teen credit card

Teenagers, not typically known for their conservative buying decisions, often rack up too much credit card debt. But some parents still prefer to give them credit cards because they believe their children should learn the value of managing their own finances responsibly. Others, however, are wary of giving credit cards to their children for fear they will rack up too much debt.

There are many banks that offer credit cards specially designed to meet the needs of high school and college students. Most of these cards are issued with the guarantee of a co-signer such as the parent or guardian. So while the co-signer has the ultimate responsibility for paying the card fees, students will also learn that they can use their credit cards to build a good financial foundation even if they don’t have a job.

If you are interested in giving credit cards to your child, make sure you have reviewed all of your options. There are banks that charge exorbitant fees, with the explanation that this is necessary because the applicant has no credit history.

Before you give your teens a credit card, you should understand the risks involved in doing so. Remember that you have no control over your child’s spending. Any reckless behavior by her son would undoubtedly lead to excessive debt, which she will have to pay since he is the co-signer. Your child’s credit limit should be as low as possible, so you can make sure your child uses it only for emergency purchases. It also encourages them to have a certain budget and work within it, and always pay in a timely manner.

If you are unsure about your child’s shopping habits, give your child an additional credit card issued by your credit card company. This is free and your credit card company will normally not charge you any fees for this add-on card. This way, your child will be less tempted to make unnecessary purchases and allows you to keep a close eye on her clothing spending.

You can also give your children a prepaid credit card if they are too young to have one. With this card, it will be easier for your children to use it, since when the balance of the card runs out, they will not be able to use it.