agree to a point- a debit card is needed many times- and now that zelle is such a big deal- you almost need it. But...unless someone is looking for cash back at a store, why in the world do people actually use it as debit and not credit
OT: Parents with kids going to or in college... Credit card?
- Thread starter RUBubba
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Well that’s a separate discussion.
You asked what highschooler’s use if they don’t have credit cards.
They’re using debit cards lol.
I don’t think I’ve ever used a debit card in my life for purchases anywhere. Only CCs and as long as you’re paying it off, you get the protections and the rewards.
One other suggestion which has kind of been mentioned is whether debit or credit is I get alerts for every transaction. I see the quick notification on my phone and I ignore it when I know it’s mine. But a couple times over the years I’ve had unauthorized use of CCs, no clue how, and I disputed the charges almost instantly and alerted the card company which took care of it and issued a new card.
The quicker you’re aware of any fraud, the quicker you can nip it in the bud and that’s especially important if you go the debit card route that is tied into a bank account.
Plenty of graduates spent the decade after graduation cleaning up the mess created by all of those fundraisers and promos. Each kid is different, but such easy access to credit isn’t necessarily a good thing.
When is a debit card needed much less “many times”. For those apps I started a separate bank account with like 500 bucks in it. Always afraid those apps get hacked and then 10 k is missing.
Outside of zell payments for some coaches gift etc I’m using Amex or check. Only way I ever use cash is if someone is doing me a favor like electrical work on the side etc.
I don’t spend a dollar that I can’t write off or get Amex points for.
if they know Mom/Dad will get an alert if their credit is pulled, they will not be applying for credit. Or maybe they will- but that is when Mom/Dad get tough and take the debit card and the shared CC away. lol
Credit history is huge though. Can't tell you how many of our son's teammates came out of school and into a multi year 8 figure contract and were shocked they couldnt get a conventional mortgage or car loan.
I’m old enough to remember when they did this with cigarettes too.
You’re focused on the costs but not the benefits. The majority will build a positive credit history, which will make it easier to rent an apartment, take out a car loan, or get a job which requires a credit check.
i remember when parents started to limit their kids to gas cards- not realizing they could be used in the gas station as well and in many states- you could get tobacco products, beer, condoms, food etc along with your gas purchase
I’m old enough to remember when I bought cigarettes using my Knight Express card and sold them for cash. A nice easy way to make it an ATM card.
I agree with you that it is also an equal opportunity to tech your kids good spending habits. We made it actually fun to see how much their credit would change in the positive each month
I can’t imagine using cash for any legal transaction. Last time I can remember using cash was for boxes for Super Bowl pool
Well that begs a question. 🙂
Anyway, I too virtually never use cash. I get cash back for using a CC so why use cash? Using a CC makes for a very easy audit trail. Using a CC provides a layer of security.
OTOH, I do have a couple things that get taken directly from a checking account where using a CC is either not an option or else it's an option for fees that are not insignificant. Property tax payments, for example. And I sometimes send funds by wire transfer or Zelle or the like. All those are more or less cash transactions.
But using actual cash in person? Almost never.
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With one brief exception, we didn't provide CCs to any of our kids at any point, HS or college. They either got their own, which two did once in college, as I recall, or they did without. The exception was that, when one of the kids spent a semester abroad, IIRC, we supplied that kid with a CC.
Having their own CCs helped them to build credit, as others have mentioned earlier in the thread. And to help them build even more credit, we had them use student loans for whatever portion of their undergraduate education wasn't covered by scholarships. And then we paid their loans off in full once they graduated, before any interest started kicking in.
It's funny with cash- a few years back when we were selling our house, we had a number of estate/garage sales- of course, everyone wants to come in with cash and offer so much less because something is $32 and they only have $10 cash left. Or, they wanted a big ticket item and came up with the, I don't carry that much cash on my- will you take this?
I was the typical, trying to see what additional cash they may have in their sock to get close to our very low asking price- my wife- "You have Zelle?, No, you have a bank account? I'll show you how to set it up" - of course almost everyone had it but tried to play dumb- my wife got almost full $$$ on everything...
This is still a good question for grad school kids. No job no credit card. I don't love the idea of giving my kid a card with my vacation level credit limit setting, which was all ours offered. Not because I don't trust them, but its an unnecessary risk if lost or stolen. I expect we will have to take out a new card with a lower limit to solve this to my comfort level. Kid seems a little particular about what card it is. Is an LLBean Mastercard not cool enough for kids these days at the bar? lol
Any suggestions for cards that young adults love to have appreciated.
Any suggestions for cards that young adults love to have appreciated.
I did all of those things in my early 20s without my own personal credit card in college and had absolutely no issues.
Something tells me there was nothing conventional about the mortgage or cars these kids were probably interested in.
That may also have something to do with why they couldn’t borrow the $….
Agree, no kid with an 8 figure contract is getting turned down for a car loan unless he’s buying a Maybach. I had not so great credit coming out of grad school because as suggested here, opened up cards in college to get dumb discounts. 10% off on Aeropostale. Sure. Why not. Never spent money on them but just having them dormant hurt your credit. Despite that never once got turned down for a car loan or mortgage.
What ever you do setup alerts so you can monitor how the card is being used.
My guys have had debit cards since they got jobs in high school. Going into sophomore year of college they wanted to start building credit and started looking for a credit card. It took them quite a while to find something with their limited income. I took it as a good sign of consumer protection laws against predatory lending. They did ultimately find a Visa card branded by Petal for students. Very low credit limit and they are very responsible. I’ve drilled them that a credit card is just for convenience and to get rewards, never to be used when you don’t have the money to pay the full balance.
Kind of important to remember your audience. That’s easy now. When I was in college in the 90’s my parents didn’t know what the internet was. Also context messages. We could have had 1000 credit cards and our parents would never know. Lol
This may not be a useful answer, but . . . when I was a first-year law student I was able to get a credit card. Wells Fargo (which hadn't gone over to the dark side in those days) ran a promotion saying it would give a credit card to anyone who scored high enough on their criteria. I think a score of 15 was needed. When I moved from a furnished to an unfurnished apartment in the middle of my first year, I had the minimum score needed. I think my credit line was $600. I used the card only for things like car repairs or furniture for the apartment. Being my parents' son, I never, never, let a balance go from month to month.
My wallet was stolen while in law school. I knew enough to report it to the credit card company and they sent me a new card without a problem. I didn't have autopay on anything, so the transition was easy. If I were the parent of a college age kid, I wouldn't worry about theft.
P.S. I have to add that at the time I knew a young woman ( a few years older than I) who ran up a huge balance. I ended up lending her money to pay it off and she cut up her cards. Plainly not everyone is responsible at that age.
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We're talking about teens and credit cards, not adults. How old are your kids and how responsible will each of them be individually with regards to money/spending etc when say they hit their teens and late teens? While it may seem like an easy answer when they are young, as kids get older you really never know. For instance my friend's kid put $1500 on his credit card in one night for on-line gaming purchases. Not quite sure how that could even happen - but it did.
My older son at RU has a credit card with a $3K limit. So far he's ok with it (for the most part) and pays his own bills out of summer jobs etc. However there is some minor slippage from time to time.
My youngest - no way I would give him access to a credit card - even with a moderate limit. Controlled, funded debit is the current way for him as he continues to learn financial responsibility and restraint.
I'm mixing cultural references, but...Good qualifier there. Here’s a pic of mild getting ready for the weekend.
I'm on a boat... I'm on a #&$^@*%%ing boat... 😀
I think your last sentence sums it up. “ Not everyone is responsible at that age.” If parents think their kid can handle a CC they should get one. If parents aren’t comfortable right now, don’t get one.
My daughter is starting her sophomore year at RU. She has a bank account, debit card (with BOA) and Zelle. She also has Apple Pay and Venmo. She has been very responsible with her money so far, and has been working at a store in New Brunswick so she has money to spend. I think in the next year she could get a CC with no issues and be responsible. 2 years of a CC instead of 4. Either way, all of these kids will figure it out as we all did when we were in college.
You're right that so much depends on the individual kid. I was the child of parents who came to maturity during the Depression and paid off their mortgage on a house they bought in 1951 in seven years. I have paid off my mortgage although arguably I shouldn't have.
Unfortunately, not all of these kids will figure it out before something bad happens. The woman I referred to was 24. There are people who never figure it out, which is why every credit card issuer has to expect that a percentage of cards will go into default. Last year, almost one-tenth of credit card balances "transitioned into delinquency." https://www.cnbc.com/2024/08/08/cre...inquencies-are-on-the-rise-reports-finds.html
All of this is correct- you are doing a few things as a parent- you teach and protect- you may have a kid that gets it day 1…you may have another great kid that doesn’t. Don’t throw a CC at both the same way.
But if you have that kid that gets it.,,build it for them
As I said, they all had cards by freshman year of HS. Think my son got his in 7th grade. You know you can out a cap on credit card spending right? I think my sons is 200 month. My senior in HS is like 500. College kid unlimited.
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