Let me start by saying that I like Suze Orman. She helped me get my savings in order and set my investing path to retirement. I particularly like her mantra “People First. Then Money. Then Things”. That being said, I was shocked to hear about her new product “The Approved Card from Suze Orman”. Even more shocking was her Twitter feed last night, where she called Phil From PTMoney an “idiot”. The same Phil who successfully organized the first of its kind “Financial Blogger Conference”.
Now I would like to believe that it wasen’t really Suze Orman, but some PR person who is helping her promote the card. But the chances of that are less.
Andrea @ SoOverDebt also points out that Suze was not a fan of prepaid debit cards either.
From page 96 of The Money Book for the Young, Fabulous, & Broke (published in 2005):
I don’t think prepaid cards are a viable option, either, since they also aren’t going to help you build a reputation at the credit bureaus. If you can’t get a regular credit card, you are to get yourself a secured card and use it as a stepping stone to a credit card.
So why the sudden change of heart?
What is so special about this Approved Card. NOTHING NEW. Compared to other prepaid debit cards, maybe a buck or two less in fees.
In the description of this card, Suze says that it is an “easier, smarter way to be debt free”. When is paying unnecessary fees when you can get it free SMART?
Then there is the whole Credit Project.
The Credit Project is an analysis of transaction data by TransUnion, which is a consumer credit bureau. As part of this project we are sharing your Approved Card purchase, payment and other transaction information with TransUnion so that they can help us understand the correlation between that information and the information that is currently included in most consumer credit reports.
So all your purchase info will be sent to TransUnion for free in the hopes that one day they will influence your credit report and scores. Seriously? What has debit transactions got to do with Credit History?
As you can see, I’m really disappointed with this product because I know that it will be marketed like crazy and people will fall for it. So I beg you all to please weigh the cons before jumping into this card. And Suze, instead of calling respectable Personal Finance Bloggers names, defend your card and make us change our mind.
Please open a free checking account instead of going for a prepaid card.