Credit Cards for Teens; Should You Purchase One?
Millions of adults are plagued with credit card debt from which
many never recover. Credit card debt is an increasing problem
among worldwide, and one may question the wisdom of credit cards
for teens. Are credit cards a good idea for teenagers? Like many
of life's risks, credit cards for teens have their advantages
and disadvantages.
Credit cards for teens work in a different way that traditional
adult credit cards. Teenage credit cards do not loan out credit.
To use these cards, one actually needs to have money already in
the account. A teenage credit card is often a convenient way for
parents to give their children money without having to hand over
cash or a check. Credit cards for teens make a great gift,
because they can be reloaded or thrown away when the balance is
at zero.
Many parents choose to give their teenager a credit card because
it increases their sense of responsibility and because it helps
to educate them about handling money. Issuing Credit cards for
teens is a safe and convenient way for kids to learn about
credit cards, budgeting, and general finances. Learning proper
money management is a big advantage for a teenager and will be
useful in the future.
Teenage credit cards are generally limited and monitored.
Depending on the credit card company, parents and other adults
who purchase the card can monitor the spending habits of the
cardholder. This is convenient when trying to determine how a
teenager is handling their money or what they are spending it
on. Once the money is placed on a teenage credit card, the card
acts and functions as if it were a traditional adult card.
Online shopping has grown in popularity among individuals of all
ages. A teenager could pay for an adult or unapproved item
without their parents even knowing about it; therefore, a credit
history report is important and often requested.
Although credit cards for teens are convenient for both parents
and children, many teenagers may become dependent on the
convenience. Carrying around a credit card instead of cash or a
checkbook is easier, however, it comes with price. Although many
banks charge a fee for credit or debit cards, the fee is
generally drastically lower than the ones attached with a credit
card. Teenagers or young adults who become accustomed to paying
with plastic often put themselves at risk of serious credit
problems when they obtain a traditional credit card. Because
they are used to just whipping out the plastic charge card, they
may be more likely to do so in college or later on in life.
Credit cards for teens can be an asset or a liablity. They may
teach kids the importance of tracking money and not spending
beyond their means. However, there are other teenagers who may
handle the situation differently. The decision to offer your
child a credit card is one that the whole family should decide
carefully. Giving credit cards for teens to a try for a while
just might work out in your benefit. If it doesn't work out,
just throw away the card when the balance has been depleted and
revert back to traditional cash. There are numerous ways to
educate your child about money, including giving your child a
teenage credit card.
About the author:
Matt Garrett
http://www.0Interest.org http://www.credit-ca
rds-for-teens.com
