A credit card designed for children is a great tool to help them build a good credit record. The process is simple. Simply add your child to the authorized users list online and the company will mail the new card. A great reason to apply for a credit card to your child is the increasing popularity of credit cards. T.RowePrice recently found that 17% parents of children aged 8-14 had a credit card.
Greenlight
Greenlight credit is an option for parents who want to get a credit card that will allow them to pay for their kids' college expenses. The green card includes zero card purchase fee, zero ATM fees, foreign transaction fees and other benefits. You will also enjoy features such as allowance tracking and contactless payment, along with a low $4.99 per month service fee. It helps children develop financial responsibility by attaching chores to allowances and rewards. Children can use it to check chores off and get instant notifications when they are complete.
Parents have two options. They can either load money manually to their child’s Greenlight account or they can make recurring transfers. This allows weekly allowances to be automatically added to the card. You can also have your child's account set up by parents with parent-paid interest.
GoHenry
The GoHenry kids credit card is designed with financial education and simplicity in mind. The card features include a customized debit card and an app that allows kids to set savings goals and manage spending. The card is FDIC insured, so parents can track their child's spending via the app. Parents can also track spending trends and view their child's past spending.
The GoHenry debit cards for kids and Greenlight credit cards for teens are both designed to teach financial responsibility. The app includes a colorful budgeting tool and a chore tracker, which adds money to your card when you complete household chores. This app gives parents the opportunity to monitor their children's spending habits and encourage financial responsibility.
Apple card for iPhone
Apple's new credit-card for kids is a great tool to introduce children credit. This card includes a variety features including spending limits, and the ability of setting up a budget. Through an educational approach, this card helps children learn about financial responsibility. They can share the card with an older sibling.
Parents can also set spending limits and create a family sharing group to track spending. Parents can invite as many as five people to use their card together and build credit. Each user must be at the least 13 years of age and agree to pay for all spending. Both owners are responsible for payments, and the activity is shared with the credit bureaus.
Secured credit cards
Secured credit card for kids can help build credit histories. But there are some things you need to be aware of before allowing your child to use one. Secured credit cards are costly and come with high interest rates. Over-limit transactions will incur a fee. The downside to a secured account is the inability to transfer funds between cards. Better is a card that allows for you to set a spending limit, and then you can change it at any time. Your child shouldn't have a high-limit card and then discover that he/she cannot pay it back.
Secured credit for kids cards can teach your child money management skills and help prevent over-limit fees. They can be used to teach your child about credit limits, and help you build credit history. It is a good idea that they start young to help avoid major credit card mistakes later.