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Choosing the right credit cards as your family grows


From having a baby to sending kids off to college, each parenting stage comes not only with different expenses but also opportunities to earn rewards points or cash back

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When you have a baby, your daily spending habits change almost instantly. Gone are the days of eating out a few times a week, hitting the bar for happy hour or traveling to Paris on a whim.

When big life changes cause dramatic changes to your spending habits it is a good time to rethink your credit cards.

“A lot of young couples focus on cards that offer straight travel rewards because they’re the most valuable, but that typically doesn’t make sense anymore after you have kids,” says Judah Ross, who blogs about credit card rewards at “It’s a good idea to look at other cards and evaluate them based on what your goals are.”

Consumers tend to stick with the same credit cards even when their habits change, says Jim Miller, senior director of banking at J.D. Power. As a result, more than 1 in 5 credit cardholders have a card that is poorly aligned with their spending habits and reward preferences, a 2016 J.D. Power study found. Indeed, a 2107 survey found that 38 percent of cardholders rarely change cards, if ever.

To maximize your financial flexibility and your credit card rewards, the cards your carry in your wallet should evolve as your family grows and your spending changes. Read on for the types of cards to consider at each stage of your family life, based on what your goals are.

New baby:

  • Maximize rewards with cash back cards with simple rewards systems or a store-branded card from the retailer where you plan to buy diapers.
  • Help pay for big-ticket items with a card with 0 percent interest and a long introductory period.

School-age kids:

  • Maximize rewards with a card that rewards you for spending on groceries and gas.
  • Travel with the family with a card that has a flexible travel rewards program.


  • Build your teen’s credit history with a card that will let you add your child as an authorized user.
  • Save for college or retirement with a cash back card that links to a 529 college savings plan or retirement account.

Kids off to college:

  • Pay off debt with a 0 percent balance transfer card.
  • Maximize rewards with a premium travel card with a big sign-up bonus or a card that gives you extra points for dining out.

Parenting stage: New baby
When you have a baby, you face myriad new expenses – from baby gear and diapers to medical bills and child care – at a time when your discretionary income typically drops, says Jeff White, who helps small-business owners with financial planning at

If you think you may need to use credit to ease the burden of all those extra costs, look for a 0 percent introductory rate credit card, for an introductory period. White says. Just make sure you pay off that debt before the introductory period expires.

To maximize your rewards, choose an easy-to-use card that will reward you for the spending you’re going to do anyway.

Skip cards that give you extra points for entertainment, travel and dining out, since you’ll likely cut back in those categories. Instead, consider cash back cards that put money in your pocket every time you dip or swipe. Cash back cards are easy to use, and many offer a flat rate of 1 to 2 percent back, Ross says.

Financial planner Sophia Bera, founder of Gen Y Planning, says she encourages clients who are new parents to consider a store-branded card from the retailer where they plan to buy diapers and other baby necessities.

“You know you’re going to spend a ton of money on your baby, and all of those places have cards that give you money back, and you don’t have to do anything special to redeem the rewards,” she says. For example, both the Amazon Prime Rewards Visa Signature card and Target Redcard offer 5 percent back on Amazon or Target purchases.

“You know you’re going to spend a ton of money on your baby, and all of those places have cards that give you money back, and you don’t have to do anything special to redeem the rewards.”

Parenting stage: School-age kids
As your kids grow, you’ll spend less on diapers and child care, but that doesn’t mean your overall spending will drop. A USDA analysis found that family expenses actually increase as a child ages.

You’ll shell out more for gas to ferry your children to extracurricular activities and, of course, your grocery budget will grow. So you should consider shifting to a card that rewards you for spending in those categories, Ross says.

The Blue Cash Preferred Card from American Express is one of the most generous cards for grocery rewards, Ross says, offering 6 percent cash back at U.S. supermarkets (up to $6,000 a year, then 1 percent) and on select U.S. streaming services as well as 3 percent back at U.S. gas stations and on transit and 1 percent on everything else. Another good option: The BankAmericard Cash Rewards Visa, which offers 2 percent back on groceries, 3 percent back on gas and 1 percent on everything else.

If you want to take your older kids on vacations that require airline tickets and hotel stays, sign up for a card with travel rewards. Most offer a bonus just for signing up; that alone often can cover the cost of one or two domestic airline tickets.

Since it can be tough to find multiple awards seats on a specific flight, consider a card with a flexible travel rewards program. For example, the Chase Sapphire Preferred or Sapphire Reserve cards allow you to transfer points to several different airlines or hotel chains. You also can book travel directly through the Chase Ultimate Rewards program’s online portal and get a discount.

Video: 3 ways kids can build credit

Parenting stage: Teenagers
Once your child is 16, many experts recommend making your teenager an authorized user on one of your credit cards to help build your child’s credit history. Most major card issuers allow you to add a minor as an authorized user, although some impose a minimum age. Keep in mind that just because you add your teen as a user doesn’t mean you have to give them the card.

“Even if you just stash their card in a drawer, that will still help their credit history down the line,” White says, as long as the primary cardholder keeps the account active and in good standing.

When it comes to credit cards for yourself, consider what your changing financial goals. If you want to put some extra money away for retirement or college costs, the Fidelity Investments Visa Signature card links to your brokerage account at the firm. The card then pays 2 percent on every purchase, with no limits or caps, and you can funnel that money into a 529 college savings account or a retirement account.

If your goal is to maximize rewards, you may want to consider cash back cards with rotating bonus categories. The Chase Freedom, Discover it® Cash Back, Citi Dividend and U.S. Bank Cash+ Signature Visa cards offer 5 percent cash back each quarter in a different category such as gas or dining. (With the U.S. Bank Cash+ card you get to pick two categories per quarter for 5 percent cash back.) The Discover it Cash back offers 5% cash back in rotating categories, on up to $1,500 a quarter, then 1 percent, enrollment required.

The challenge with these rotating cash back cards: You need to keep track of the categories and opt in to benefit, but hopefully you’ve gained some free time now that your child is more independent. They also include quarterly spending maximums before dropping to a lower rewards rate.

“Consumers should switch cards frequently as their spending habits change and the issuers change their offerings. … If they don’t, they are probably leaving money on the table.”

Parenting stage: Kids off to college
Now that you’re an empty-nester and retirement is on the horizon, it’s a good idea to pay off any remaining debt. If you are carrying a balance on any credit cards, transfer it to a no-fee 0 percent balance transfer card with a long introductory period, and make a plan to pay off the balance before the promotional period ends. The last thing you want is to carry debt into retirement.

If travel is your goal now the the kids are off to college, sign up for a premium travel card with a big sign-up bonus to help pay for those dream vacations. You also may want to consider a card that rewards you for dining out, since you may not cook as much with the kids out of the house. The Chase Preferred and Reserve cards offer 3 percent back in both of those categories (dining and travel), Ross says, so they are a good pick for empty-nesters.

If a no annual fee credit card with rewards for foodies is more your cup of tea, Capital One’s new Savor credit card and Chase’s AARP credit card both offer 3 percent back on dining at restaurants.

As your children grow from diapers to school uniforms to college gowns, different credit cards can reward your changing household spending.

A 2017 J.D. Power survey found that as credit card customers age, they are less likely to switch to new credit cards, but that’s a mistake, Miller says. “Consumers should switch cards frequently as their spending habits change and the issuers change their offerings,” he says. “If they don’t, they are probably leaving money on the table.”

See related:Learn how to maximize card rewards for family fun, saving, Sending kids off to college with a rewards credit card, More parents giving their kids credit cards

Editorial Disclaimer

The editorial content on this page is based solely on the objective assessment of our writers and is not driven by advertising dollars. It has not been provided or commissioned by the credit card issuers. However, we may receive compensation when you click on links to products from our partners.

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