Greenlight Card Review - Nasdaq

Giving kids a debit card can be an excellent way to help them learn the basics of money management. Research shows that teaching kids about money at an early age can help them grow into financially savvy adults—and fare better in their romantic relationships as well.

Several companies offer debit cards for kids, and Greenlight has emerged as one of the most popular options. With the Greenlight card, kids can spend, save and even invest securely all in one place.

Wondering if the Greenlight debit card for kids is a good fit for your family? Our Greenlight card review offers a closer look at how it works.

Greenlight Basics

Greenlight is a fintech company on a mission to help parents raise financially smart kids. The Atlanta-based company was co-founded in 2014 by Tim Sheehan and Johnson Cook; as of 2022, more than 4 million families have opened Greenlight accounts.

The Greenlight app is specially built with families in mind, and it’s designed for kids of all ages who are ready to start learning about money. Using the Greenlight card for kids, parents can teach their children about budgeting, spending wisely, saving and investing.

The Greenlight debit card is a secured debit card for kids, tweens and teens. This debit card bears the Mastercard logo and can be used anywhere Mastercard is accepted. Kids can even add a selfie to personalize their card design.

How It Works

The standard Greenlight plan includes the debit card for kids and access to the Greenlight app. Greenlight offers debit cards for up to five kids per account, which is great if you have a larger family.

Parents can load money onto the Greenlight card for kids to spend or save. You can send money to your child’s account manually or create recurring transfers. For example, if you pay your child a weekly allowance, you could set up automatic transfers so the money is deposited on the same day each week.

Transfers are scheduled through the Greenlight app. Adults on the account can also perform the following functions.

• Monitor balances
• Track spending and purchases
• Manage account controls
• Add chores or other conditions for receiving transfers
• Establish direct deposits
• Set limits for ATM withdrawals
• Set limits on purchases
• Freeze or unfreeze kids’ cards

Parents can set rules for where their children can make purchases, and they can receive notifications each time their kid uses the card. The card can be used anywhere Mastercard is accepted, but Greenlight does block transactions at certain merchants. For example, Greenlight cards can’t be used to pay for:

• Wires or money orders
• Security brokers or deals
• Dating/escort services
• Massage parlors
• Lotteries
• Online casinos or online gambling
• Horse racing and dog racing
• Non-sport internet gaming
• Cash back at the point of sale

Kids have access to the Greenlight app through their own dashboard, but they have a different set of controls. They can see how much money they have to spend and check their transaction history. Kids also have access to core tools in the app to help them learn about spending, saving, earning and giving.

Greenlight offers kids a 1% savings reward to encourage them to learn the importance of setting goals and the value of compounding interest. The savings reward is similar to interest your kid would earn from a traditional bank. Adults on the account can also activate “parent-paid interest” to help kids grow their savings faster.

If you’re wondering whether Greenlight is legit, the answer is yes. The balance on your child’s Greenlight debit card is insured by the Federal Deposit Insurance Corporation (FDIC) for up to $250,000. Greenlight is registered with the U.S. Securities and Exchange Commission (SEC) and is a member of both the Financial Industry Regulatory Authority (FINRA) and the Securities Investor Protection Corporation (SIPC).

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.

Other Greenlight Plans

So far, this Greenlight card review has focused on the standard Greenlight plan. But there are two other tiers to choose from: Greenlight + Invest and Greenlight Max.

Greenlight + Invest comes with all of the same features as a standard Greenlight account, including:

• Debit cards for up to five kids
• Greenlight app dashboards for adults and kids
• Parental controls
• Spending, saving, earning and giving tools
• 1% savings reward

Besides those features, parents and kids also get access to investing. You can start investing with as little as $1, and you have the option to purchase fractional shares of stock and exchange-traded funds (ETFs). Kids can research the investments they want to make, and parents can approve them through the Greenlight app.

Greenlight Max includes all the benefits of Greenlight + Invest, with a few nice additions. Instead of a 1% annual savings reward, kids with Greenlight Max plans earn a 2% reward. The Max plan also includes 1% cash back on debit card purchases, which is deposited directly in your kid’s savings account. Greenlight Max users also get access to other perks, including:

• Priority customer support
• Identity theft protection
• Cell phone protection
• Purchase protection

But more features and benefits mean higher monthly fees. With Greenlight + Invest, parents pay $7.98 per month. The fee for Greenlight Max is $9.98 per month. By comparison, the BusyKid card, another of the most popular debit cards for kids, has many of the same features as Greenlight and costs just $3.99 per month per child. So BusyKid’s only a better deal if you just need one card.

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.

Greenlight Cons

There’s a lot to like about Greenlight, but it may not be right for every family. In terms of the cons, here are the most important things to keep in mind.

• Greenlight isn’t free—you’ll pay $4.99 to $9.98 per month for this kids’ debit card and personal finance app.
• You’ll need to upgrade from the basic plan to unlock enhanced features and benefits.
• Greenlight doesn’t work with money transfer apps like Venmo, Apple Pay or PayPal, so you can’t use them to make deposits or transfers.
• You can’t add cash to the card at a bank or other in-person location as you can with some prepaid debit cards.

Greenlight has also received some negative reviews from consumers who have used this product. On Trustpilot, for example, there are numerous complaints about how difficult it is to cancel the service once you enroll because the only way to do so effectively seems to be calling customer service.

Bottom Line

The Greenlight card is an excellent way to introduce kids to the world of personal finance and money management. Giving them their own card to spend or save with makes it easier to understand concepts like the difference between wants and needs in a hands-on way. There are other debit cards for kids that charge lower fees, but the Greenlight card offers good value for the money, particularly if you have multiple kids.

Frequently Asked Questions (FAQs)

Is Greenlight a bank?

No. Greenlight is a fintech company that offers a personal finance app and secured debit card for kids. Greenlight cards are issued by Community Federal Savings Bank, which is a member FDIC financial institution.

Is Greenlight FDIC insured?

Yes. Balances held on Greenlight debit cards for kids are FDIC insured for up to $250,000. This FDIC coverage is provided through Community Federal Savings Bank.

What happens if the Greenlight debit card is lost or stolen?

If your child’s Greenlight card is lost or stolen, you can freeze the card through the Greenlight app. This can prevent any unauthorized purchases. You can then order a replacement card through the app.

How do you close a Greenlight account?

If you want to close a Greenlight account, you can fill out the online cancellation request form or call customer care at 1-888-483-2645. Based on consumer comments left on Trustpilot, you may want to skip the form and call directly to ensure that the account is closed and you won’t be charged additional monthly fees.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.