Have You Taught Your Student About Credit?

Uncategorized, credit

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Have You Taught Your Student About Credit?

Today many parents are afraid of giving their college age student the huge responsibility of a college student credit card. However shielding them from this altogether will hurt them in the future because of a lack of exposure to basic financial skills as well as a simple lack of credit history. They will be at a huge disadvantage when they decide to purchase a car or home on their own. Of course not every credit card will be suitable for a college students, teen, and credit novice, however with the right college student credit card it can be a very important financial tool. I have outlined some ways and ideas to help your college age student or teenage student understand better the basic finances of using a college student credit card:

1. Keep the initial credit limit under $500. Starting with a low limit will allow them to slowly deal with credit. Realizing there may be some mistakes made keeping the limit low will allow them more easily to fix that mistake.
2. Making timely monthly payments. Having them understand the importance of always paying the monthly payment on time. If not they will receive late fees as well as other possible consequences.
3. Setting rules on what the card should be used for. Making sure they realize this card should be initially used for emergencies. Knowing the consequences of running up the charges to the limit.
4. Paying your balance in full every month. Understanding the importance of paying the balance off is huge. This is what is creating a positive credit history. After all, that is what it is all about.
5. Understanding financial terms. If your college student understand what they are seeing on the monthly statement, it will further help them to treat there credit card with respect.

If your college student can understand the basics of what is explained above they will have a huge head start above many other young adults. What you also need to keep in mind is weather or not you approve, they will have an opportunity to obtain a college student credit card with or without you. So, be supportive and teach them what you know. If you have made some mistakes along the way, there is no harm in sharing that with them. Some kids actually do learn from there parents mistakes.

Give your college student the opportunity to have a leg up on the young adults around them. A college student credit card is a very important tool they should be taught to us. You be the teacher and teach them right. If you feel you are not up to the job, do some research on the internet. There are many sites that can help walk you through the importance of credit and your credit history. This is important for your young adult to achieve financial freedom. Be the one to give them that leg up and head start above the young adult around them. They will be forever grateful to you.

FIND credit info and a selection of student credit cards for comparison at www.StudentCreditCards.com

Student credit cards.com @ January 7, 2009