Should I get my Teen a credit card?

We’ve made some inroads in my house recently. With her first part-time job under her belt, my daughter has really nailed down (like fully embraced) the whole concept of earning her own money to buy her own things.

It’s funny when that connection is really made- it’s like shopping alarm bells go off. Which sort of makes me think of a conversation I had with a neighbour a few weeks ago who was considering getting her teen a credit card . It certainly would be relevant to “ride the wave” of these new found money lessons, but there are a few things to consider before getting your teen a card (either their own or as an auxiliary card from your account)

Baby steps

Your teen won’t like this particular reference, but baby steps are a good idea when taking this major step towards understanding responsible credit usage. Make it clear that this is a learning tool, not a spending-free-for-all to fuel impulse purchases.

You are far better off to develop the right attitude towards credit usage from day one.

Does your teen have a chequing account? If not, you may want to open one for them and practice balancing this budget first.

Skills to pay the bills

What is this card going to be used for? Do they have the money (from a job, chores around the house or accumulated savings) to pay the balance in full every month.

The last thing your teen wants is to be saddled with debt (however small) that is accumulating interest.

Don’t abandon savings

Even though credit technically provides them with an avenue to have what item they seek instantly, don’t leave the savings habit out. Still save up for purchases, rather than buy now, pay later.

Secrets you can keep

Make sure your teen is responsible enough to keep their PIN and other important personal financial information hidden. This is another very important practice to instill, right from the get-go.