| Is your college-age child finding it | | | | This can be very beneficial, because |
| difficult to get a credit card? Many | | | | banks will often issue credit cards to |
| students face a catch-22 when applying | | | | clients who have proved, over time, to |
| for their first card. Some card | | | | be financially responsible. |
| companies market their products | | | | Retail Cards |
| specifically to students, yet the | | | | Like bank cards, credit cards from |
| students often get rejected when they | | | | retail stores are relatively easy to |
| apply. Why? Insufficient credit history. | | | | obtain. Try to select a store that your |
| If you don't have credit, many companies | | | | child will shop at, but not one where |
| won't extend credit to you. Thus, the | | | | you think they might be tempted to spend |
| dreaded credit catch-22. | | | | beyond their means. Make sure your child |
| If you're a parent who is concerned | | | | understands that the key to building a |
| about your child's credit score, take | | | | good credit history is to charge a small |
| heart. Here are five strategies for | | | | amount every month, then pay off the |
| getting them started down the path to | | | | balance in full. |
| good credit. | | | | Secured Cards |
| Car Loans | | | | Secured credit cards are another option |
| Teenagers eventually need cars, and it | | | | for teens and young adults who are |
| often falls to parents to provide those | | | | trying to build up their credit. These |
| cars. But the teens should be involved | | | | cards are secured by a deposit made by |
| in the paperwork, too. One of the | | | | the card holder into an account that is |
| simplest (and most overlooked) ways to | | | | set up specifically for this purpose. |
| start building your child's credit is to | | | | Then, if the card holder doesn't make |
| get them to co-sign for their car loan. | | | | their payments, the card issuer can take |
| Once their name is on the contract, they | | | | the money they're owed out of that |
| will begin to receive credit for timely | | | | account. Since this significantly |
| car payments. | | | | reduces the risk to the issuer, banks |
| Your Own Cards | | | | and credit card companies will issue |
| If your child is trustworthy, you can | | | | secured cards to applicants who might |
| add them to your own credit card | | | | not qualify for non-secured cards. |
| accounts. Any credit history associated | | | | With a little pre-planning and strategic |
| with your credit cards will then | | | | thinking, you can have your child's |
| influence your child's credit score. | | | | credit up and running in no time. |
| Bank Cards | | | | Whichever card you and your child decide |
| Start a checking or savings account for | | | | to go with, emphasize to them the |
| your child while they are in their early | | | | importance of not carrying a balance, |
| to mid teens. Make sure that the | | | | lest they get mired down in fees, |
| accounts maintain a positive balance. | | | | penalties and interest. Your child might |
| Then, by the time your child is ready to | | | | think you're nagging, but since when has |
| head off to college, they will already | | | | that stopped a good parent from getting |
| have a positive history with their bank. | | | | their point across? |