The financial lockdown that hit RushCard customers -- and prevented them from being able to use their own money for days to pay their rent, buy groceries and cover their bills -- shouldn't be ignored by everyone else.
"At the end of the day, we're all vulnerable," said Curtis Arnold, founder of bestprepaiddebitcards.com. No money for gas? No money for food?
It's not exactly the right image for RushCards, the prepaid cards launched by Russell Simmons as "pocket banks" for young and low-income consumers who don't have bank accounts. Simmons even visited Detroit in 2006 for a hip-hop summit on financial empowerment.
As part of his early promotion of the cards, Simmons told me in a phone interview in 2006 that his strategy was to "cut down on the exorbitant expenses that go along with being broke."
During the crisis, Simmons tweeted on Oct. 26: "I created this industry for people who needed access. I'm proud of this innovation and the lives it has changed."
No doubt, many will use this crisis as a time to criticize the prepaid card industry and some of the risks associated with not opting for a traditional checking and savings account. We're hearing about class action suits as well. But, really, the rest of us can learn -- or relearn -- some financial lessons here as well.
Not being able to spend your own money has to be near the top of the list when it comes to financial anxiety in a world that's increasingly dependent on ATMs, debit cards, credit cards and online accounts.
"If your bank account was frozen for two weeks and you couldn't buy food or pay rent, that would be a horrible problem for many families," said Lauren Saunders, associate director for the National Consumer Law Center.
What can consumers learn from this latest dollar debacle?
--You need an emergency fund just in case the big guys have an emergency.
Many people who have paychecks or government benefits directly deposited onto prepaid cards do so because they cannot afford some of the high fees associated with some regular checking accounts. Some have had so many overdrafts that they're denied access to traditional checking accounts.
Even so, create a strategy for saving money elsewhere and not putting all your money in one account. Too much can go wrong if accounts freeze up. Perhaps one builds up some savings in a credit union account. Perhaps one builds up savings on another prepaid card. Perhaps one keeps at least a little cash at home, too.
--Pay attention to what's going on in your account.
"Make sure you know what's coming out of your account," said Saunders of the National Consumer Law Center, which wants to see added regulation for prepaid cards.
It's important for consumers to spot glitches early on in any account, including a credit card, checking or a prepaid card.
Data breaches also can lead to unauthorized charges on debit cards, Saunders said. Or maybe you buy something online but unknowingly sign up for a membership club with a monthly fee. It can happen. Pay attention to what has been automatically deposited or what money has been withdrawn from your account.
--Do not open a credit card, take out a mortgage or open a prepaid card just because you're a fan of a celebrity. "Never get a financial product based on an endorsement by a celebrity," said Arnold, who also is a founder of CardRatings.com.
Arnold noted that many prepaid cards once had a celebrity connection, such as the Suze Orman Approved Card, which has been discontinued, and the short-lived Kardashian card, which didn't get far after it was criticized for exceptionally high fees.
Arnold said it's important for consumers to review the variety of services and fees on prepaid cards, instead of focusing on the celebrity.
Several experts say the RushCard debacle shouldn't sour consumers on prepaid cards altogether. Some note that the several options are out there, including the Bluebird card from American Express or the Chase Liquid card.
Susan Tompor, the personal finance columnist for the Detroit Free Press can be reached at stomporfreepress.com.