School opening is once again near. Many people are preparing to make sure that everything will be in place before classes begin. This post presents essential credit tips for parents:
Educate Your Kids About Credit Management
Parents can be of great help in helping young people to become responsible in managing finances. If you think that your child is old enough to handle a student credit card, don’t just pick one out for them. Instead, get them involved with the process.
As you compare different types of credit cards for students in the market, why not conduct your search with your kid? Explain to them why it is important to do comparison instead of just signing up for what seems to be a good credit card deal.
As first time cardholders, there might be credit card terms that they do not clearly understand. By explaining credit card terms and their implications, your child can be more conscious about how these terms and conditions must influence their choice.
Protect Them from ID Theft and Fraud
Young people needs to be aware that identity theft and fraud are serious crimes which can put them in danger. It is also a parent’s duty to instruct his/her child about the possible risks and how to avoid being a victim of identity thieves and fraudsters.
Is your child aware that he/she must never give out personal information to other people? ID thieves today are taking advantage of the internet to steal information. Students must learn how to distinguish a secured website from an unsecured one. They must also be alerted about the tricks identity thieves use to steal confidential information.
College Students Need Help Too
College students often want independence but this does not mean parents should not pay attention at all. If your child is older than 21, then it is easy to apply for a student credit card without the help of a co-signer. Still, you can assist your child by giving recommendations as to which credit card issuers provide the best service. Since you have an experience in managing a credit card and building credit history, your college kid will surely benefit a lot from your opinion and advice.
On the other hand, the new Credit CARD law prohibits students who are under 21 to acquire a student credit card on their own. However, if a student has an independent source of income, he/she can own a student credit card without a co-signer. This change in the CARD Act has been made in an effort to reduce the incidents of bad credit, especially among student cardholders.
Generally, anyone with good credit can guarantee the account but unless both parents have bad credit, then they are the best candidates to be a co-signer. More than just co-signing the account, you must make sure that your child understands his/her rights, responsibilities and limitations.
Will you help your child in paying the monthly credit card bills or will you allow him/her to pay for the debts? In any case, parents must encourage their children to speak with them right away, in case they might have issues or problems in managing their student credit card account.
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