Things to Consider When Getting a Credit Card for Your Teen

Deciding whether or not you should give your teen a credit card is a big decision to make. You will be giving your young child the huge responsibility of managing his or her own finances. It can be quite scary, especially since many adults have fallen into debt nowadays. Teens that are not well informed about improper credit card use can face serious troubles, including debt. It is of great importance that as a parent you are able to guide your child in managing and using the plastic.

Picking the Right Card for Your Child

Once your son or daughter has come of age, it may be time for you to shop for your child’s first card. There are several credit cards for students that you can choose for your child. Here are a few things that you should reflect on while in the process of searching for the best option:

• Spending limit. High spending limits allow your child to spend more than he or she can afford. This could result to missing repayments and, eventually, debt. It may be a much better idea to go for a card that allows you to set the limit yourself. This enables you to control your child’s spending while giving him or her enough freedom to make purchases.
• Secured card. A secured card is a viable option for your teen, especially while you are still in the stage of teaching your child how cards operate. A secured card works just like a traditional credit card, but your child can only spend the amount that you have deposited in his or her account. If your child misuses the card, you always have the option not to make a deposit, thereby controlling how your child spends on his or her credits. 
• Joint card vs. standalone card. You can choose to give your teen either a separate card or a joint card. The latter is basically a card that is an extension of your existing one. With a joint card, you have the ability to monitor how your child spends the credits. When you see that your teen is savvy enough to be financially stable, you have the option to cancel the account connection and get your child his or her own separate card.
• Account number. Depending on the card that you have chosen, your child may be given his or her own card number if you ever choose a joint card. The other number can actually be beneficial for both you and your child in the event that you lose your card or it gets stolen. 
• Fees and Conditions. Do not forget to keep your eye on the card agreement. There can be terms and conditions that are too complex for your child to grasp. Make sure that you explain everything to your teen. Among the fees that you should watch out for are the annual fees, over the limit fees, finance charges, and the interest rates. It is always advantageous if your child completely understands what these fees are and how to avoid them. For instance, the interest rates are only levied on people who carry a balance. It is also wise to get your child a card that does not have an annual fee.

Remember that credit cards are not created equal. While there may be a number of cards that are made specifically for students, not all of them may fit your child's needs. As such, weigh things first carefully before deciding on a particular card for your teen.