I'm trying to help an 18 year old relative of mine establish credit. Aside from opening checking/savings accounts and making him an authorized user on an credit card account or two, what else can I do?
Just make sure to pick the right cards.
Your advice is even more important. Is he/she going to college and working at all?
What do you mean by right cards? All my cards are prime and I have a few retail cards. Yes, financial literacy is surely apart of the plan, thanks!
I'm helping my 19 yr old daughter start too. If he/she is working, have them try to get a secured card to start off. Mine got Cap 1, $49 deposit $200 limit. What I do is log in to the account and check due dates, making sure she's paying on time, etc. Her 3rd statement just cut and after 6 mos of history, she'll get a FICO. She recently got approved for NFCU unsecured $500 Visa, but I'm not letting her touch it for now. She also apped (without talking to me) for Kays, she got $400, but she's only to use $40 of it at a time, if at all. Once she shows responsibility with this, I'll help her grow. Once she gets to the point where she can get big girl cards, we'll prob close the secured, or try and pc to unsecured.
I agree Omni, in part. As an adult with credit difficulties now because of not learning right when I was her age, I'd much rather her learn with me in partial control. I think at 18, you still don't have the mentality that you do at 21 or 25. I'm going to be on her every credit move until I feel like she's good to go on her own. She's still learning and agreeable, so I think it's the best move a parent can make. This way, if she does make mistakes, I can help her learn from them quickly, as opposed to her not knowing what she did wrong and suffering for it later.