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