Do you get your paycheck through a payroll prepaid debit card? If so, you may be losing more money than you realize.
Payroll cards are designed to give workers faster access to their money than paper checks, but most employees don't know about the excessive fees associated with these cards. Before you opt out of paper checks or bank deposits, you need to learn more about your payroll card. It could be costing you a small fortune.
According to the research firm Aite Group, an estimated $34 billion was loaded onto 4.6 million active payroll cards last year.
The largest issuer of payroll debit cards is NetSpend, a company that charges up to 18 different fees on a number of its cards. These fees represent everything from loading fees to to charges for inactivity, meaning that you did not use your card as often as they want. NetSpend isn't the only company guilty of charging these fees. Most prepaid issuers have various fees in place so they can make as much money as possible. Meanwhile, your paycheck gets smaller and smaller.
Recent surveys indicate that some workers are spending close to $30 a month on payroll card fees, despite a drop in the fees to make cards more competitive. That means they could be wasting nearly $400 a year from using a payroll card.
Analyze the fees associated with your payroll card to see if it is really worth the convenience. If not, learn to wait patiently for a check in the mail.