A Few Good Reasons to Get Your Kid a Credit Card
Why in God’s name would you give your kid a credit card? They’re a bad idea. The kid could run up major debt at Target and then forget to pay on the card. Then that ruins their credit score, the one they know nothing about.
All of this is true.
But they could also learn how to use a credit card responsibly, learn to pay bills, build credit, and learn how credit scores work. All of this while still living with you and getting guidance from you.
During my youth — ages ago — credit cards weren’t common and if you were working class, they were definitely viewed as something from the devil. People were so worried about getting trapped in debt. So, scaring the hell out of your kids about credit and just letting them figure it out on their own was often the route our parents took.
I remember graduating from college and having all these credit card offers showing up in the mail. I didn’t even have a job. Sending these to new graduates should be illegal. But I got a few and I managed them for a while. Then I got in over my head. I paid them off, but it hurt. Lessons learned in the trenches.
Now that I’m helping my 19-year-old son and his three friends meet their savings goals to move away and pursue their interests, I find myself sitting down with them to explain credit, a FICO score and all that good stuff. I hear my mother’s voice warning me, but she doesn’t know. They actually need them.
It might interest you to know that some of the wealthy more money savvy parents got their kids credit cards as a childhood birthday present. Those kids will roll out into the world with a higher credit score just because they’ve had a credit card in their name since they were a year old. Talk about gaming a system. But good for them. Wished I had thought to do that for my kid.
Instead of having a mother who knew that little trick, my son and his friends sat in my living room and each applied for a credit card. They’re using the cards to gas up their vehicles, and then they’re paying them off. It’s not fancy but it’s a way for them to establish credit. Because when they leave my house in September, they’ll have to get apartments and credit checks will be done. I’m not keen on cosigning for all these kids, so they’re going to have to build up some credit.
Credit cards are a normal part of life for most individuals. Why not help your kid out and teach them about them?
Credit is something young people don’t really know about, but it’s something they’ll need down the road whether it’s buying a house or renting an apartment. With your help they can learn the best way to manage credit and have it be helpful to them. Show them the responsible way to use credit.
Be who you needed when you were young.
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