In today’s society, it’s so easy to get access to credit; and because of this, consumers are drowning in debt up to their necks. Being $20,000 in debt is typical in today’s society!

Many consumers are in search of some helpful and legitimate strategies to help rebuild credit history, because of the continuous increase of consumer debt. Lots of people fear the “b” word (no, not that one)! The word “budget” usually sends a very negative image to most people’s minds; they think they have to pinch every penny and be forced to eat peanut butter and jelly sandwiches for the rest of their life. Thankfully, that’s all a myth! Making a great plan for controlling your debt and rebuilding your credit and credit scores, by using different types of credit cards can help eliminate your worries.

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 a journey of a thousand miles starts with the first step. Let’s take our first step and evaluate both secured and pre-paid credit cards and the pros and cons of each for your situation.

a.) Secured Credit Cards

Advantages- Having a secured credit card is a very easy and cost effective way to build your credit. These secured credit cards can also rebuild and improve damaged credit reports. They work exactly like a traditional credit card.

Disadvantages- One of the major issues with this type of cards, is that in order to “secure” the card, you have to deposit anywhere from $200 to $300 when you apply. This can be a pretty hefty requirement. They also have much higher interest rates (15% and up), additional fees like annual fees that may cost about $50. This card, despite its minor setbacks, is a great option for those who want to rebuild their credit.

b.) Pre-Paid Credit Cards

Advantages- Pre-Paid Credit Cards are a very useful tool, because they give you all of the flexibility and freedom of using your own money. They look, feel, and spend just like a real credit card; they can be used in any occasion that you would use a regular credit card. With these cards, you determine how much money you would like in the account by “loading” money, instead of the company offering you a credit limit based on your financial history. Almost everyone can be approved for this type of card, and yes….even if you’ve had a bad credit past.

Negatives-This may not be the best choice if you’re looking to establish or rebuild your credit. Pre-Paid cards may not report your repayment history to the credit bureaus. If the company doesn’t report back on your account, this type of card, unfortunately, will not improve your credit. If you look at all of your options available, and compare cards based on your needs, you’ll be just fine.

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.

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Ms. Linda Seamore is an advocate for personal safety, dedicated to teaching people how to protect their identity. After reading stacks of mail from identity theft victims, she came across www.Life Lock.com , the best in ID theft protection. Life Lock specializes in the prevention of identity theft vs. after the fact protection. Visit LifeLock and see how to protect yourself!