Teen credit an essential life lesson
We all know teen credit can be a risky proposition. But I am loving this common sense article from Motley Fool which suggests that responsible credit habits in college start in high school. Debit cards just don’t hold the same repercussions, the article states.
Indeed, late fees and interest payments are cold, cruel facts of life for the vast majority of Americans so why not let high schoolers get their hard knocks out of the way earlier rather than later. While Motley Fool’s advice may not be foolproof, it does make sense when coupled with parental supervision and discernment.
Only parents know if their teen is responsible enough to use a credit card. Were it my child, credit card privileges would mean monthly meetings with mom or dad to review credit card statements. It would also mean full payment of the bill each month or working chores around the house to compensate mom and dad if they had to pay it off one month.
Many teen credit card offers offer low credit limits and require a co-sign from a legal guardian. This means mom or dad’s credit record is on the line, which should motivate them to help supervise teen spending and repayment. It may be a hassle, but one well worth it in the end for the possible damage it may prevent on the teen’s credit report.
What do you think?
