There comes a stage in every parent’s life when they have to consider the consequences of their teenager having access to their own credit card. For the teenager, it can be an exciting time –- they feel grown up, able to make their own financial decisions, and they have money in their pocket, possibly for the first time.
But this is where proper care should be taken from the point of view of the parents. If they decide to allow their child to have a credit card, proper consideration must be undertaken beforehand. Is their child really ready for such a responsibility? It is a very important decision to make and if the teen is not ready, they could end up with debt problems they won’t be able to shake off for a long time to come.
A Teen’s First Credit Card: Tips For The New Card User
Let’s address a few questions before introducing that new credit card.
1. How responsible is the teenager?
This is the #1 question. If they are not responsible in other areas of their lives, they will not suddenly become responsible when given a credit card. In this situation, it would be best for the parents to refrain from allowing them to get a credit card at all.
A lot may depend on the age of the teenager but if they aren’t able to handle money, the sudden appearance of a credit card won’t help matters at all. Instead, it will lead to all kinds of problems.
2. Do they really need a credit card?
Credit cards are very much a way of life for many people that it can be very easy to forget that having one is a choice or an option. Just because a teenager reaches a certain age, it doesn’t mean that they should automatically become entitled to a line of credit.
If they are doing well without a card, then there should be no real reason for that situation to suddenly change.
3. Consider the types of credit cards that are available.
While you may want to compare credit cards to find out which could best fit your child’s needs, your decision could actually be simpler than you think. If the decision has been made for the teenager to get a credit card, then a prepaid one like the Mango MasterCard Prepaid Debit Card could be the best option to go for. This is particularly the case if the teenager could be a prime candidate for getting into trouble with a standard credit card.
You’ll need to load a balance onto the prepaid debit card in order to use it. When that balance is exhausted, the card cannot be used again until more money is added to the account. With this set up, your teen can get used to the idea of using plastic to pay for things, without running up huge debts in the process.
If you’re more interested in student friendly cards, you may also want to consider these best student credit cards. They reward card holders for good behavior and unlike prepaid cards, will help build credit. The downside? With these cards, you can accumulate debt.
4. Does the teen understand the consequences of owning a card?
The bottom line is this: credit cards can lead to debt. It is therefore wise for parents to sit down with their kids to explain the responsibility that comes along with being a card holder.
I would forget about getting anyone a credit card until they’ve demonstrated financial responsibility. This is the best way to avoid the possibility of building up a huge amount of debt in a very short time.
Some teenagers are certainly worthy of using credit cards and they will handle the responsibility well. But for many others, the temptation to spend, spend, spend is just too much. This is why proper consideration must be given to the potential for misuse –- before anyone applies for that credit card.