They aren’t just for adults anymore. Turns out, more children now have credit cards. In some cases, we’re talking about kids in their early teens. So, is this something you would be comfortable with?
We are stretching your dollar with why more parents are getting their kids signed up with credit cards at a younger age.
How much credit do you give your child? Apparently a lot.
A study by creditcards.com finds 8 percent of parents with kids under 18 say at least one child has a credit card.
That’s a good thing. Experts say to give kids a head start building their credit and learning how to manage their finances.
You can set a small credit limit for them and alerts when they go over. They can learn about late fees, interest charges and identity theft at a young age, before they go off on their own and have to find out the hard way.
There is however, a downside. Experts say they can make unauthorized purchases and ruin their parent’s credit if you’re not careful.
It’s important to keep a closer eye on transactions to not only protect yourself, but find those teachable moments if they’re overspending.
Here’s something to consider – you don’t have to give kids a physical card. You can just add them to your account to start building their credit. If you do give them their own card, you can set limits and in some cases freeze it when you need to.