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How Do Prepaid Phone Cards Work - Can They Be Used Anywhere?

written by: spacegrrrl2012•edited by: Doreen Martel•updated: 3/15/2011

How do prepaid phone cards work? Fortunately, phone cards are easy to use, but don't get surprised by their hidden fees.

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    Prepaid Phone Cards

    A prepaid phone card can be a convenient way to make your phone calls, though not as cheap as making phone calls over the Internet. Since you're paying in advance, you won't have to worry about getting a bill. You can use a prepaid phone card from a pay phone, cell phone or regular land line, though there are certainly some things that you need to watch out for.

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    Prepaid Phone Card Basics

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    When you purchase a prepaid phone card, you are prepaying for a number of "minutes" of phone use, but this concept can be a bit misleading. Calls to certain countries can cost more than others, thus reducing the number of minutes that you use. For example, you might be able to make 60 minutes of calls to Mexico, but only 30 minutes of calls to Singapore.

    To make your phone call, you'll be connecting through an intermediary company -- the seller of the phone card -- to make your calls rather than calling the person directly.

    When choosing a prepaid phone card, think about how you'll use it and where you'll call most often. Compare your options and find a card with the lowest rates to your primary destination.

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    Using a Prepaid Phone Card

    On your card, you should find the specific instructions for your prepaid phone card. Most work in the following way:

    1. Call the main number on the phone card, which connects you to the phone card company.

    2. Enter your code. You can find this number directly on the card. It's typically a long string of numbers.

    3. Enter the phone number you want to call. If you're making an international call, you should be sure to include the country code.

    4. Listen to the recorded message telling you how many minutes you can talk before your money runs out. You will probably hear a warning message before the company cuts you off.

    5. Wait for your recipient to answer. You'll hear a beeping noise as the phone rings on the other end.

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    Things to Watch Out For

    Though convenient, prepaid phone cards can come with hidden charges, which makes them more expensive than calling the traditional ways. Look out for:

    • Connection fees. Every time you make a call, the company may charge a connection fee, ranging from a few cents to a couple of dollars. If you are making several short calls, this can quickly eat into your calling budget.
    • Increased per-minute charges based on the type of your phone. Though cards vary, the per-minute charge from a land line is typically less than the per-minute charge from a cell phone. The advertise rate is probably the lowest one, so you may be paying more for your calls than you think.
    • Rounding your minutes. Though a "minute" can seem like an easy concept to understand, it's important to think about what counts as a minute. Some companies round up based on a minute, while other companies round up based on 15 or 30 seconds. This subtle difference can cost you a lot of money over time.
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    How Do Prepaid Phone Cards Work?

    Prepaid phone cards are often a matter of following the directions on the back of the card. They're a convenient solution when you don't have a long-distance provider. However, the prepaid phone card companies do need to make money and they often do this through high fees. Choose the card with the lowest fees to the area you call the most, or research other options, like internet phone.

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    Resources

    Sources:

    1. Federal Communications Commission -- http://www.fcc.gov/cgb/consumerfacts/prepaidcards.html
    2. Zaptel -- https://www.zaptel.com/pages/phonecards_mobilephones.html

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