You’re on the phone trying to book a flight and a hotel room for your vacation. However, your credit card doesn’t go through because of your bad credit. What do you do?

In this case, you may want to open a pre-paid credit card. This type of card is designed for people who have poor credit but need a credit card to make purchases. A prepaid credit card acts just like a regular Visa, MasterCard, or American Express, but without any monthly bills, annual fees, or interest rates. Best of all, you can apply and receive this card no matter what your credit history is. The limit on your card depends on how much money you put into it, therefore eliminating the potential to go over your credit limit. Think about it like a gift card and a checking account combined. You can use this card anywhere credit cards are accepted, once you’ve depleted all the funds on your prepaid card, you can’t spend anymore until you replenish your account.

There are a few downsides to a prepaid credit card though. First, there is an initial activation fee for when you first open the card. You’ll also have to pay a monthly transaction fee, an ATM fee for when you withdraw money, and possibly a small fee each time you make a purchase with the card. Another thing to consider is that even if you develop good spending habits with the prepaid credit card, it won’t improve your credit score because you aren’t actually buying on credit.

All of these fees may sound expensive, but a lot of the times, a prepaid credit card does more good than bad for those with bad credit. So if you’re bad at controlling your spending, and you don’t want the headache of dealing with overdraft fees, a prepaid credit card might be the right choice for you.