Parents should play a role in students' credit card selection

While college-age children may feel that they no longer need input from their parents, the reality is that many kids can still use some help when it comes to credit cards.

Data showing that students too often rack up sizable credit card debt in no way makes them unique, since U.S. credit card illiteracy is a problem across age groups and income brackets.  But since experts stress that the best way to control debt is to avoid it, college students are at an advantage.

By helping their children avoid getting into trouble with credit cards, parents may be able to prevent them from experiencing the debt that can trail consumers for years and cost thousands in interest charges.

After first taking time to explain how credit cards work, parents can go online with their children at sites such as in order help educate them about what factors to look at when comparing credit cards.  Parents and children can decide together what type of credit card is best for the student.

A student credit card is probably the most obvious choice, since these credit cards are designed for young consumers.  Student credit cards are a solid option for responsible young people who want to manage their own finances while building credit. 

Another option is for parents to add their child as an authorized user on their own credit card account.  This will enable the parent to monitor their child's monthly credit card spending.  Additionally, the credit limit on the overall account can help control the student's spending.        

The parent will be responsible for any debt their child accrues.  Of course, making sure their student understands the dangers of credit card debt is a good first line of defense.

For parents that are really concerned about credit card overspending and are willing to lay out the cash up front, a prepaid credit card only allows the card holder to spend the amount of money that has been loaded onto it in advance. 

With a prepaid card, parents can therefore control how much money gets loaded onto their child's plastic.  Just like with a debit card, there is no borrowing involved -- and therefore no debt.  

Simply put, parents should educate their children about credit cards.  By working together when it comes time to apply, parents and their children can choose the best option for the student.  

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Updated: 03-26-2019