Talking to Your Kids About Credit

December 14, 2018 by Lily Wright

If you’ve ever racked up a little too much debt or watched the number of credit cards inside your wallet pile up seemingly over night, you’re not alone. It’s no secret that credit card companies bank on the fact that you’ll probably misuse them, and the convenience of having one is almost a trap in itself. It is far too easy to pull out your credit card and pay for a pricey dinner out, or a new jacket you’ve been eyeing, or even the newest iPhone you’ve been dying to own. To put it simply, debt is quick and easy to accumulate if you’re not being careful, and chances are good that if you struggle with credit card debt, you probably formed some bad habits when you were young. The key with learning how to use credit cards safely is to make sure you adopt the skills and knowledge required to use them at a young age, and it’s important to impart this knowledge on your kids as soon as possible.

As any American consumer, you’ve probably made a few credit-related mistakes along the way, and the most effective way to teach your kids about how to use credit is to share some of your own stories and mishaps. The idea is not necessarily to scare them, but to show how easy it is, even for the brightest people, to slip into debt. By sharing some real life scenarios and explaining ways to avoid the mistakes, your kids will understand in a personal, easy-to-digest way.

If your children are of the appropriate age, you might consider making them an authorized user of your account, granting them access to usage, but also helping them build credit early-on. As teens, they’ll be able to learn how to utilize credit under your supervision, which will (hopefully) prevent them from making extraneous purchases or over-spending right off the bat. It will also help to have you sit down each month and explain what your credit card statement means, what happens with your credit score over time, and how to carefully pay off any debt you accrue. A watchful eye and helpful suggestions and insights are a great way to provide “training wheels” for your kids before transitioning them to their own account as they get older.


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