Should teenagers have credit cards? This is a question that every parent is facing these days and there is more pressure on this issue than ever.
As in any debate or issue, there are two very relevant sides to the issue and both sides have some exceedingly valid arguments.
On the one hand, kids having credit cards should teach them how to budget money and make sound financial decisions about money. They learn that if they want something and are responsible enough to work to have it, they can get it now and pay for it later. The down side of this is that peer pressure these days is at an all time high for teens and if they are just hanging out at the mall with all their friends and everyone has one thing and he does not, the credit card allows him to bend to that pressure and go pick up that $300 coat or $150 pair of jeans that everyone else is wearing and he has to have to fit in and be cool.
Without that credit card the teen would have to grin and bear it and then figure a way to talk mom and dad into the purchase. With the credit card, it can get tucked away on the bill and the parents may not ever even see it. Yes, there are still some folks out there that do NOT read every statement they get from Credit Card companies.
A credit card is nice to have for the teen for emergencies. Say they are at a big party and the alcohol and illicit items begin to show up. The teen can then call a cab company and use the card to get a secure ride home and not have to bother mom and dad with the dreaded middle of the night wake up call to come and rescue him from the party, or worse yet, a holding cell at juvenile detention.
It can also work the other way, if at that same party someone gets the idea that pizza would be nice, it’s way too easy for your card carrying teenager to call up the pizza delivery place and put a couple dozen pizzas on the plastic.
So what is a parent to do with this dilemma? You could hope that you have educated them well enough that they won’t go crazy. But that’s not very re-assuring. A better option might well be the Pre Loaded Debit cards. You can buy them almost anywhere now days and load on what you allow them to spend, or even the allowance, if you do that for them, for the month and let THEM figure out how to handle the card.
If they go crazy with it, the card will stop them when it’s empty, you can explain to them that if the card should reach zero the person swiping the card for them will inform them that the card was declined and they will have to figure out how to explain that to the friends.