Jan Faull, MEd, on when parents should allow their children to open a line of credit.

Q. Is 15 too young for my child to have a credit card?

A. Teaching kids about finances is an important part of being a parent. They need to learn about savings accounts, credit and debit cards, stocks and bonds, insurance, and interest rates. Yet to hand your teenager a credit card without any instruction about how to use it responsibly would be irresponsible parenting.

Kids today receive in the mail all kinds of offers for credit cards. Yet most of these kids have no income. Credit card companies prey on their immaturity coupled with some parents' unwillingness to say "no" and mean it.

Consider these scenarios when you're considering allowing a credit card:

  • Does he have a job?
  • How will he pay it off?
  • Will you be paying the balance every month?
  • Does he understand about the interest he'll be charged if he doesn't pay it off every month?

Use Plastic Safely

The last thing you want him to do is to get into trouble with credit card debt, so it's probably better to get him a debit card. If you give him an allowance or if he has a job, he can put the cash in the bank and use his debit card to make purchases without paying any interest. He can learn to check his balance and even learn to do some budgeting.

If he really wants a credit card, talk with him about his spending limits, and what he would end up paying in interest if he doesn't pay off the bill every month. Since he's less than 18 years old, you'll be responsible if his credit card adventure goes awry.

Lessons and Dangers

A credit card could be a good financial teaching tool, particularly if you've been a good financial role model. He can learn the importance of establishing good credit. On the other hand, a bad situation could unfold if he sees how easy it is to acquire one, uses it to his financial limit, pays the minimum amount each month, and then applies for another one.

Proceed with caution. The parenting bottom line revolves around your son's level of maturity, how you'll handle any misuse of the card, and what your son learns from the consequences of his actions. He could become more responsible or less from an early credit card fiasco.

An important point to keep in mind is that today a credit or debit card symbolizes a rite of passage in our culture. Along with a driver's license, it's a sign of being grown up among the teen set. To deny him might cause rebellion in another area. Your safest bet for now would be to allow a debit card. With it he's using plastic but it's guarded with each purchase: he can't overspend or overdraw his bank account.

Jan Faull, MEd, is a veteran parent educator and the author of two parenting books, Mommy, I Have to Go Potty and Unplugging Power Struggles. She writes a biweekly parenting advice column for HealthyKids.com, and a weekly parenting advice column in the Seattle Times. Jan Faull is the mother of three grown children and lives in the Seattle area.

Originally published on HealthyKids.com, August 2005.

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