<p>Surely your kids have received many offers from Visa and MasterCard, etc for various Credit Cards. I am not a parent... and so I was wondering what you guys thought of getting one or two of these credit cards..... I never have used a credit card unless I know I have the money at hand [such as when I buy things online].....</p>
<p>I'm mainly wondering what to look for... what should I be careful of [anything in the fine print or not even mentioned I should be aware of?]</p>
<p>You should definitely read the fine print regarding fees interest rates, is it an introductory rate that then goes up after 6 months. My suggestion is as a college student you can get a credit card through the bank where you bank and discard the mailings.</p>
<p>Do not get a credit card that requires you to pay an annual fee.</p>
<p>Pay your balance in full each month. Interest charges will eat up most of your payment and it will take forever to get back to zero.</p>
<p>Consider a MC or Visa debit card tied to your bank account. It will only allow you to spend what you have, but will still give you convenience for on line purchases.</p>
<p>One that came in the mail was from 1stFinancialBank.. [Visa] .. from what I can tell.. the only way you can really get into trouble is with above 200$ expenses...
[It states no annual fees, set up fees.. and that APR will go up if you spend over 250$...].</p>
<p>The other is from CHASE... I'm not feeling too good about this one.. esp. with the whole changing policies after 6 months.</p>
<p>My dd is a senior in high school and has been getting numerous pre-approved credit card applications in the mail. We shred them all. Hopefully, she has listened to us when we have talked about credit card use, especially during college years. It's too easy to buy a bunch of stuff you can't afford. Hubby and I do use some credit cards, but we pay them all off within the month in order to avoid finance charges.</p>
<p>I would encourage you to get one. I read a thread by a parent recently on CC whose daughter didn't bother with all the offers as a senior in high school/freshman in college because she didn't need one. Then when she graduated, she couldn't get a credit card because she didn't have a credit history. </p>
<p>That was an eye opener for us. Our son has used a debit card since he was a sophomore in high school. However, he just switched to a no fee credit card as a senior in high school so he won't face a similar problem. </p>
<p>It goes without saying that you should pay it off in full every month. As long as you do that, the no annual fee is more important than the APR, in my view. Between multiple no annual fee cards, however, look for the lowest annual percentage rate.</p>
<p>Also check to ssee what the policy is reagarding charges over your limit. The limit will probably start out pretty low, maybe $200-400. It's easy to spend more than than buying textbooks! But if you go over your limit, the charge can go through, but there may be a hefty penalty tacked onto the bill -- even though you always pay in full and on time.</p>
<p>Also, it's nice if the charge card is with a bank that has a branch convenient for you to drop of payments at. If you haven't made the payment in time to get to the processing center two states over, you can make the payment at the branch and get credit for it the same day. I do this routinely, Bank of America being everywhere. I wait until just a couple of days before it's due, then drop it off, allowing my money to stay in my checking account earning its pittance of interest for a little longer.</p>
<p>Get only ONE credit card...and I second the motion about getting one through where you do your banking. Many banks (Bank of America is one) have combo plans for college students. No fees for anything as long as you are a student. The nice thing is that you can easily transfer money to pay your credit card bill from your checking or savings online. Do NOT get more than one credit card. Just don't do it....not necessary.</p>
<p>Very well, thanks guys.. I'll look into it.</p>
<p>I may be the parent that Theanalyst was referring to. My daughter did not get one as a HS senior or college freshman or sophmore because she didn't see the need for one and we didn't either. She had/has a debit card and that's worked well. However, this Spring she'll be doing a study abroad so we thought it would be a good idea to get one. She has been turned down 4 times by credit card companies that advertise themselves as offering credit cards for students, including one from her band with only a $350 credit limit. The reason for turning her down have all been that she has ,"no credit history." She's worked since she was 16 every summer and has never had less then a $200 balance at her bank and is in her colleges honor society. In other words, a real trustworthy person. We're not sure what to do and even though she occasionally still gets offers we don't want her credit card history screwed up with even more denials.</p>
<p>Teens and credit cards can be scary. There is a thread here with kids who have run up their credit cards and have a lot of debt</p>
<p>oops, that's supposed to be "from her bank" not BAND. too late to edit! Band's would probably be more generous then $350 limit!</p>
<p>I HIGHLY recommend that students get a credit card (not a debit card) as early as they can in order to build up the history. If you teach them how to behave financially, they will benefit greatly from the extended credit history, rather than having to suffer with a low credit score right out of college (due to the lack of credit history) at a time when they may be applying for a lot of things that are dependent on your credit score (loans for grad school, car insurance, etc.).</p>
<p>I hear a lot of parents that recommend debit cards as a replacement. While I think it is okay to carry a debit card to use at an ATM (I do), I hightly recommend NOT using a debit card for anything else--especially POS or internet purchases. Only use a credit card for purchases. If you debit card information is stolen (or there is an error with the charge), the money leaves your account. While I do believe that many banks do now afford you the same protection as if had a credit card (you are only liable for the first $50 stolen), that was not always the case and may not be the case for every bank. It's much less worrisome to call up a credit card company and dispute the charges rather than to wait for a bank to investigate and then return your money.</p>
<p>Additionally, you do not build a credit history with a debit card.</p>
<p>kathiep: Just FYI--a denial has no effect on one's credit score. When you apply for something (such as a loan or a credit card) and someone else pulls your credit report as a result (called a "hard pull"), that pull is what dings your credit report. Whether or not you are approved for the credit card/loan does not have an effect.</p>
<p>theonekid: I recommend the 1st Financial Bank card. I have it and it's done well for me. Mine has a relative low rate and it is essentially free for the first $250. It also has a cash back feature (so, if you use your card regularly but pay it off within 30 days, you will actually make money off of your credit card). The only issue with them is that they do not accept online payments, so I have to actually write a check out every month (their checks are only physical check I have had to write in the past two years with the exception of my school). I also second the motion of checking with your bank--Sovereign Bank has an excellent student credit card with a 9.99% APR.</p>
<p>No matter what you do, always read the terms thoroughly and ask questions about things you don't understand. You don't even (though you should) have to read the fine print--every credit card application is required to come with a nice little chart that summarizes the terms. Never take a card that has an annual fee--there are plenty that don't. Check the rate of compounding and make sure that the card DOES NOT utilize the double-statement balance method of computing your interest charges (something that is a relatively new that not everyone has learned to look for).</p>
<p>i think it's good for kids to have a credit card. if they abuse that and charge up a zillion dollars of things, then that is their own fault. if you are old enough to have a credit card, then you are old enough to be responsible for your actions... i don't feel sorry for any of the kids who run up huge charges on their cards.</p>
<p>I got my first REAL credit card when I was 16. It was (i still have it) a Capital One Student Credit card. My mom co-signed for it. When I turned 18, i got a nice little letter stating my mom was no longer associated with it and it's completely in my name. I started off with a limit of $1,000. Of course, it's increased over the years, and is now a Platinum account.</p>
<p>I just recently applied for another Capital One account and recieved another Platinum Visa account with a limit around 10-15k. </p>
<p>Getting a card early really can help to establish credit... My credit rating was 760 when I applied for my latest credit card... I'm not sure what it is now... of course, I have student loans as well as a car loan so that plays a part as well... but I'd strongly suggest a kid getting a card when they go off to college.. especially because they're away from home and you never know when you need quick cash.</p>
<p>I'm very interested in this, as I've used a debit card only through undergrad, but I'm thinking of getting a credit card to build up my credit score now that I'm graduating.</p>
<p>Does it help your credit score to merely have a credit card, or is it necessary to also use it (and, of course, pay it off) somewhat frequently?</p>
<p>I wouldn't subscribe to any card offer that comes through a mail solicitation, nor one that comes in one of those packages offered to new students during college orientation. </p>
<p>If you're a senior in high school, I would get one now from the same bank as your parents bank at. This is likely to be easy. Then if you want to build your "credit limit" from the initial level, the thing to do is to start using it to buy things on your card that your parents might already still be spending on you with their funds (perhaps clothes, for example). As you build up a history of on-time payments, including occasional times when you don't pay it all off each month, your credit worthiness actually increases and your "limit" will increase or can be increased based on your record.</p>
<p>Furthermore, once you're away at college, you find that it's rather easy for your parents to help pay some of your credit card bills through a simple within-bank transaction. This is what we did for my daughter, who had an account at the same credit union where we do our banking.</p>
<p>I had to laugh when, after graduating from college and moving to NYC, my daughter opened up a new banking account in the city. The bank declared that she had "excellent credit," even though she had scarcely ever paid off her account herself over the years. In effect, by encouraging her to cover some of her monthly expenses while at college by using her credit card (with us paying it off through an intra-bank transfer), we provided her with excellent credit. The bank was happy to extend her a line of credit (instant cash), and also offered her another credit card (which she declined).</p>
<p>your post really made me smile when you said about parents helping pay some of the credit card bills. i wish my parents gave me a dime towards my credit card bills in college... or anytime for that matter :)</p>
<p>Precisely because credit cards are so scary, it's important to teach kids how to handle credit as early as possible. As long as the teen works and therefore has a way to pay the monthly bill, and is required without fail to pay the bill in full each month, I think they will be less likely to get into trouble with credit when they are on their own.</p>
<p>We pay both S1 and S2 to cook dinner (must do all planning, prep and clean-up for the entire family; no frozen foods) as a flexible way for them to earn money during the school year. They both have regular jobs in the summer. They carefully calibrate their spending based on how many meals it will cost. We ate pretty well the month of the new lacrosse stick. (Both have become excellent cooks as a side benefit.)</p>
<p>Credit cards for HIGH SCHOOL STUDENTS? What is the world coming to? NONE of my fellow high school students had credit cards. And no, I didn't grow up in the 1930s. I'm not even old enough to remember Watergate, 8-tracks, the Bicentennial, or the death of Elvis. Bush was president when I was in high school. The Bush-Quayle administration wasn't that long ago.</p>
<p>jhsu - the reason why i got my credit card when i was 16 was basically for getting gas. all of the places around here became prepay or credit, and it just was easier for me to do it that way. plus it was a good way to start building credit... and i worked 5 days a week all year round to pay for all of my bills... as long as you pay your bill in full at the end of the month there is no problem..</p>