05.18.08
A VISA Card for Teens?
Friday, I received an email offering a VISA card for teens http://www.upsideclear.com/LearnMore.aspx. The thought of my 14 year old with his own credit card is pretty scary. He can barely remember to wait for his change at the pizza shop, imagine the responsibility of his own credit card!
I remember my first credit card at age 18; it was for Lord & Taylor. When I was a teen without any credit history, the easiest cards to qualify for were department stores. Usually you started with a few hundred dollars in credit so you couldn’t do too much damage but a few hundred on each card could really begin to add up every month. I had a job and I made sure I always paid my bills on time every month. After a while I was able to develop decent credit and that’s when the VISA solicitations started to arrive in my mailbox. VISA was the be all and end all; imagine, you could use one card everywhere! Well, I guess it’s not hard to predict but within a short amount of time I fell into the credit card debt trap and found myself paying off $1k across all of my cards. After roughly a year of pretty strict budgeting, I also realized minimum payments don’t get you anywhere but in a spiral!
The UPside Clear VISA card is debt free. There’s no credit line; it’s prepaid and is in your child’s name. It’s a bit like a VISA gift card but has no fees and can be reloaded online or by phone. There is no need to go back to the store that it was purchased to reload. Your child sets up an online registration and is responsible for monitoring the spending and checking the balance. You can set up a re-load schedule based on weekly allowance if you like.
As with most other parents I’m trying to teach my children by learning from my own mistakes. I don’t know, but a 14 year old carrying plastic still doesn’t sit right with me and I’m not sure that attempting to charge $22 on a $20 prepaid card is much different than trying to spend $22 in cash when there is only a $20 in your wallet. Does a prepaid card give your child more control? Do you think having a prepaid card could save your child from future credit card debt? Or could it work in reverse? I’m still not sure where I fall on this one but I’d love to hear your thoughts.
Stumble it!
Dad of 3 said,
May 18, 2008 at 4:05 pm
well I understand the logic but what message are we sending them? The country is at 80% in credit card debt. Allowing kids to use credit cards enables this further
emily said,
May 18, 2008 at 4:12 pm
I totally agree with the dad of 3. Its hard enough to pay debts without the use of credit cards for kids.
beth said,
May 18, 2008 at 5:02 pm
I kinda disagree with Dad of 3. I think in the future everything will be paid by some sort of card or your cell phone (like in Japan). Who wants to have to carry around cash? I see it simply as a cash alternative, and I don’t see anything wrong with that. You just have to make sure VISA isn’t doing too much marketing to him, as that is what they are trying to do there– hook ‘em young.
Laura said,
May 19, 2008 at 10:51 am
I think it is a little early for a 14 yr old to have a credit card even if it is prepaid…..why are we rushing to have our young ones grow up so fast?
Amy said,
May 21, 2008 at 11:16 am
I read in a recent study that people will spend more if they pay in plastic versus cash because there is less mental inhibition with using plastic. So, giving an average person a $100 VISA card or $100 in cash and the likelihood is that he/she will spend the $100 on the VISA sooner than the $100 cash. Given that, I would make sure to establish strong financial responsibilty in a child before introducing plastic.
Dad Of Three said,
May 24, 2008 at 7:17 am
Thanks for all your input. My point is as Laura puts it why are we rushing to have our kids all grown up? What happened to simple childhood? I remember growing up, having fond memories then all of a sudden you’re and adult with adult responsibility. I say let the kids be kids as long as they can.
Grandpa of 5 said,
May 24, 2008 at 7:20 am
I have rasied my children to be fine young adults, I am seeing my grandchildren mature. It happening in the blink of an eye. Whats the rush as Dad Of Three puts it. I agree
Valerie said,
May 30, 2008 at 3:37 pm
I am not really fond of the idea of a credit card for kids, but there is an upside to this kind of a prepaid credit card. The child will not be carrying cash, which means that if he or she gets robbed (or loses a wallet or pocketbook) you can call Visa and stop the card. The safety issue may be something to think about.
Claudia said,
June 2, 2008 at 10:07 am
I don’t see how paying with plastic wil teach kids more about money management than paying with cash, in fact, i think that when people use plastic they lose the immediate connection with money and it almost doesn’t feel like they’re “spending” with a credit or debit card. 14 years old is too young, in my opinion. Parents should decide when or if their kids are ready for credit, not the credit card companies.
Glenniss said,
July 23, 2008 at 1:32 pm
I currently don’t have kids however, speaking from experience when I was 15 my Dad gave me my first Credit Card with a $300 limit. My parents stressed that the card was for emergencies. Well my first time around Macy’s, and Old Navy was an emergency :). I was grounded for about a week and had to work on paying the credit card off with my own money. This was definitely a lesson learned. From there I made it a point to use the card for exactly what it was meant for, sometimes buying myself food or paying for sometime my parents gave me permission to buy.
With that said, I think a credit card would be a great way of helping a teen to realize the concept of Credit. Whatever you buy you must pay for it later, within a reasonable timeframe!
I think the pre-paid credit card is a great idea as a starter. Their allowance and any other money they earn can go onto the credit card. When all funds are used they will know its time to add more money. Also this should teach them how to montior their funds continousily checking the balance and confirming all purchases based on their receipts.
CreditMom said,
July 23, 2008 at 3:25 pm
Wow…15. I’m not letting my 14 year old read this. I think it depends on the child. Right now, it’s a good day when he remembers to leave the house with his wallet and his clothes are all in tact. I like the fact that your parents didn’t bail you out. It’s good that you were taught a lesson and paying interest charges is a great lesson as well. Also, putting a limit on the card was a great idea so you couldn’t go too crazy clothes shopping.