Giving credit cards to teenagers is a touchy subject. Some people feel that handing a credit card to a teenager is like giving them permission to go out on a very large spending spree, or advocating that they go into debt. The second benefit is that by making sure they use their cards correctly, you are raising their score a little while they are still at home. This will help them when they go to apply for student loans, a car, or an apartment. It will give them leg up when they are starting out.
10 Reasons to Avoid Credit Cards
Pros and Cons of Credit Cards for Teens Under 18 | Pocketsense
In the long-running sitcom Happy Days , Ralph, Potsie, and Richie had their hands full dealing with school, friends, and social activities. Throwing each of them a credit card would've put a whole new slant on those happy high school years. Credit card issuers are reaching out to teenagers and their parents with youth-friendly credit card products. Whether it's a prepaid card, or one associated with mom's account, these companies say that their products offer teens an early life lesson in financial management. While this may be true, there are also some pitfalls associated with handing a teenager a valuable piece of plastic. Ultimately, the responsibility falls on parents to ensure that the credit card is teaching their teen the right lessons about budgeting, spending discipline, and debt management. As long as parents set and enforce the rules, a small amount of credit leeway can help teens learn that credit card purchases represent money spent, just as cash purchases do.
Pros and Cons of Credit Cards for Teens Under 18
Credit cards get a lot of bad press for good reason: They come with a lot of pitfalls that need to be avoided. But while avoiding credit card debt seems easy on the surface, it can be quite difficult. Here are 10 reasons why credit cards can be detrimental to your financial health, and why you may want to avoid them:. Your credit score determines a lot more than what interest rate your mortgage will be.
Credit card debt is a major problem, and every year millions of people find themselves in over their heads. Interest rates rise, payments get missed, and credit scores are trashed. While credit card debt can be financially devastating, credit plays an important role in our lives.