I am a registered user at Elance, although I’ve never really done too much with the website. A while back I looked into whether or not Elance was a legitimate way to find freelance writing gigs and came to the conclusion that while it might be fine for some people, that it just didn’t really fit within my freelance writing business model at the time, although I am preparing to re-evaluate that. You can see my analysis at is Elance worth it. You can also check out my look at is Guru.com worth it.
(Note on the above. I have a working theory that the big G gives different power to links that are not capitalized in the way that article titles usually are. The idea is that a link in the text of an article suggests that the anchor text is more genuine than when linking to a title. One way of differentiating the two would be looking at how they are or are not capitalized. – Does anyone have any info on this?)
A recent email about a new Elance payment option caught my attention. It is a pre-paid MasterCard. Since I load up most charges to get big credit card rewards that I can redeem for things like travel or cashback, I’m not sure it is for me. The high-end rewards in the Capital One rewards catalog, for example don’t come cheap.
I am always on the lookout for new developments or advancements in the freelance writing world, though, so I looked into it a little bit further to see if it was worth it or a scam.
Elance Pre-Paid MasterCard Payment Option
Getting paid for work at Elance is pretty much like getting paid for writing anywhere else. You and the client work out an arrangement and then, ideally, you both hold up your end of the agreement. An online writing gig website like Elance typically has a high percentage of users that will want to pay freelancers electronically via PayPal.
Getting paid by PayPal for writing is usually just fine once you figure the system out well enough. There are a couple of potential gotchas with PayPal. One is that you have to link a Social Security number to an account in order to withdraw more than $500 per month from a PayPal account. Another is that if you decide to play by the apparent “rules” and setup a business account, you can expect to be nickel and dimed to death by all manner of PayPal fees that the company apparently feels most businesses won’t mind since they get similarly dinged on credit card transactions and have built the cost into their pricing model. Also, transactions that come in foreign currency can have some hefty charges levied onto them.
Otherwise, if you link a personal PayPal account to your SSN, things generally work out. Although, you want to transfer your money out of PayPal as soon as possible. The rules for PayPal accounts are NOT the same as they are for real bank accounts and there can occasionally be some nasty surprises when you find out in what ways they are not the same.
However, Elance offers a different solution for writers working for Elance and getting paid from clients that post projects there. It is called the Elance Pre-Paid MasterCard.
How Elance Pre-Paid MasterCard Works
The Elance MasterCard payment option works like this. First, you “apply” for the credit card. There is no reason to worry if you have bad credit to get this credit card, because it is a pre-paid credit card. That means that there is actually no “credit” associated with it at all. Instead, it is like one of those gift certificate type of gift card that you can use anywhere a credit card is used, or like one of the refillable Starbucks pre-paid card.
Instead of someone buying a $100 gift card and giving it to you, the Elance MasterCard starts with $0 on it and when you select to get paid from Elance via the pre-paid credit card, your earnings get deposited onto the card. For example, if you bid on a writing project on Elance and were awarded the project for $300, when the customer pays you for your work, the $300 does not go to your PayPal account, it gets deposited onto your MasterCard. At this point, your Elance card is like a regular credit card with a $300 limit, but instead of paying the money back after you spend it, it comes off of your balance.
Is The Elance Pre-Paid MasterCard A Good Idea?
All of this begs the question, is using the Elance MasterCard a good way to get paid. The answer depends on several factors. First and foremost is how you use your Elance earnings. If Elance is your main source of income, you will find it difficult to pay the mortgage with a MasterCard. You can make ATM withdrawals from the card, up to $1,000 per day. Although, you’ll have to drive around to a few ATMs to make that happen since most of them have a much lower daily cap for cash withdrawals. You will also be charged for each of those withdrawals unless you find a Surcharge Free ATM (several of them, actually). Plus, the card itself charges you $1.35 per ATM withdrawal. Getting your thousand bucks will cost you $5.40 plus whatever the ATMs charge you assuming the standard $300 cap at most automated teller machines.
Then, of course, you have to take that cash to the bank and deposit it into a real bank account so you can write a check or do an ACH transfer to your mortgage company.
In other words, the Elance MasterCard is not a good idea if you eventually need your money in cash form.
If you have other sources of online writing income, and those pay your “big” bills, then the whole pre-paid credit card thing might work better. You can pay your cell phone bill online with the card, for example, or use it for your trips to Staples. If you only use Elance for supplemental income, you can keep the card as your fun money.
Elance MasterCard Fees
The most important thing to keep in mind when using the Elance credit card option is the fees. There is a fee to get paid, because that is considered “loading” the card. You pay for each and every loading transaction, so if you get get paid on the card for 10 projects, you get charged 10 loading fees. These charges are modest (at time of writing), but can add up, so you should definitely be aware of them. The loading fee is $1.50 per transaction for “standard” and $4.00 for “immediate”. Standard comes with a 2 business day delay.
Also, the card charges a monthly usage fee of $1 if you actually use the card for at least 2 transactions that month, and $3 if you don’t.
There is also a $5 activation fee which is waived if you sign up during the introductory period. Also, don’t forget that there are no credit card rewards points to be earned or redeemed either.
When you look at all the details, I think the Elance Pre-Paid MasterCard is a good idea if you are going to use it to separate out some fun money or set aside dollars from some of the writing projects won for a certain purchase. However, for day to day usage and cash management for running a writing business, I think most people would be further ahead getting a PayPal Debit Card to provide the same functions without a new layer of potential expenses and fine print.
Good Writing, everyone.