Comments on: Should Teenagers Have Credit Cards?

By: liv

liv — Mon, 08 Dec 2008 23:16:01 +0000

I got one when I was 16 and I made all the mistakes I shouldn’t have made. Luckily, the limit was low, so I couldn’t do a ridiculous amount of damage. Seeing as how I like reading up on PF now, I’m glad I got the card now. I will probably give my future kids one, and make the limit lower than what I had.

By: DebtGoal

DebtGoal — Thu, 04 Dec 2008 02:02:14 +0000

This is an excellent discussion on the pros and cons of giving children access to credit. One element that was not mentioned is a discussion of how parents feel that credit should be used and how this might influence their teaching. If you believe that credit cards are primarily for purchasing convenience, you may wish to teach them how to manage the card so that they can pay the balance off each month. Some parents in this position have their children log expenses in their check register so that their kids perceive credit card expenses as drawing down their cash balances as purchases are made. Although it’s cumbersome, it does reinforce the fact that card charges are really spending from an actual balance that must be managed in order to be able to pay off the statement balance each month.

By: Funny about Money

Funny about Money — Mon, 01 Dec 2008 23:56:20 +0000

“There probably is no replacement for actually handing a child a credit card, letting them get into trouble with it, and then making them work to pay back what they borrowed.”

LOL! That’s right up there with throwing the kid into water over his head and letting him sink or swim. I nearly drowned when my father did that.

Seriously, if you haven’t already taught the kid some responsibility, you ought not to hand her or him a credit card and invite humiliation and grief. What’s the point, other than gratifying one’s meanness?

By: Matt @ SF

Matt @ SF — Sat, 29 Nov 2008 00:17:19 +0000

I got a checking account and a checkbook for Christmas just prior to turning 16. It taught me basic personal finance skills as well as the importance of saving.

So yes, I would agree CCs are good for teenagers as long as they have some parental oversight and realize swiping that CC means the same as handing over real cash.

By: Patrice Peyret

Patrice Peyret — Fri, 28 Nov 2008 17:49:31 +0000

Admittedly as self-serving comment since we run a number of prepaid card programs on behalf of MetaBank under the UPside Visa brand:

Credit Cards also have the major drawback of not helping teens with the concept of saving for later gratification: while a teen could choose to not spend the money on a prepaid card until more money is loaded onto it (waiting for next month’s allowance or the next direct deposit from a part time job) in order to buy a bigger ticket item later, none of this process is available with a credit card. This is a fundamental building block of financial responsibility.