Greenlight Debit Card review: Kickstarting kids’ financial journeys

Adding your child as an authorized user to the Citi Double Cash® Card could be a great way to help them build credit and learn about rewards while you earn generous flat-rate cash back on all purchases. Even better, you’ll only earn the maximum cash back when you pay off your purchases (you earn 1 percent when you buy and 1 percent when you pay off those purchases), which encourages responsible use.

If you have a younger child, adding them as an authorized user on the Citi Double Cash would be the only option. There’s still the potential to demonstrate responsible money habits with the Citi Double Cash, but not nearly as in depth as what you could get out of the Greenlight debit card. Additionally, the Greenlight debit card is designed for use by younger children, unlike a traditional credit card. 

If a child is 18 or older, getting a secured card like the Discover it® Secured Credit Card in their own name is a solid option on its own or to pair with the Greenlight debit card. All Discover cards pose minimal costs, including no annual fee, foreign transactions fees, penalty APR or fee on your first late payment (up to $41 after that). It doesn’t require an established credit score to apply, and since its credit limit is set by your security deposit of $200 to $2,500, you won’t have to worry about card spending getting out of control. It’s also one of only a handful of secured cards that earns cash back and you could get Discover’s first-year Cashback Match offer, which essentially matches all the cash back earned at the end of the first year.

The main drawback to a secured card is the required security deposit, which could be much more than some are willing to pay upfront. While the Greenlight debit card does have a monthly fee, these fees are far less expensive than a minimum $200 security deposit. If you are older or even a college student, one of the best student cards could be the most worthwhile pursuit because of their lower credit requirements and student specific perks. 

Parents who want to start early with teaching young children about financial responsibility should take a closer look at the Greenlight debit card. While the card is explicitly designed to help young people navigate money early and responsibly, the parental controls also give parents easy access to maintain order during the process. 

Due to restrictions under the CARD Act of 2009, people under the age of 21 aren’t allowed to apply for credit cards. The exception to the rule is people 18 and up who can provide proof of independent income. If you’re someone who can’t or isn’t ready to handle the weight of managing a credit card, getting started with something like the Greenlight debit card can help you learn with lower stakes. 

The primary criteria for a rewards or cash back card’s rating is its rewards value. This includes the card’s average rewards rate, estimated annual rewards earnings, sign-up bonus value and reward redemption value.

To estimate a card’s average annual rewards earnings, we first calculate its average rewards rate based on how much it earns in different bonus categories and how closely its categories align with the average person’s spending habits, according to data from the Bureau of Labor Statistics. 

Based on this data, we determine a “chargeable” spend (which purchases are likely to be put on a credit card and earn rewards). This includes the following spending by category:

• Groceries: $5,200
• Dining out: $3,000
• Entertainment: $2,500
• Gas: $2,100
• Apparel and services: $1,700

Using this data, we assign a weighting to each of a card’s bonus categories. For example, a card’s grocery rewards rate receives a 23 percent weighting based on how much of the average person’s budget is spent on groceries. We also estimate the redemption value of points or miles from various issuer, airline and hotel rewards programs.

This weighting and rewards valuation allows us to estimate a card’s average annual rewards earnings — how many points or miles you’d earn with a given card if your spending was about average and you used the card for all of your purchases, as well as what those points are worth. We also use point valuations to determine a card’s sign-up bonus value

With these calculations complete, we assign each card a score based on how its average rewards earnings, sign-up bonus value, rewards rate and redemption value stack up against other rewards cards.

We also rate cards based on how much it costs to keep them in your wallet or carry a balance. 

To start, each rewards or cash back card is scored based on whether it offers an intro APR and how its ongoing APR compares to the rates available on other rewards or cash back cards. 

We also score each card based on how its annual fee influences its overall value. 

We consider a card’s annual fee in two ways — how it ranks relative to the fees you’ll find on other cards in the category and how it impacts a card’s overall rewards value. Cards with an annual fee will always be at a slight disadvantage in our scoring system since annual fees inherently cut into your rewards value, but if a card offers terrific value via its ongoing rewards and perks, it can earn a high score even if it carries a high annual fee. 

With this in mind, we rate a card based primarily on how its ongoing rewards value and ongoing perk value (such as annual credits or bonuses) stack up against other cards in the category when you subtract its annual fee.

We rate each card’s flexibility based on the restrictions it imposes on earning and redeeming rewards and factor this rating into a card’s overall score. 

Flexibility factors include whether a card only allows you to earn a high rewards rate on a small amount of spending or requires you to meet a certain earning threshold before you can redeem rewards. We also examine whether your points are worth less when you redeem for some options versus others and whether a card gives you the flexibility to transfer rewards to airline and hotel partners. 

We also score each card’s set of features – its perks and benefits — against five tiers of features to provide a rating. 

We break down these tiers as follows:

• Tier 1 has less than standard card features (an ultra-streamlined card that offers basic utility and next to nothing in the way of ancillary benefits. 
• Tier 2 includes the benefits you’d expect on standard Visa or Mastercard credit cards, such as free access to your credit score, car rental insurance and $0 liability for fraudulent charges. 
• Tier 3 includes “prime card” or better-than-average card features like cellphone insurance, lost luggage insurance, concierge services and purchase protection. 
• Tier 4 includes luxury features such as airport lounge access, elite status with an airline or hotel and credits for expedited security screening membership programs. 
• Tier 5 includes the sort of exemplary benefits you’ll find on top-tier luxury cards, such as high-value travel credits, cardholder memberships and other unique and valuable perks.

Compared to Famzoo and Gohenry, two of its most popular competitors, the Greenlight Debit Card offers similar spending management tools, chore list customization and allowance automation at its $4.99 per month tier, but its savings account settings and rewards set it apart from the crowd. Greenlight offers more detailed parental controls than these competitors and its investing capabilities, flat-rate rewards and Mastercard benefits are hard to match.  

Yes, if you feel like the Greenlight + Invest or the Greenlight Max plans are a better fit, or if you aren’t able to take full advantage of the higher tiers’ perks, you’ll be able to upgrade or downgrade your Greenlight card plan at any time once per billing cycle.

Parents can set spending limits on set categories and at specific stores or freeze the child’s card at will. This detail allows parents to have a final say on what the card can be used for. 

• You’ll have access to a digital card after you apply, but it will take seven to 10 business days to receive a physical debit card via free shipping.