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Articles for financial help
Credit Cards for Kids?
Does you kid need good credit scores now? A credit card company may provide a payment history for a spouse who is an authorized user on a credit card account. Paying off credit card debts on time can certainly be a factor to having good credit scores. But a credit card company is under no obligation to report payment habits when an authorized user isn't a spouse. So does your kid really need a credit card for establishing good credit?
Why keep good credit scores? Getting and keeping good credit scores can be beneficial when wanting to get loans with good interest rates. Before purchasing a home or getting other important loans, it is a great idea to know exactly what your credit scores are. If they are low you can begin to work on raising them for that all important loan you will be seeking.
Why would anyone want to give a kid a credit card? Could it be to start establishing a credit record as an authorized user on your credit card account? What purpose would giving a credit card to a kid age 16 or under? You decide, would it promote spending using a credit card and reap negative adult habits of using a credit card for spending? Can kids under age 16 be responsible in using a credit card. Kids are different, you decide about your kid.
Why give a kid a credit card at age 16 or some other age under 18? Giving a credit card to a kid who works hard around the home or outside the home to earn spending money could be used to teach life long budgeting skills and teach how to use a credit card wisely. There are many adults who are deep in debt because they whip out the plastic too quickly for things on a whim. Too many adults are knee deep in credit card debts because they use a credit card without considering a budget.
Why not give a kid a credit card as an authorized user on an adult's credit card account as a means to monitor and teach budgeting skills? This can take some time but could be a valuable learned lesson that can reap good benefits that carry over into adult hood. Teaching kids that credit cards that carry a balance must be paid and the balance should be paid off on time is indeed a great lesson. Teaching a kid not to over spend simply by having the ability to pull out a credit card and flop it on the counter without considering living within a budget is also a valuable lesson that may prevent getting caught up in credit card debt in adult hood.
So, you decide - do you give a kid a credit card and at what age do you give your kid a credit card? Every kid is different, but teaching life long skills of how to budget and live within a budget should be a lesson every adult tries to teach a kid. It is a lesson that can be taught with or without giving a kid a credit card. You decide how to teach a lesson whether it is using a piggybank, an allowance, or even a credit card. So get out there and teach your kids the lesson of budgeting!
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