Teaching young people how to successfully use a credit card takes a little research, and a lot of patience. Work with them to understand that a credit card is not free money, and how it can be a great tool to build strong credit. Since many adults have a credit card, invest the time in your teens to teach them how to be smart with one. Here are some tips for helping a young person learn how to use credit wisely, before and while having a credit card.
- Share your experiences
- Determine what age is right to get the card
- Talk about positive and negative outcomes
- Research together which credit card to get
- Start with a credit card with a low limit
- Develop a plan for the credit card
- Make the credit card your child’s responsibility
- Go over the first few bills together, with periodic check-ins later
Using these tips will help you to send your child out into the world with good credit, a healthy relationship with debt and an understanding of the importance of discipline.
Knowing how to handle your credit card correct could be rewarding in the long run. Learn about the Top 5 Myths About Credit Scores.