Day by day American kids watch how their parents put some cute little thing into an automated teller machine and... as if by magic they get a bundle of cash. It's a complicated task for little kids to understand the principle of credit card processing. Looking back at our childhood, we recall some funny moments concerning money matters. Now we find them ridiculous and stupid, but at that time we had another point of view. The question is: How to teach your child about plastics? And what should children know before their first credit card application?
Sooner or later for all parents it becomes difficult to do shopping with their little ones. The very process of getting something for green papers or a little plastic card seems so simple, that kids cannot help but wonder, "Why can't I get this toy?"
As a rule, parents don't think it's appropriate to talk with their children about money. Small wonder that children have no idea about the value of money and things like that. That's why they think so primitively about the matters that so important in our life. Specialists recommend teaching your kid about credit cards and money. It would be much better if you clear up all the peculiarities of credit card processing before his first credit card application.
By all means the age of your kid does matter. But believe me it's quite possible to explain everything in simple terms. For example, do shopping together with your little one. Try to involve him or her in this activity and I'm sure it will be fascinating for your child and you. When you need to pay, allow the kid to swipe a plastic for you. Take this opportunity to tell him how credit cards work. Mention the fact that you must pay back for everything you have bought.
I'm convinced that teens have also certain questions concerning credit cards. Maybe they know the general principle of plastics functioning, but it's definitely not enough for their future. Some parents think, "No credit card - no difficulties for my child". It's a big mistake! When your child enters the college and apply for one of those student cards, he or she will probably face a lot of unexpected difficulties. If you really want to help your son or daughter, take experts' opinion into consideration.
First of all, try to be a good example for your children. Have no doubt your kids adopt your financial practices. If yours leave much to be desired, no way to expect credit responsibility from your dear kid.
Practice makes perfect. For instance, you may add your child to your account. To be on a safe side set certain rules, like "You can spend $300 a month, if you spend more pay this sum out of your pocket money." It's also a good idea to analyze bill statements together. This way your kid will get the notion of credit card details.
If you consider your children old enough, offer to start them out with secured credit cards. Once these cards secured by money, there's no way to spend more and get into debts. Besides, these plastics feel like ordinary credit cards, for they have the same sphere of use.
By all means, it would be nice for your children to obtain their first plastics before they leave home. This way they can get sound advice concerning first application for a credit card and you can be sure that they won't make foolish mistakes afterwards. So, your kid will know the real price of luring credit card ads.