A credit card for children can be a great way to help build credit history. The process is simple. Just add your child as an authorized user online, and the company will ship the new card. It is becoming more common for kids to use credit cards. T.RowePrice has found that 17% percent of parents who have children aged 8-14 own a credit cards.
Greenlight
Greenlight is the perfect credit card for parents who are looking for a card to give their kids credit. The green card comes with zero foreign transaction fees, no ATM fees, and no card purchase fees. You also get features like allowance tracking and contactless payments. There is also a low $4.99 monthly fee. It helps children develop financial responsibility by attaching chores to allowances and rewards. You can check chores with the card and get notifications as soon as they're completed.
Parents can load money on their child's Greenlight card manually, or they can set up recurring transfers. The card can then automatically receive weekly allowances. You can also have your child's account set up by parents with parent-paid interest.
GoHenry
The GoHenry credit-card for kids was created with financial education in the mind. The card features include a customized debit card and an app that allows kids to set savings goals and manage spending. Parents can monitor their child's spending through the app, and the card is FDIC-insured. Parents can track spending trends and see the history of their child's purchases in real-time.
The GoHenry debit card for kids and Greenlight credit card for teens both come with tools designed to teach kids financial responsibility. For instance, the app features colorful budgeting tools and a chore tracker that adds money to the card for household chores completed. 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 cards for children are a great way to introduce kids to credit. The card has a number of features including spending limits and the ability for you to create 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 create family sharing groups to track spending and set spending limits. Parents can invite up five people to their card to build credit and share it with them. Each user must be at the least 13 years of age and agree to pay for all spending. The activity is shared with credit bureaus and both owners are responsible to pay.
Secured Credit Cards
Although secured credit cards can be a great way to build credit history for your child, there are some things that you need to remember before you allow them to use one. The first is that secured credit cards are extremely expensive and have high interest rate. Additionally, transactions above a certain limit will result in a fee. The downside to a secured account is the inability to transfer funds between cards. A card that allows spending limits to be set and can be changed at will is a better choice. Your child shouldn't have a high-limit card and then discover that he/she cannot pay it back.
Secured credit cards for kids can teach your child how to manage money and prevent over-limit charges. These cards can also help children build credit history and teach them about credit limits. It is a good idea that they start young to help avoid major credit card mistakes later.