Parents can make a big difference in helping young people stay away from bad debt. While some may totally disregard the idea of allowing students to handle their own accounts, owning one can actually be beneficial. Below are useful tips for parents with kids who have an account:
Ease and safety. Using a credit line is a much safer mode of payment for youngsters compared to bringing cash. In case the card is stolen, the student can simply call up the bank and have the account frozen.
Know where the money went. You should also keep track on how your kids use their plastic cash. How can this be possible without being too intrusive? Speak with your kids and encourage them to review their monthly billing statements with you. It’s only fair enough especially if you agree to help them with repayment.
For emergency purposes. A credit card for student will surely come in handy during times of emergencies. When cash is not available on hand, important bills or purchases can be paid off through a credit card.
Building credit history. Building early credit history is one of the most important advantages of having a credit card in college. Remember that this is the only time you can apply for an unsecured card without credit history. When you graduate, having good credit rating will definitely work to your advantage.
Money management skills. Another wonderful benefit of having student credit cards is to hone young people’s money management skills. As parents you can give them proper guidance by allowing them to take responsibility over their credit card expenses.
Parents – Do Your Part
The guidance of parents is truly important. Help your kids from choosing the right college credit card, to understanding their issuer’s Terms and Conditions, and giving advice on how to manage their accounts more effectively.
Having the first hand experience of managing a real credit card account is a great preparation for a young person who’s about to enter the corporate world. Talk to your kids about the importance of keeping their credit history in good shape, as it will prove to be a major advantage after their college graduation.