Guide to the Greenlight debit card for kids

Description

Greenlight is the debit card and banking app for kids and teens, complete with an educational investing platform for the whole family. With the Greenlight app, kids and parents have companion apps with two different experiences. Kids learn to save, earn, invest, spend and give — with parent approval on every transaction. Parents can choose the exact stores where their kids spend, manage chores and allowances, set parent-paid interest rates and more. Parents can also invest for their kids’ futures — college, first car or any other goals. Kids can’t spend what they don’t have. No overdraft fees. No overspending. No surprises. PARENTS CAN: – Invest for college — or anything else — with an easy, flexible platform – Send money instantly – Receive real-time alerts of kids’ spending activity – Turn card on or off from the app – Manage chores – Approve kids’ investments – Automate allowances – Put limits on spending – Set parent-paid interest rates – Manage access and budgets for ATM withdrawals KIDS AND TEENS CAN: – Track balances in Save, Earn, Invest, Spend and Give accounts – Receive money from friends and family – Manage their own budgets – Learn to invest in stocks of their choice and research their favorite companies – Set savings goals – Set up direct deposit for their paychecks – Use Apple Pay, Google Pay and Samsung Pay SAFETY FIRST. AND SECOND. AND THIRD – Greenlight comes with an EMV chip and parent-controlled PIN – No cash back at the register to curb unmonitored spending – Automated blocked categories for unsafe spending – Greenlight uses several security features to help protect your accounts from unauthorized access – Funds available through the Save, Earn, Give and Spend functionality are FDIC-insured, through our partner Community Federal Savings Bank – Funds available through the Invest functionality are not FDIC insured but may be SIPC insured through our partner DriveWealth, LLC. Our Support Team is available to help 24 hours a day, 7 days a week Your California Privacy Rights: https://www.greenlight.com/privacy/#your-california-privacy-rights Do Not Sell My information: https://www.greenlight.com/data-request/Greenlight Greenlight is a financial technology company, not a bank. The Greenlight app facilitates banking services through Community Federal Savings Bank, Member FDIC. The Greenlight card is issued by Community Federal Savings Bank, Member FDIC, pursuant to license by Mastercard International. Investment Advisors, LLC, an SEC Registered Investment Advisor provides investment advisory services to its clients. Investing involves risk and may include the loss of capital. We only use the Value of Investment within the app store screen to show how the app works. It does not represent real customer investments or accounts.

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Bankrates Take: Is the Greenlight Debit card worth it?

If you’re looking for a simple way to help your child learn responsible saving and spending habits, the Greenlight Debit card is easily one of the best kid-centric debit cards on the market. Though you can’t avoid fees, the card comes with a ton of unique tools like customizable chore lists, automated allowances and real-time spending notifications, and the level of money management control you get is more granular than what rival cards offer.

While Greenlight’s Savings Boost makes the basic $4.99 monthly plan a bit more valuable than many competitor offerings, the $9.98 Greenlight Max plan’s flat-rate cash back, higher Savings Boost and other perks should give you the best bang for your buck.

Greenlight details and features

The Greenlight debit card offers a variety of features designed to help children learn how to earn, save, spend and invest money.

Depending on which Greenlight plan you choose – Greenlight, Greenlight + Invest or Greenlight Max – you and your kids will have access to any or all of the following card benefits:

  • Debit card: All Greenlight plans offer debit cards for up to five kids. This is great for families with multiple children since your Greenlight monthly fee covers up to five individual debit cards.
  • Educational app: All Greenlight plans offer an educational app that helps kids track their balances, complete chore lists to earn money and more. Parents can also use the Greenlight app to turn their kids’ debit cards on and off – which means that if your child temporarily misplaces their Greenlight debit card, you can turn off the card’s functionality until the card is either found or replaced.
  • Core financial tools: All Greenlight plans give kids the opportunity to learn key financial concepts, like how to set a savings goal. Greenlight’s financial tools focus on saving, spending, earning and giving and can help you pass your financial values along to your children.
  • Parental controls: All Greenlight plans offer parental controls, including the ability to set limits on how much your children can spend in a particular category (such as gaming) or at an individual store.
  • Investment platform: The Greenlight + Invest and Greenlight Max plans offer a kid-friendly investment platform that teaches children the fundamentals of investing – including how to evaluate risk, diversify investments and how compound growth can increase their investments.
  • Greenlight black card: The Greenlight Max plan gives kids access to the Greenlight Black Card – a sleek, modern card that might help kids get excited about saving and spending.
  • Priority customer support: The Greenlight Max plan gives parents the opportunity to jump to the head of the customer support line.
  • Identity theft protection: The Greenlight Max plan gives everyone in your family access to identity theft monitoring, including fraud alerts and restoration services.
  • Cellphone protection: The Greenlight Max plan provides coverage for lost, stolen or damaged phones for up to five kids. (That’s as many as five phones that you no longer need to worry about.)
  • Purchase protection: The Greenlight Max plan offers purchase protection for any purchases made on the Greenlight debit card that are stolen or damaged.

Cardholder perks

No matter which monthly plan you choose, the Greenlight card should offer solid perks that can help kids save money and build responsible financial habits.

All Greenlight cardholders earn at least 1 percent on their average daily savings balance and get access to unique money management features and basic protections like FDIC insurance and zero fraud liability. But for a little extra, you can also unlock additional rewards opportunities and features, including the card’s cash back program.

The base Greenlight plan, available for $4.99 per month, will get the job done if you’re satisfied with a 1 percent Savings Boost, money management tools and education, but it may be worth opting for the Greenlight + Invest level (available for $7.98 per month) if you’re interested in additional features that help kids learn about investing and make it easy for parents to invest for their child’s future.

The third tier, Greenlight Max, may offer the best value. You’ll enjoy all the perks of the base and Greenlight + Invest tiers, plus an extra 1 percent Savings Boost (for a total of 2 percent earnings), as well as unlimited 1 percent cash back on purchases and exclusive perks like dedicated customer service and future limited-time offers on top of the rewards.

Here’s a quick look at some of the key benefits that come with the Greenlight card, depending on your plan:

Parental controls and money management options

The Greenlight program is made of three components that both the parent or guardian (the primary accountholder) and the child (sub-accountholder) can use: the sub-accountholder’s debit card, the sub-accountholder’s Greenlight mobile app and the primary accountholder’s mobile app. Kids can use the physical or digital version of the debit card to make purchases, while parents can use the app to:

  • Monitor and approve each purchase as it happens
  • Set general spending limits and limits on specific store or category purchases
  • Create chore lists and one-time tasks for kids tied to an allowance
  • Reload the card balance
  • Set up direct deposits to teens’ cards if they work part-time
  • Freeze and unfreeze each debit card

These features help kids get hands-on experience with budgeting and earning money while giving parents visibility and control over where and how much they spend. According to Greenlight’s research, the top transaction categories for kids and teens are grocery stores, gas stations, restaurants, online gaming and ATMs, so you can even set spending limits for each of these individual areas.

While many of these features are similar to those you’ll find on other kid-centric debit cards programs, Greenlight offers more in-depth customization options than most.

Savings features

The Greenlight card can also help kids learn the power of responsible saving decisions. You can set up “Savings Goals” toward big expenses like college or a car, or short-term purchases like games. Meanwhile, the “Round Up” feature can help pitch in by taking the leftover change from each purchase and putting it toward these plans or your child’s general savings.

You can take things a step further and teach kids the value of compounded interest with its “Parent-Paid Interest” rate you set yourself that accrues using the primary accountholder’s funds. You can set this rate at anywhere from 1 to 100 percent, allowing savings to grow at a much faster pace than you’d get with the typical APY and demonstrating how money can grow when you save.

Greenlight Gift

As with similar kid-centric debit cards, Greenlight offers a gift option that allows people outside your family accounts to load cash onto the card. Friends and family can send a gift of $25, $50, $75 or $100 via text or email, which can be redeemed easily through the app. Gift-givers can even designate how kids can use their funds—anywhere, at a select store or only toward their Greenlight Savings account.

Greenlight + Invest

A unique feature among debit cards for kids, the Greenlight + Invest monthly plan will unlock educational modules and parent-approved stock and ETF trading opportunities for your family.

Since it’s tailored for learning about the investing space, it’s built to be easily accessible. You can set your risk tolerance, establish your investment timeline and buy most U.S. market stocks with no trading fees to worry about. You can even buy into fractional stocks with as little as $1.

All the while, you’ll stay entirely in control since your child can’t make trades without your permission and the brokerage accounts are in your name as the primary accountholder. You decide how money is invested and how any gains are used.

The investment platform available with the mid-tier monthly plan is one of Greenlight’s most unique and compelling features and isn’t offered by competitors like Famzoo and Gohenry.

Exclusive Greenlight Max protections

Along with an extra 1 percent Savings Boost and unlimited 1 percent cash back on purchases, the Greenlight Max tier gets you several valuable perks that can easily make the extra cost worth it. Not only are these features—including purchase protection, cellphone protection and account monitoring—usually reserved for credit cards, but they can also come in especially handy for kids and teens.

The Greenlight card’s cellphone protection covers eligible damage, theft and breakdowns up to $600 per claim across up to two claims (or $1,000 in total reimbursement) each calendar year per card on your account. This is already a relatively rare and prized perk among credit cards, but the Greenlight plan stands out with the inclusion of breakdown damage over time and the fact that you don’t have to pay your cellphone bill with the card to be covered. Unfortunately, however, New York residents aren’t eligible.

Eligible purchases are also covered against damage or theft for up to $100 per item (up to $1,000 per year) for 120 days (90 days for New York residents) from the date of purchase or delivery if it was paid in full with the card and damaged or stolen. This purchase protection even covers popular consumables like beauty products, fuel, food and medications.

Greenlight Max also comes with robust account monitoring tools. While primary cardholders get a run-of-the-mill credit monitoring service through Experian, children get an extensive Child Monitoring Service that scours the web and dark web for their personal information, including their Social Security number, email address, phone number, banking account details, medical ID number and more. If your child’s information is compromised, you’ll even get a dedicated agent under the full-service identity restoration service to help you with next steps.

Considering this level of service usually requires additional subscriptions, the Greenlight Max plan could be a great resource to have in your corner if your child is still learning to be safe online.

Rewards rate

Depending on your Greenlight card tier, you can get unexpected value from its unique Savings Boost feature, flat-rate cash back or both.

All cardholders earn at least a 1 percent Savings Boost reward each month based on their average daily savings account balance (on balances of up to $5,000). That’s an impressive rate of return considering the current average APY is 0.60 percent.

Greenlight Max members fare even better, earning double the Savings Boost (2 percent) and unlimited 1 percent cash back on all purchases. Taken together, that’s much better than most cash back debit cards can offer.

While you may not earn enough via cash back or Savings Boost to completely offset your monthly Greenlight plan fees, they can still help young cardholders see how their savings can grow through responsible use.

How you earn

Without Greenlight Max, the only way to earn rewards from the issuer is through the 1 percent per annum Savings Boost that’s awarded monthly based on the child’s General Savings and Savings Goals balances. Subscribing to Greenlight Max doubles the Savings Boost to 2 percent, but every tier only earns these rewards on an up to $5,000 average daily savings account balance per family (with a maximum of five cards on your plan).

Savings Boost works by multiplying your child’s average daily savings account balance by the rewards rate and dividing the result by 12 to determine the monthly reward. For example, a $1,500 balance with the basic monthly plan would earn $1.25. This would then be added to the savings balance and apply toward the following month’s potential reward. This is essentially an issuer-funded increase to the child’s APY that makes compound interest more noticeable, encouraging smart saving.

Greenlight Max members also earn unlimited 1 percent cash back on all eligible spending, which gives young cardholders an excellent opportunity to practice earning rewards before they get a full-fledged rewards credit card. Only some debit cards earn rewards—let alone unlimited, flat-rate cash back. For example, the Discover Cashback Debit account, a popular cash back debit card, only earns 1 percent cash back on your first $3,000 in purchases each month.

How to redeem

All Savings Boost and cash back earnings are automatically added to your child’s savings and counts toward their next month’s Savings Boosts reward. This makes it easy for kids to save, with no need to worry about which redemption options will offer the most value.

Conclusion

Undoubtedly, the Greenlight card is a useful tool for raising financially-smart kids, teaching your children about the value of work, investment, and smart money management. It also effectively motivates them to perform their assigned tasks due to its allowance automation system.

Moreover, it monitors how, where, and when your kids spend their funds, which helps to ensure that they make sound financial decisions. And so, if these three basic card benefits appeal to you, you should consider acquiring them.

Nevertheless, our analysis shows that it compares unfavorably with other companies regarding cost. The Greenlight card is rather expensive. Options like Busykid and Famzoo come with top-notch features, making them seem undesirable.

Perhaps, suppose the company lowers the monthly subscription price. In that case, it can occupy a unique position in the industry because, apart from offering the card, it provides an app for families—which some of its competitors lack.

Try Greenlight Here

Greenlight Pros

Before signing up for the Greenlight card or any other debit card for kids, it’s important to consider what’s good—and not so good—about it. Here are some of the best reasons to consider a Greenlight card for kids.

  • Parents can set controls for spending and deposits, including tying transfers to accomplishments like completing chores, doing homework or getting good grades.
  • Notifications allow parents to track their child’s transaction history in real time.
  • Certain purchases are automatically blocked by Greenlight.
  • Greenlight’s savings rewards, debit card round-ups and cash back on purchases helps kids reach savings goals faster.
  • Kids can learn investing from an early age with a Greenlight + Invest plan.
  • Cash rewards offered with Greenlight Max can help kids grow their savings.
  • Kids’ balances are FDIC-insured up to the $250,000 limit.

The Greenlight debit card for kids could be a great fit if you want to give your children flexibility to spend while maintaining control over their accounts. The fact that Greenlight blocks certain transactions automatically is a nice plus, as some other debit cards for kids don’t do this.

How Much Does Greenlight Cost?

A subscription fee with Greenlight starts at $4.99 a month per family and come with cards for, at most, five (5) children. In addition, this basic subscription includes the following features:

• An educational app

• Essential financial instruments

• Parental restrictions

• Reward for Greenlight Savings (up to 1 percent interest on Savings)

• Saving, earning, investing, spending, and giving abilities

The next plan is Green + Invest, which includes everything in the Greenlight plan along with investing platforms. This plan costs $7.98. Lastly, they have the Greenlight Max, which costs $9.98. Again, it includes everything in the Greenlight + Invest package, in addition to the following features:

• Reward for Greenlight Savings (up to 2 percent interest on Savings)

• Cash Back (1%) on All Purchases

• Black Card with Greenlight

• Priority access to customer service

Identity theft safeguards

• Cell phone security

• Purchase security

It’s worth mentioning that the company will pay for your first month’s plan, and you can quit at any moment. There is a one-time price of $9.99 if you want to switch to a Custom Card.

“What are the costs connected with Greenlight?” you might ask. Except for the monthly price charged by the provider, there are no other covert or extra fees except if your kid loses their Greenlight Card. The first card replacement is free of charge. After that, for any other further replacements, you will pay a $3.50 card replacement fee. 

How Do You Get a Greenlight Card?

To get a Greenlight card for kids, you’ll need to visit the Greenlight website and enter your mobile phone number. Greenlight will text you a confirmation code, which you’ll enter on the website. From there, you can register and create your family’s account.

As the parent or guardian on the account, you’ll need to give Greenlight some basic information, including:

  • Your name
  • Names of the children you want to get a Greenlight card for
  • Mailing address
  • Email address
  • Your date of birth
  • Your Social Security number

You’ll also need to link an existing bank account so you can make transfers to your Greenlight account. You can provide either a debit card number or your bank account and routing numbers.

Here’s one important thing to note about getting a Greenlight debit card for kids: It’s only free for the first 30 days. Once the 30-day trial expires, a monthly fee of $4.99 applies. Greenlight waives the monthly fee but only if you have a Morgan Stanley CashPlus brokerage account and link it as your Greenlight account’s funding source.

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