Union Plus Prepaid Card: 5% Savings Account With Low $2 Monthly Fee

If you liked Mango Prepaid card with its 6% savings account (3.9% after $5 monthly fee) but you wished you could put in more than $5,000, here’s another one that does pretty much the same thing.

It’s called Union Plus prepaid debit card. It’s run by the same parent company as Mango, just marketed through a different channel with a slightly different configuration.

Like Mango, you open the savings account after you get the prepaid card. The savings account pays 5.1% APY for balance up to $5,000. Balance over $5,000 earns 0.1%. You must have recurring deposit into the card in order to keep the 5.1% rate on the savings account. I’m not clear how much in recurring deposit is needed but $50/month will probably do, as in Mango.

Although the rate on the savings account is lower than Mango’s (5.1% APY vs 6% APY), the monthly fee is also lower: only $2/month vs $5/month on Mango. Unions’ collective bargaining power might have something to do with it? Because the monthly fee isn’t tax deductible, a lower fee actually works better than a slightly higher rate. Taking into account the initial $5,000, the monthly $50, and the $2 monthly fee, the net yield comes out to 4.1%, slightly better than Mango’s 3.9%.

Same as what you do with Mango, if it bothers you that your monthly recurring deposits plus interest earned pile up there earning nothing, you can withdraw $600 at a time on an ATM. The ATM fee is $1.50 plus whatever ATM operator charges.

Earning 4% sure beats earning just 1% or below 1%. It’s an easy extra $166 per year. Double that to $332 if you are married and get one card for each person.

As an added benefit, you get to pick a card that supports a union. Some unions have a unique design art for the card. Some just have the generic art.

Adding up both Mango and Union Plus prepaid cards, you have $10,000 per person earning 4%, FDIC insured. They make twice as much as I Bonds paying less than 2% at this time.

***

The hypothetical couple with $1 million portfolio in my "double the bond yield" pursuit decided to move $5,000 from their emergency fund to this savings account. They will earn extra $166 per person per year with something that runs on autopilot.

Here’s their progress toward their goal of earning extra $3,400 per person per year by maximizing their advantages as individual investors:

[Photo Credit: Flickr user aflcio]

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Software picked, likely related posts:

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• Mango Prepaid Card: 6% APY Savings Account A Hidden Gem

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