Student credit cards and young credit

Are you smarter about credit cards than a 5th grader?


You may be surprised at how closely a child’s view of the credit card world comes to the actual way plastic works — as opposed to the carefree convenience touted in most credit card television commercials.

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When it comes to credit cards, are you smarter than a fifth grader?

To find out, we enlisted the help of teacher Robin Davis at Baranoff Elementary School in Austin, Texas, who agreed to give her fifth grade class a 10-question pop quiz to test their knowledge of credit cards: what they are, how they work, who gets them and how they differ from cash.

We’ve changed their names to protect their identity, if not their lunch money. Misspellings were corrected unless the original was hilarious.

Granted, you probably have an advantage here in that you likely actually own and use a credit card or two or 20, while your competition operates strictly on a cash basis.

But you may be surprised at how closely a child’s view of the credit card world comes to the actual way plastic works in real life as opposed to the carefree convenience touted in most credit card television commercials.

Didn’t know you automatically get a card when you become an adult? Or that poor people, hobos and babies need not apply?

Brace yourself: This could get funny!

Question 1: What is a credit card?

Overall, the class fared well on this question. They grasped the concept that there’s money somehow tied to that plastic card. Those who did elaborate seemed to sense there’s a catch to it.

For instance, Adrian says: “It is a card that holds money in it and it has a random amount of money in it.” Admit it, haven’t you felt the same way about your cards lately?

Dale, in his youthful wisdom, absolves himself of any financial obligation upfront: “A credit card is a card that doesn’t hold money, but every time you use it puts like a list of stuff and then they take the money out of the bank.”

While we’re not sure where Leslie got this information, but sadly she may be correct in some cases: “A credit card is something paying double for someone else’s money.”

Question 2: Why do people use credit cards?

Ah, if only we adults had an answer for this!

Some of our fifth graders felt a credit card’s main purpose was to relieve weary adults from the physical strain or space limitations of carrying around fistfuls of cash. As May puts it: “It’s faster than pulling out a ton of dollar bills.” Dora agrees: “You can have a lot more money on it than fits all in your purse.” We wish.

Mike sees plastic as a handy backup, “so they don’t have to always go to the bank to get money.” Carli agrees for another reason: “They might not have money so they pay it later.” Look for Carli’s personal finance book to hit stores soon.

For our money, Leslie once again grabs the gold star: “People use credit cards because they are lazy to use money.”

Question 3: Where do credit cards come from?

No, not the credit stork; these are fifth graders, after all! Then again, some of them aren’t exactly sure…

Mike: “A place?” May: “A bank?” Ryan: “A company?” Bruce: “Company that makes them?”

Dale, however, seems to have it all figured out: “Credit cards come from a bank store or a credit store or when you get a license you get a card.” By the way, should you own or work in one of those credit stores, please give us a call.

Leslie may not know the physical location from whence cards are dealt, but she definitely has a childlike bead on the credit card industry’s soul: “Credit cards are from using other people’s money.”

Question 4: How do you get a credit card?

Frankly, this one stumped half the class; the other half correctly answered that banks and retailers were most likely to offer an embossed card upon proof of creditworthiness.

Other interesting alternatives surfaced, however. How do you get a credit card?

Meredith suggests: “You buy one.” OMG, don’t give the card industry any ideas!

Caleb opted for the old campaign-trail dodge-and-weave: “You get it in the mail.”

Jamie reasoned: “You get it from your Mom and Dad.” True in many instances, for a limited time only.

It was Adrian who detected one major qualifier that separates kids from cardholders: “You get a credit card in the mail when you are adult.” To which we add, and sometimes before!

Question 5: Who can get a credit card?

This one turned up an interesting array of answers, some of which ought to be correct, even if they aren’t. They include Casey’s, “People who have money,” Harry’s, “Everybody who can afford one,” and Jessica’s, “Anyone who can pay the monthly bill.”

May’s answer, “Any citizen,” sounds kind of patriotic and certainly in step with the Bush administration’s spend-to-save tax rebate strategy. Troy’s answer, “Anybody who asks for one,” is probably closer to the truth.

We applaud Bruce’s logic: “People that are eligible.” Dale’s “Anybody who is legally righted for money” sounds correct in the nautical sense. But we must admit, when we read Caleb’s, “People that have a good enough credit score,” we wondered if he had an iPhone squirreled away under his desk feeding him answers off the Internet.

Sheryl takes the prize for giving us cardholding sheep a little long-overdue cache: “People who have IDs of some sort and belong to a special company.” Heck, she could even be right: Get deep enough in debt and you will belong to a special company — your credit card company!

Question 6: Who can’t get a credit card?

From those few overachievers who didn’t simply answer, “opposite of number 5,” came an interesting mix of logic, knowledge and bald-faced guesswork.

May answered: “Babies.” Leslie added: “Pour people and hobos.” Casey reasoned: “People that don’t have money.” Dale explained: “Anybody that has been like in prison or you’re a felony person or something.” (Felony? No problem. But it’s this “something” on your record that troubles us, Mr. Jones.)

Leave it to Jamie to bag the definitive answer. Who can’t get a credit card? “A credit card thief.”

Touch\xe9, Jamie, touch\xe9!

Question 7: How can you tell if you need a credit card?

This question required some abstract thought. Boy, did we get some abstract thought!

One group saw credit cards primarily as the solution to a cash-flow pinch. Carli says: “You can tell if you need a critit card if you have no money but going to get money soon.” Sheryl: “If you don’t have anymore cash or checks or start paying things later than the due date.” Sheryl’s book on debt management coming soon.

Another group held the opposite opinion. Troy: “When you’re getting bored walking around with hundreds of dollars in your pockets.” May: “You have too much money in your wallet.”

Caleb’s answer made enough sideways sense as to be truly profound. How can you tell if you need a credit card? “If you have a job.”

Question 8: How are credit cards different from money?

OK, to a fifth grader this was a loaded question. Among those who did not answer “it’s plastic, not paper” (feel free to insert either “duh” or “stupid” here) came these insights:

Carli: “With a critit card you have to pay the company back for the money you spent and with money you just have to pay that one price.”

Caleb: “Because they’re plastic and you have to pay a bill at the end of the month, unlike cash.”

Trevor: “You cannot give the cashier your credit card to keep but you give the money to the cashier to keep.”

It’s Tony, though, who gets our vote as a future hedge fund manager: “A credit card is different from money because you won’t run out so fast.”

Question 9: Who pays for stuff bought on a credit card?

Casey and Leslie answered, incorrectly: “Other people.” Actually, Leslie answered, “Other poople,” which may not be the same thing at all.

Caleb and Julie had the correct answer: The cardholder does. Jamie isn’t above playing the age card, however: “You or Mom or Dad.”

Our favorite answer comes from 10-year-old Ryan. Who pays for credit card purchases? “Grown ups.” At least the flush ones!

Question 10: What happens when your credit card is lost or stolen?

This opened a Pandora’s box of possibilities, beginning with May’s response: “People could use it.” Indeed they could!

Hence Jamie’s no-nonsense suggestion: “Look for it and call your Mom and Dad.”

The problem, says Tony, is: “If your credit card is stolen then the person who has it can spend as much as they want.”

Harry has the solution, which most of our fifth graders knew: “You cancel it immediately and order a new one.”

But it’s still a good idea to call Mom and Dad, just in case.

See related story: “How to prepare your children to handle credit

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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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