Whether you are just moving in with your wife, or you are starting the new life, credit cards can save you in multiple ways. According to Constantine Lycos’ Financial Advising Firm, building and establishing a decent credit score is imperative for young people who are planning to buy homes, cars or any other larger purchases.
Those are fantastic financial aids that must be used with caution. Using them correctly, you will easily get a good score, ensure yourself property and have a secure life.
Why should you get a credit card to your kid?
While they might not need it while they are under 18, it may become very useful for them to have a good credit score and to learn how to use a card responsibly. The card, since they are minors, cannot be issued on their own name, but rather on your name and connected to your account. This means that you are actually authorizing and paying for each transaction they make. They will get the card with their name on it, but the card is connected to your account as a primary source of funding.
In this way, your children will start learning about the responsible use of credit card, money and financial assets from the early stage. On top of that, this allows them to understand the saving and checking account, as well as to build their score. They cannot apply for the credit yet of course, but once they become 18+, they will have the chance to apply. In this way you teach them to handle finance and build a good score that could be helpful to them later. Once they understand how things work, they will know how to handle these situations later on in their lives.
When your children should get a credit card?
This depends on your preferences, situation, financial state and other things. If you can afford it, give them as soon as possible. The sooner they start to think about it and contemplate the idea of saving and getting credit, the better they will understand the whole concept. Limit their card in the beginning to emergency purchases only and then give them more freedom as they learn to use the card properly. You can start with this once they are 15-16 years old to give them enough time to realize how things work and how they will get their first credit to finance their needs.
It is not the point to give them money, but to teach them to handle their bills and money responsively. Once they become able to understand how to use the card and act like grownups, they will know and appreciate the use of credit card. Also, you encourage them to become independent from the early beginnings, which will make a smooth transition from a moment when they live with you to a moment when they have to handle everything on their own.