Credit card for teen
- Thread starter bjscheel
- Start date
Marionnette
Children see magic because they look for it
- Joined
- Sep 26, 2009
Have her look into a credit card thru her bank or credit union. They tend to be less strict about starting young people out with small lines of credit when the kid has an account with them.
You can also add her as an authorized user to one of your accounts if you're more interested in providing her with the convenience of having a CC rather than establishing credit in her own name.
Cadiewampus
DIS Veteran
- Joined
- Nov 14, 2008
We went to our credit union and got my son a card. He didn't have credit at they time so they gave him one with a low limit with me as a cosigner on it
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
The laws have changed, at least in the U.S., since I was 18.
Currently the law in the U.S.-Consumers under the age of 21 must prove that they have an independent income or get a co-signer before applying for a credit card-the law which this rule is part of went into effect in Feb 2010.
When I was 18 I got my credit card through a local bank without needing any permission from my parent. The type of credit card I got was very friendly to students who by nature will not have credit history and the representative who processed all the paperwork said just about everyone got approved.
I will tell you, personally speaking, if you can get your child a credit card at age 18 it will help them in the future. Some of my friends weren't allowed to get a credit card as their parents feared they wouldn't manage it well.. and unfortunately those friends are now having issues because they have a lot less credit history than me.
My sister-in-law in fact is one of them. Despite making a very good salary she was denied twice from a car loan because she lacked enough credit history and ended up needing her parents to co-sign on the loan. She only in the last 2 years (she just turned 25) got a credit card.
Currently the law in the U.S.-Consumers under the age of 21 must prove that they have an independent income or get a co-signer before applying for a credit card-the law which this rule is part of went into effect in Feb 2010.
When I was 18 I got my credit card through a local bank without needing any permission from my parent. The type of credit card I got was very friendly to students who by nature will not have credit history and the representative who processed all the paperwork said just about everyone got approved.
I will tell you, personally speaking, if you can get your child a credit card at age 18 it will help them in the future. Some of my friends weren't allowed to get a credit card as their parents feared they wouldn't manage it well.. and unfortunately those friends are now having issues because they have a lot less credit history than me.
My sister-in-law in fact is one of them. Despite making a very good salary she was denied twice from a car loan because she lacked enough credit history and ended up needing her parents to co-sign on the loan. She only in the last 2 years (she just turned 25) got a credit card.
Last edited:
tvguy
Question anything the facts don't support.
- Joined
- Dec 15, 2003
Interesting. New one on me. My youngest got her credit card at age 18 through Wells Fargo without a co-signer or ANY income. She was going to school in England for a year. That was in 2013, so somehow she avoided that law. Now, our credit union wouldn't allow her to even open a saving account because THEY said she had to have 2 proofs of residence, and only ONE could be a government issued ID. Only proof she had was a driver's license and a passport. They wanted pay check stubs, rental agreements, utility bills, all things an unemployed college student who has been living at home will not have. Also why they are no longer our credit union. Wells Fargo had no such requirement, nor did the credit union my mom used.
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
Don't know what to tell you regarding your daughter's situation. It's under the Credit CARD act of 2009 where I got my information from.
tvguy
Question anything the facts don't support.
- Joined
- Dec 15, 2003
Like I posted, there was a lot of confusion on the part of the Credit Union that turned her down. THEY said Homeland Security required the additional ID, but Wells Fargo and the other credit union said they knew of no such requirement.
disfanforlife
DIS Veteran
- Joined
- Nov 9, 2006
My daughter got a Discover Card that was targeted at students when she was 18. Granted the credit limit was only $1,000 - it was still a great way to get started.
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
True there is/was a lot of confusion surrounding it.
Marionnette
Children see magic because they look for it
- Joined
- Sep 26, 2009
What other income would you include? Do she have annuities or a trust fund from which she draws income?
If it's her credit card, then only her income - whatever that income may be - should be considered in the application.
davper
DIS Veteran
- Joined
- Mar 5, 2015
If the purpose is to build good credit, skip the credit card. Let's not teach them that consumer debt is the norm.
Go to the bank and open a savings account, get a 12 month CD for $1000, Use that CD for a secured personal loan. Make 12 months of payments and repeat. By the time your child is ready to buy a home or car, they will have A+ credit to get best rates.
Go to the bank and open a savings account, get a 12 month CD for $1000, Use that CD for a secured personal loan. Make 12 months of payments and repeat. By the time your child is ready to buy a home or car, they will have A+ credit to get best rates.
SC Minnie
I'm no quitter - Are we there yet?
- Joined
- May 18, 2001
DD got a CC right after she turned 18 in July before she headed to college her freshman year. It was through our credit union where she's had an account since she was an infant. The CC limit was only $250 and she still had her part time job at CFA when she applied for it. DH and I figured the $250 limit was enough for her to get gas or buy anything she may need while at school but not enough to go crazy.
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
1) Having a credit card does not equate to teaching someone that consumer debt is the norm. It is unfortunately the way our society works in that credit in general (having a good score and history) drives much of the decisions entities make regarding a person. ETA: having a credit card is only one of many ways to build good credit history but it def. is a big one.
2) You have completely oversimplified the situation. The scenario you described regarding a CD would not guarantee the best rates and an A+ credit for a car or home loan...have you actually bought a home recently? When we went to get a mortgage for our home in early 2014, granted we were having our house built instead of buying a home already built but still process was the same, we had to give paystubs for each month during the 7 month building process, were under strict guidelines to watch our credit like a hawk aka do not in any way buy something like furniture, we had to provide bank statements, 401k statements and have our credit report run for both of us.
We both have excellent credit and had good income so we got the best rate available at that time.
Here's just a few items that the credit bureaus looked at on our credit reports:
~Pay bills on time
~How much you owe creditors
~Time since most recent account was opened
~Length of time revolving accounts have been established
~Length of time accounts have been established
~Length of credit history
~Length of revolving credit history
~Loan balances to loan amounts
~Amount owed on accounts
If the purpose is to build good credit it might not be a bad idea for the OP to seek professional assistance.
QueenIsabella
DIS Veteran
- Joined
- Jan 17, 2016
I just took DD(now)21 down to our local bank and set her up. She was going away to college, I wanted her to have a card with a smallish limit ($3-5k, YMMV). I'm a co-signer on her card, although I never use it. The bills come here, and generally I pay them.
In addition, she hadn't had a debit card up until that point, so they set her up with a checking account (she's written maybe 3 checks in the past three years). Usually, it auto-transfers from her savings into checking. She uses her debit card almost exclusively, and tracks her withdrawals on an app.
DD is now a senior in college. We haven't had a single issue with her abusing the credit card. Any bills that come to me are things we've agreed on--her books, for example. Right now she's out of the country, so she disconnected her savings and checking accounts for safety (if she loses her debit card, they can only get so much).
While I appreciate the lecture on using a CD to build credit
, there are important and valuable reasons to have/use credit cards. To use an example, my DD21 left here on 8/20 to fly abroad--she was flying out of JFK the next morning. At 6am I got a frantic text--she had left her passport on our printer! For a mere $111, I shipped it, American Airlines cargo, so she received it ~4:30pm. Obviously, she missed her flight, so for another itsy-bitsy $340 fee, she changed to a flight the following day. She also had to spend an extra night in a hotel--no way was I having my child (and her luggage!) spend a night in JFK. THIS is the reason I wanted her to have a credit card. You never know when an emergency--a true emergency--is going to come up.
On a slightly less dramatic note, my DD does occasionally charge Uber rides to her credit card. DH and I choose to pay these--she goes to school in a big city, we'd rather she be safe, and not think she's going to get a Mom and Dad lecture because she chose not to walk home one night.
In addition, she hadn't had a debit card up until that point, so they set her up with a checking account (she's written maybe 3 checks in the past three years). Usually, it auto-transfers from her savings into checking. She uses her debit card almost exclusively, and tracks her withdrawals on an app.
DD is now a senior in college. We haven't had a single issue with her abusing the credit card. Any bills that come to me are things we've agreed on--her books, for example. Right now she's out of the country, so she disconnected her savings and checking accounts for safety (if she loses her debit card, they can only get so much).
While I appreciate the lecture on using a CD to build credit
, there are important and valuable reasons to have/use credit cards. To use an example, my DD21 left here on 8/20 to fly abroad--she was flying out of JFK the next morning. At 6am I got a frantic text--she had left her passport on our printer! For a mere $111, I shipped it, American Airlines cargo, so she received it ~4:30pm. Obviously, she missed her flight, so for another itsy-bitsy $340 fee, she changed to a flight the following day. She also had to spend an extra night in a hotel--no way was I having my child (and her luggage!) spend a night in JFK. THIS is the reason I wanted her to have a credit card. You never know when an emergency--a true emergency--is going to come up.On a slightly less dramatic note, my DD does occasionally charge Uber rides to her credit card. DH and I choose to pay these--she goes to school in a big city, we'd rather she be safe, and not think she's going to get a Mom and Dad lecture because she chose not to walk home one night.
My son got a CC in his name with no cosigner the summer after he was turned 18, just a bit before he went to college. Waited until he had worked 6 weeks or so at his summer job and used that income for the CC. Got a student CC from the bank we all use, he has a student checking and savings account there. The bank knew the income was just a summer job but was ok with it (maybe because we bank there and have several accounts?). He says he pays it off in full each month, and I'm guessing that's true as he's had 2 credit limit increases since opening it, not at his request. First semester of school was tough for me, I wanted to check and make sure he was paying the CC on time but since i'm not on the account I have no visibility of it (as it should be) lol! He has had one of our cards with his name on it since he got his driver's license and has never abused it. These days he uses it for the few school expenses we pay like books, and it came in handy when he went to the ER and had to do a good sized co-pay.
One thing I consistently hear is NOT to co-sign a CC for a young adult.
One thing I consistently hear is NOT to co-sign a CC for a young adult.
KarenAylwood
<font color=red>It wouldn't be the holidays withou
- Joined
- Apr 5, 2005
When I was 16 my mom opened a card that we were both on, that was meant to be mine. She charged on it to start, and then about a year later I was the only one who charged on it. When I turned 18 she transferred it only to my name. At 34 I still *only* have 18 years of good credit. My report says that "good" is 8-25 years and 25+ is excellent. That's the only category I'm not rated excellent in. I am so glad that my parents pushed the idea of good credit and taught me from a young age to pay off my entire balance each month and absolutely not to be late. I have a score of over 800 and have never once carried a balance. I credit my parents, and especially my mom with my attitude towards finances, savings, and credit. I had many friends that started getting credit card offers in the mail at college when they were 18 and started on CC spending and debt very early.
My first card was Capital One and I still have it and use it often. I think it's great that you want to get your daughter started on building credit. It's important though to understand the type of child you have. I have a card that's mainly in my mom's name that I use if I'm out and she wants me to buy something for her, or for my DS (mom lives 500 miles away now). I would never charge on it without asking her first but my parents have friends who's daughter has a card of theirs and is my age and she randomly spends on it all the time. I would never dream of doing that.
You can also just get a card in your child's name or with your child's name on it and not physically give them the card. That will help build credit as well as long as someone is charging on it and paying it (you). Again, Capital One is a good choice. I was happy to have it later in life when I went abroad because it's one of the few that won't charge you fees.
My first card was Capital One and I still have it and use it often. I think it's great that you want to get your daughter started on building credit. It's important though to understand the type of child you have. I have a card that's mainly in my mom's name that I use if I'm out and she wants me to buy something for her, or for my DS (mom lives 500 miles away now). I would never charge on it without asking her first but my parents have friends who's daughter has a card of theirs and is my age and she randomly spends on it all the time. I would never dream of doing that.
You can also just get a card in your child's name or with your child's name on it and not physically give them the card. That will help build credit as well as long as someone is charging on it and paying it (you). Again, Capital One is a good choice. I was happy to have it later in life when I went abroad because it's one of the few that won't charge you fees.
MinnieForMe
DIS Veteran
- Joined
- May 15, 2007
Discover! My son received his about 6 months ago without a cosigner or income. The only thing they requested was a copy of his college acceptance letter.
He did start working shortly after receiving it to pay in full every month his purchases.
He did start working shortly after receiving it to pay in full every month his purchases.
Mackenzie Click-Mickelson
Chugging along the path of life
- Joined
- Oct 23, 2015
Yeah I should preface my earlier statement with the fact that according to our mortgage broker we had the best rate they had at that time. The very beginning of the process where our credit was first run I had 7 1/2 years of credit so yes my credit report did say in not so many words you don't have a whole lot of credit history but it still in the end didn't make it so we had a worse rate because of lack of a gadzillion years of credit history our other parts that went into a credit report made up for it. I was 18 with my first credit card and was 25 1/2 when we started our home building process. At this time I've got 10 years of credit history while some of my friends have 2 or 3 years and they are the same age as me (which is 28).
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