I’m not a parent, so I won’t presume to tell you how to raise your child. However, I can tell you that when it comes to teens and credit cards, putting plastic into their hands is a mistake that you both could end up paying for well into the future.
No matter how you try to justify it – “it’s a different world out there”; “all their friends have one”; “it’s just for emergencies” – giving a teenager the privilege of plastic is a bad decision that will cost you and the child more than money and which may have long-lasting, detrimental effects. Here are nine reasons why:
You’re Downplaying the Necessity of Work
Working and making cold, hard cash is in my blood. My parents never gave me a credit card; they told me that if I wanted something they weren’t willing to buy then I had to make money for it. So I did. That doesn’t mean I’m obsessed with work, however; quite the opposite, actually. I work to live, not live to work. That’s a distinction that has a profound effect on the quality of my life.
You’re Weakening Your Kids’ Work Ethic
Nobody wants to work if they don’t have to. And if you give your teenager even the slightest inkling that you’ll take care of them whether they can support themselves or not, there’s a high probability that they’ll take advantage of that. They’re kids, after all. And they’re going to push the limits of how much they can get away with. When it comes to teens and credit cards, t’s up to you to set those boundaries – before it’s too late.
You’re Conditioning Your Child to Be Materialistic
When I have cash in my pocket, I’m very discerning about what I’m buying. Not so when I’m putting something on my credit card. You and your kids are the same way. If your kids learn to use cash for their purchases, they’ll likely have a healthy American affinity for material possessions. Giving them credit cards, however, will facilitate overspending – and that will only get worse as they advance in their careers and make more money.
Your Kid Will Lose Respect for the Fine Print
Kids don’t care about the fine print on a credit card when you’re footing the bill. After all, why should they give a flying squirrel about the APR late fees, and all the other small-font mumbo jumbo for which you’re responsible?
You’re Courting a Break In Trust
I can almost guarantee that if you give your kid a credit card, then they will abuse it. High-schoolers may face peer pressure that forces them to act a fool with the plastic. As for college students, where somebody with an “emergency” credit card will need to make an “emergency” beer run. Par for the course; it’s going to happen.
Your Child Will Never Learn the Value of a Dollar
The only way to learn the value of a buck is to attach it to the time and effort it took to make that dollar. If money is handed to you, then you “learn” that there’s an endless supply of it and, therefore, no need to work for it. Enough with that “I want him to enjoy his childhood while he can” nonsense. Nobody’s childhood is being stolen from them because they have to work 20 hours a week.
You’ll Have to Bail Your Kid Out
Because your child will most likely abuse the plastic privilege, at some point you’ll have to bail them out. Doing so sends the message that Mommy and Daddy will always be there when the kid ends up in a financial bind. As a result, the stupid spending could become habitual – as could the burden on you to pay the bill.
You’re Increasing the Odds of a Credit-Dependent Child
We may be moving toward a cashless society, but cash is still king. So when it comes to teens and credit cards, it’s imperative that your kids know the difference between money in the bank, money in their hand, and borrowed money that they have to pay back. The best way to do this is to avoid plastic cards altogether, at least for the first few years, and stick with cash.
You’re Setting Up Your Kid for a Life of Debt
It’s your parental duty to send your kids out in the world as well-rounded as possible and that includes giving them a solid understanding of how money works, as well as the consequences associated with exhibiting a poor work ethic, being a spendthrift, and not appreciating the privilege of credit. Eventually your kids won’t be your problem anymore; they’ll be the government’s problem instead. And I promise you, the latter won’t be as easy on them as you. Even on the worst day.
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I think giving your kid a credit card is wrong or even co-signing, but allowing them to get one when young is great idea. A few caveats, they must understand they are responsible for the debt, the parent must let them be responsible, and the credit limit should be low. It is better for the child to make small mistakes when young, then be old and have the means to make big mistakes.
I agree with this article completely. I was never given a credit card when i was younger and still am not a big fan to this day. I do wish my parents had shown me how terrible they can be so I didn’t fall into the trap like I did in my college years.
completely disagree with this. When my son turned 18, I consigned on a bank visa with a $1000 limit. He has learned to pay it off every month, and been totally responsible. I’ve never had to bail him out. The benefit has been that he has been able to build a good credit score, and has absolutely learned to manage money. Having a card with available credit has certainly come in handy in emergencies, and allowed him to manage situations without having to call mom. He’s now 21. Good kid.
I seldom feel the need to comment on articles, but this one is just wrong. The author is assuming that any parent would just give a kid a credit card with no stipulations. My parents cosigned for a card for me when I was in college, and believe me, there were stipulations! I can assure you I never once bought beer with it. Now, as an adult, I am not terribly materialistic, my work ethic is just fine, I have zero problems with debt (my FICO score on my last Discover card statement was 848). All in all, my parents did a fine job raising all of us to be pretty decent, productive adults. They also understood the value of teaching us and then allowing us to make mistakes young, while they could be used as learning experiences. They haven’t had to “bail us out” (in any sense of that word) once we were adults. I can assure you that same thought process continues to the next generation as well. How can you expect anyone to understand how to use credit responsibly if you don’t allow them to use credit and hold them responsible?
“How can you expect anyone to understand how to use credit responsibly if you don’t allow them to use credit and hold them responsible?”
Well said, Charlene. And I agree with you 100%.
I have to disagree with the guy who doesn’t have kids. Both of my teens are authorized users, mostly for convenience. For example, I can text my son and tell him what groceries to bring home or have him fill up the gas tank. We gave our freshman daughter a card before a band trip to Disney. I certainly didn’t trust her with a couple hundred in small bills.
Trust me, I check my accounts regularly to make sure there’s no extracurricular spending. And my kids are very aware the balance is ALWAYS paid in full and that using a card is only a tool. It’s not a way to get more than we can afford.
Great points, Marie. We used to give our kids text message shopping lists too. Actually, we still do even though they are no longer teens!
I am a parent and totally agree with the article. Better to teach your kids that debt is dangerous and should only be used for extremely important purchases…mortgage, etc . Just my opinion. As an aside my 39 year old son owns two houses and my 43 year old daughter owns her place free and clear. They pay off cards every month from what I gather, but I don’t ask or meddle in their affairs and our relationships are respectful and very close.
My wife and I don’t do debt and I cherish the freedom of owing no one. Always have. Great going to work because you want to…….
Same here, Paul. As for our kids, one is a diligent saver and the other can’t seem to save a dime – although as the spender gets older, he is starting to come around a bit.