What is a Credit Card? A credit card is a plastic card issued by a financial company that allows clients to borrow money from a bank and have it billed.

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Presentation transcript:

What is a Credit Card? A credit card is a plastic card issued by a financial company that allows clients to borrow money from a bank and have it billed to their account. Credit cards are meant for short term spending since usually after a month, interest is charged to the account.

Explanation of Credit Cards

Pros for a Teenager Having a Credit Card Large purchases can be made and be paid off in sections Budgeting becomes easier since you get a credit card statement It is more convenient

Pros for a Teenager Having a Credit Card It is a good way to practice responsibility One could build their credit score One could learn more about the value of money A way to prepare for the real world

Cons for a Teenager Having a Credit Card Credit cards could cause overspending due to the convenience Credit rating could be damaged due to irresponsible shopping

Cons for a Teenager Having a Credit Card Easily go into debt if not tracking spending Interest rates could turn small loans into large balances

Parental Support Based on if a teenager is read for a credit card is how much support they have. With some help from parents I believe teenagers would only then be ready to use a credit card. Gradually use credit cards, have a small limit and slowly transition from cash to credit when becoming more comfortable with it Start budgeting and saving money, to get use to it which can help pay debt Knowledge, give teenagers some type of education on money management skills so they understand consequences of irresponsibility with credit cards

What Age Should I Give My Child a Credit Card? Ages 4-6: Give simple information like what a credit card is Ages 7-12: Introduce how a credit card works and how payment is done Ages 13-17: Sign them to a joint-account for your credit card which allows you to monitor their use Ages 18 and up: Give them their own credit card if they understand how it works and have proper financial management skills

Should You Give Your Child a Credit Card? I believe that it is appropriate to give your child a credit card if specific conditions are met. If the child has a proper understanding of budgeting, the value of money, is responsible with making purchases, is at least the age of 15, and has been co-signed to a credit card with a parent for at least a year.

Thank you!