Teach Your Teen About Credit: It’s Not Too Soon
The Internet is full of information on credit, but there’s a lot of misinformation that your teen could come across while doing independent research. It’s important that your teen has a firm grasp on credit before going off to college or into the workforce. It’s imperative they know the impacts credit could have on them in the future. As you know, your teen’s credit score can have a major impact on his or her life in the future. It can affect your teen’s ability to obtain a loan, mortgage, or even impact his or her future employment. So, how do you explain credit to your teen? This post will provide you with 7 credit tips for teens.
7 Credit Tips For Teens
- Credit Tips For Teens: Make Sure They Understand The Importance Of Their Credit Score
From report cards to SAT scores to sports stats, teens are well aware of how numbers represent accomplishments and responsibilities. It’s important to explain credit in a way yourteen can understand. Make sure they understand that their credit score has a major impact on his or her ability to get necessities in life such as a house and a car. Putting real-life examples behind credit can keep your teen’s interest, and make them feel like credit really does apply to them.
- Credit Tips For Teens: Stress The Importance Of Paying On Time, Every Time.
It’s important your teen understands that credit cards aren’t free money. Just because they are not paying the money up front, does not mean they don’t have to pay it back at a later date. Emphasize the importance of making payments each month, and explain to them the negative effect late payments can have on their credit score, and how this could impact their future.
- Credit Tips For Teens: Explain Minimum Payment
Make sure your teen understands that making only the minimum payment on a credit card will result in interest charges. Provide your teen with an example. For instance, would he or she rather pay $20 for a shirt now or $25 for it later? This will help them understand that making only the minimum payment each month makes their purchases much more expensive in the end.
- Credit Tips For Teens: Teach Them To Not Spend More Than They Have
One of the fastest ways to get into credit card debt is to spend more money than you have. Help your teen understand the importance of not over spending, and teach them how to differentiate need from want.
- Credit Tips For Teens: Responsible Credit Card Use Helps Build Credit
Explain to your teen how lenders use credit score to approve or decline loan requests. He or she will understand that a higher score correlates with a higher chance of being approved for a loan. Make sure they understand that credit takes a while to build, and emphasize the importance of practicing smart spending now.
- Credit Tips For Teens: Teach Responsible Online Usage
In our digital world, online shopping is an everyday activity for many people. Educate your teen on where they should and should not use their credit card online. For instance, advise your teen to never enter his or her credit card information on a checkout page that is not secure. He or she will be able to tell if the site is secure by looking for https:// instead of http://. In addition, secure sites will have a little padlock icon before the URL. Also, make sure your teen knows not to enter his or her credit card information while using public Wi-Fi. This would include teen hot spots like the mall, coffee shop, school cafeteria, etc.
- Credit Tips For Teens: Teach Your Teen Responsible Debt Isn’t Bad
Help your teen understand that credit and debt can help people make investments that they could not afford otherwise, such as a car, house, home repair, or even college education. Help you teen understand that responsible debt not necessarily a bad thing.
Resources To Teach Your Teen About Credit
- Surviving A COVID-19 Summer With Kids
- 8 Smart RV Buying Tips
- How To Celebrate The 4th of July Virtually
- 8 Financial Tips For High School Seniors
- 10 Ways to Support Local Businesses
- 9 Tips For Working Remotely
- 6 Ways To Budget During COVID-19
- Struggling To Pay Your Loans? Here’s What To Do
- How To Avoid Coronavirus Scams
- Best Places To Watch A Launch On The Space Coast
- 10 Tips To Prepare For Tax Season
- How To Raise A Money Smart Kid
- How to Avoid Bad Check Scams
- 9 Frugal Family & Date Night Ideas!
- 8 Ways to Jump Start Your 2020 Financial Resolutions
- 8 Easy Ways to Avoid Holiday Travel Stress
- 4 Tips On Snagging a Lower Interest Rate Mortgage
- 7 Tips for Avoid Cyber Criminals on Cyber Monday
- Avoid Gift Card Scams This Holiday Season
- Make Your Auto Loan Process Seamless: Here’s What You Need to Refinance!
- July 2020
- May 2020
- April 2020
- February 2020
- January 2020
- December 2019
- November 2019
- October 2019
- September 2019
- August 2019
- February 2019
- January 2019
- December 2018
- November 2018
- October 2018
- September 2018
- August 2018
- July 2018
- June 2018
- May 2018
- April 2018
- March 2018
- February 2018
- January 2018
- December 2017
- October 2017
- September 2017
- August 2017
- July 2017
- June 2017
- May 2017
- April 2017
- March 2017
- February 2017
- January 2017
- December 2016
- November 2016
- September 2016
- August 2016
- July 2016
- June 2016
- May 2016
- April 2016
- March 2016
- February 2016
- January 2016
- December 2015
- November 2015
- October 2015
- September 2015
- August 2015
- July 2015