<p>D couldn’t get a card through her bank last summer because she had no credit history and no full time job–then she got two unsolicited student credit card offers (from different banks) in the fall. (I’m guessing perhaps the college sells a list of those who are paying their tuition bills on time. Or maybe the pending new law has pushed the credit companies to sign up people before it goes into effect.) She accepted one from BofA. Small credit line, but it’s a start, and very useful for travel expenditures and emergencies. D understands that the card is to be used only for specific types of expenses and so far is entirely compliant. It’s never too soon to start establishing a credit record.</p>
<p>My son also got his through USAA, he has a checking account there already. He’s been well paid the last two summers, so he actually does have income, but the credit card they offer is set up so that the credit line is upped each year. It was $500 for freshman. Like us, he pays in full every month. I have no problem with credit cards as long as your kids understand that paying in full is the only way to go.</p>
<p>A number of our cards have recently sent us either higher interest rates (who cares we pay off in full each month) or lower credit limits (who cares they were way higher than we ever charged.)</p>
<p>Another vote for USAA</p>
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It will always be around. There will always be people needing credit and willing to pay up for it. Credit has existed for thousands of years.</p>
<p>Both my kids have been able to get along without using credit cards, they just use their debit cards. The only credit cards they’ve used are their employers’ cards while they travel for work.</p>
<p>I know they’ve built up credit along the way, because they’ve rented a few apartments that have checked their credit rating. Actually, one landlord rejected another applicant because my D had higher credit scores. So yes, you can establish credit through on time payments of utilities.</p>
<p>I know one of my credit unions offers it’s low interest rate card to students with a guaranteed credit limit of $500 or more. If a parent has good credit and trusts their student, they can cosign a card. I use the latter as a debit card, paying it off each month and collecting the cash back. A debit card is great for places that don’t accept credit or your type of credit card. At many fast food type places, a debit card is processed as credit anyway, so one might as well pay with a credit card. </p>
<p>I was taught to use credit wisely and have as good a FICO as possible. Then a person can choose among several competing offers. If the parent is unwilling to cosign, then have the student open cards and build credit ASAP before the laws change. Even though I don’t qualify, I have heard nothing but great things about USAA.</p>
<p>My own kids only use debit cards, so I don’t have a horse in this race. </p>
<p>But for families who do, I’m passing on a recent conversation with a friend who worked in the credit industry. </p>
<p>She said that the mere “having” a credit card won’t help; it’s the using of it that establishes a credit rating. She says the way to do it is have a young person take out their first credit card, be sure to buy “something” necessary with it monthly even for just $l0 (e.g. a grocery store purchase, or gasoline). Then pay the credit card bill promptly each month. Set it up as an automatic payment, or with email reminders, anything… so it’s not forgotten. This history will impress when it comes time to calculate someone’s credit rating. </p>
<p>Idle credit cards don’t create a positive credit record. They want to see a long history of regular, timely payments, regardless of amount spent.</p>
<p>We all know the dangers of overusing credit cards, so her approach seemed intelligent to me.</p>
<p>^^^ That’s what we told our daughter to do when she got her card. Use it every a little every month and pay it off every month. </p>
<p>Both my kids have excellent credit ratings. When my daughter moved into an off campus apartment she did not have to pay a deposit on the utilities put in her name because she already had a good established credit rating. Her room mate did have to pay a deposit on the utilities put in her name - not because of bad credit but because of lack of any. So it is always good to start establishing a good credit score early rather than late.</p>
<p>For each of my kids, I have a joint CC with each of them. I charge on it & when they need to, they charge on it. I have all bills sent to me & they need to confirm that the charges are correct & were incurred by them. Both have been prudent in their use of it. I feel much better knowing they have it to handle an unforeseen purchase of an airline ticket, road emergency, or who knows what.</p>
<p>We do that also - both out kids have cards of ours in their names. They are for using for emergencies and for things that we will pay for, for instance doctor visits, medicines, school books. They have both been very good about using it only for such things and letting us know either before or soon after. Before he had his own card my son did ask to use it a couple of times to pay for things like concert tickets that he had to have a card to buy and sent us a check for the money. As I say they are both very good with it. At the time we heard they could start their own credit rating by having signature power on our card, then we thought that changed, then we heard it had not. Now I just don’t know! My son’s bank did tell him that even though it showed on his credit score it was ‘falsecredit’ or something like that.</p>
<p>Now I do have a friend whose daughter was dreadful with her dad’s credit card and debit card, running up humongous bills. Dad apparently didn’t own a pair of sharp scissors. I have another friend whose daughter refuses to have a credit card because she does not trust herself. So there is not a one size fits all here.</p>
<p>the exact same experience (and ages) as ebeee. Also went back to the bank (since I know banking), but to no avail.</p>
<p>USAA federal savings bank still offers college kids a starter credit card.</p>
<p>I’m surprised no one has mentioned secured credit cards. D’s request for a student credit card was rejected this past summer from BoA for no credit history. So it was suggested she start with a secured credit card. She has $500 on hold and is building credit history by using the card to pay one bill a month. There is a one-time fee involved but our local branch got rid of it for us. The bank said that after a year with that credit card, she could probably switch to the non-secured type.</p>
<p>I hate credit and debt, but living abroad and not having any credit history in the U.S. has made me realize the benefits of having one.</p>
<p>My D, with no income, received two credit card offers this week. One was from Discover and one from Capital One. I didn’t read any of the information as they went into the trash, but I’m assuming these are common offers as I also received them. I had probably signed up for some college search related website when we were in the midst of her search.</p>
<p>This is a good question. Banks are very tight right now and my son signed up for a student account that ostensibly came with a credit card (at B of A) and then they rejected him for the card. You have to make sure it is in the kid’s name to establish credit history and not yours (though you can be a cosigner) and the kid has to a) use it; and b) repay it. I effectively do my banking personally and for my company at a big brokerage firm and they rejected my son’s application (duh, doesn’t have credit history) and I told the broker (he may be called wealth manager or financial adviser, the flavor of the week changes) that a big part of the reason I kept money there was for convenience (and not his sage investment advice) and they must have solved this problem before, and lo and behold, he found a way to solve the problem with a card at a low credit limit (fine with me). It will be set up online so that I can monitor it as well to make sure that it is getting paid in full at the end of the month so he builds a good FICO score.</p>
<p>I am also forced to use my firm’s banking service, and I am one of their premiere customers, so I requested to have all of my kids’ accts to have the same status as me. D1 gets all kind of offerings because of her status, but her acct isn’t that big. But no credit card until she has a job.</p>
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<p>Do these offers uniformly end up with a credit card if you reply to them or are they like college advertising that the kids get in the mail–apply to XYZ College (but the truth is, we’ll more likely than not reject you)?</p>
<p>We drilled into D2 the importance of paying off her credit card monthly, but we must have overdone it–she pays off her credit card as soon as she uses it! She’ll charge something in the afternoon and then transfers money over that night to pay it off. I’ll try to get her to relax a little.</p>
<p>But definitely agree with P3T that the credit card needs to be used monthly so that the fact that the bill is being paid in a timely manner is noted for a credit history to be built.</p>
<p>So far, the only person who has paid ANY overdraft or other fees in our family is my S–he was confused about the amount in his account & paid two overdraft fees to BofA & was furious. Plans to close the account in the near future but since then has NEVER had any problems. All in all, I think it was a pretty cheap lesson to check his balance & be sure he was using the CORRECT debit card (he has two).</p>
<p>D & her friends have figured out that when one of them doesn’t have needed cash but has a credit card, they can all go out to a meal, everyone can pay cash to the person who has none & that person can charge the meal. It works out for them and seems a sensible way to avoid cash advance charges.</p>
<p>BOA-</p>
<p>Son has a credit card in his name alone. We did not co-sign for it.
Uses for emergencies only.
Applied as he has his student checking acct there. His savings acct is at a different bank so the money at BOA is not more than $500 at most at any given time. Earnings- he put $0 on the app. as he doesn’t have a job at school. </p>
<p>He was given the credit card with a higher limit than we had applied for. Still not high, but it was $7-800 or so instead of the usual $600 limit. He had it for study abroad just in case he needed it.</p>
<p>USAA is best and they just last month opened up membership to ANY military retiree, so if Grandpa was in WWII, get him to join and all his line can join, too.</p>
<p>I am not a big supporter of kids with credit cards, but my girls have all had them and need them for online purchases (books) and travel arrangements, as a matter of fact they have all upped their limits to handle airline tickets. I tell them to begin the CC by paying off each purchase online the same week they make it, to get in the habit mentally of feeling the money spent.</p>
<p>crazed, when did your child get that CC? What I have seen is that in the past three years the situation has changed drastically.</p>