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In this day and age where most people have easy access to a consumer credit, Americans are finding themselves sinking deeper and deeper into debt. Racking up a mere $10,000 in debt is now easy and all too common.

People want a sure a proven way to improve their credit. This desire is certainly on the rise as people feel more and more pressure as they pile on more and more debt that they cannot afford. Going on a budget seems to be cruel and unusual punishment for many, as they often overlook the value of this system of financial planning. However, the use of a certain type of credit card may indeed help your credit and get rid of the idea that budgets are all bad.

Not only are these credit cards beneficial, they also provide for some consumers the only way out, especially if they’ve been denied a bank account or traditional credit card. Given that it takes two incomes in most households and a great majority of men and women both are in the workforce these days, there is hardly any time to prepare budgets and investigate ways to increase their credit scores.

They say that the way to eat an elephant is one bit at a time. Let’s take our first bit and analyze both secured and pre-paid credit cards, and the cons and pros with each for your situation.

Secured Credit Cards Advantages - Getting a secured credit card account is an easy and cheap way to begin boosting your credit. Damaged credit can also be improved with these types of cards. They can be used the same way in which you would use and Visa or Mastercard.

Cons - A major disadvantage to these kinds of cards is that you have to put money down in order to secure them. There is generally some sort of deposit that is required with your application. Lots of people find this to be challenging. They also tend to have a much higher interest rate than a standard card, something like 15% or more and can charge you additional fees. In spite of these negative points, they can be answer for those looking to better their credit rating.

Pre-Paid Credit Cards Pros - A pre-paid credit card can be a great way to provide you with the freedom and flexibility of having your own credit card, without having to be in debt. While these cards look and feel like every other credit card, and can be spent in all the same places, these cards require you to put money on the. In effect, you are spending your own money just like cash. The approval process for this type of card is easy and is a definite guarantee.

Cons - If you are looking to rebuild or establish your credit however, beware. These cards may not report your repayment history to the credit bureaus. If the creditor does not report your account, this type of account will not help you improve your credit. By carefully selecting these cards, you can assure yourself that you receive the most bangs for your proverbial buck.

You might also consider that Pre-paid cards cannot be used in all situations. For example: hotels and car rental agencies may not allow you to use a pre-paid credit card to secure your rentals. It’s always a good idea to call ahead first and ask each company their policy before entering into any transaction.