card.
Presently, there are five banks offering VISA-Buxx. Their programs are similar, however there are some significant differences. Mostly in the fees charged.
Comparison of the programs offered.
Annual fee: Bank of America - $15
Wachovia - $12
Bank One - $12 ($2 per month, called Monthly Reload Fee)
US Bank - none
National City - I love these guys! No annual fee, but "We may charge you a monthly
maintenance fee for the Card". May charge, or may not… Who knows?
All banks charge a fee (1-1.50) for ATM transactions (including ATM balance inquiry). Most charge in case you use "foreign" ATM. Bank One charges you regardless whose ANT it is. Wachovia allows two ATM transactions per month for free.
Paper statement (as opposed to a free e.mail or electronic statements) - $1 per statement (Bank One, Nat. City), $2 (US Bank)
Loading fees: Bank One - $2 for the first loading; Bank of America (except from BA accounts or cards) - $2 per loading; other banks - no fees apparent.
Inactive account (generally 90 days): $2 Wachovia and US Bank
Replacement cards: free (Bank of America for the first replacement) to $10 (Bank one and Nat.City)
All banks charge fees for refused transactions (from parents account) and for overdraft (teen spending more then he/she has on the card)
In any case before signing-up you teen read the cardholder agreements for the card.
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