Son is new to credit - looking for advice on starting him right

[Anonymous]

My son is turning 18 next month.  He has a part time job and is going to school.  I am thinking of making him an authorized user on my Exxon Mobile gas card and also on my one credit card that has a limit of 3500.  As he has absolutely no credit as he is young I am wondering if this will help him instead of him getting or trying to get his own credit card in the summer time.  I want him to do what is going to be the best for him credit wise.  thanks.

Message Edited by llecs on 03-09-2009 03:10 PM

[llecs]

LYNNY47, I split off your post to form a new one here. I did not change your post at all, but I did have to edit the subject line. If you'd like to change it to something else, feel free to click on "Options" then "Edit Message" to change that.

To comment, it would depend on your and his goals I suppose. I remember being in college and my folks never helped or offered me credit. I had to do it on my own. Everything turned out fine and got a Citi and Discover acct right away, except that I lacked responsibility and opted to have fun on the weekends rather than pay my CC bills. So things turned ugly real quick. But that was my mistake and I learned well from it.

Message Edited by llecs on 03-09-2009 03:15 PM

[tmariecus]

Dont do it, unless you are going to be responsible for his mistakes.  You're score could even drop!

He is 18, I would talk to him about credit, and have him do it on his own.  Send him links to these sites.  He is an adult and needs to take care of himself.

[elaine829]

I would start with the bank he has a checking account and savings account with. I have two daughters 18 year old and 19 year old they didnt have credit but they had jobs and we got they're first credit card with our bank. i couldnt believe that they started them with 2, 000 credit limit. But both of them still stay at home and i talk to them about not messing up their credit. Also a credit union is a choice maybe go into one and ask. 

Message Edited by elaine829 on 03-09-2009 01:23 PM

[Anonymous]

I would not AU him on cards.  Let him start small and work his way up.  If you AU him on cards and his history/score gets too high too quick he may end up with a bunch of offers fo high limit cards and find himslef quickly in trouble.  It is easy enough for a college age kid with a job to get one or two small cards and build from there.  Also, it limits your liability and teaches him better money skills.  The key is to not jump start their credit, but to talk to them about proper credit handling.

Another option is to start them with a secured credit card right away so they can not exceed the balance or rack up major debt while learning how to handle the debt. 

[elaine829]

You dont have to add him to your credit cards just go to the bank that have his checking or savings account  and ask them if they have any credit cards with someone starting off. Both my daughters have their own credit cards without me. I dont know what state you live in but commerce bank in missouri have credit cards for 18 years old starting off. I was shock they started their limit so high 2,000 credit limit. But they both still live at home and i kind of guide them with their usage of the credit card.

[Anonymous]

My son is going to be 17 tomorrow and we opened a checking account at my CU for him. A week later they sent a letter offering him a $500 credit limit card. I have to sign off but is assures me that I will not be responsible. I have thought about this, and will probably let him do it, but it is set up that I monitor everything. I have already showed him credit card debt calculators, he just wants to use it to build credit for down the line. Scary in some ways, but I am confident I can guide him down the right path.

[elaine829]

 hi, Im surprise that the cu is giving your son a credit card if he's 17 years old because he's still a minor. Are you sure you wont be responsible for the credit card? I remember when my oldest daughter was seventeen she went to macys and they offered her a credit card and got one. at the time i called macys and told them that she was a minor and closed it. They continue to keep it open until i told them that a lawyer told me minors cannot enter into contract so she couldnt be liable for the charges.Thats all it took. They closed the acct and took it off her credit and sent me a letter stating that they was taking it off.  I was not thinking about her credit then i wish we would have kept it open. But since hes still at home you can monitor it.

Message Edited by elaine829 on 03-11-2009 01:31 PM

[Anonymous]

Teach him the wisdom of low utilization, it's the number one way to conteract the tendency for young people to see a credit line as free money

[Anonymous]

IMO you are correct in adding him as an *AU*. This starts his credit file and when he has a job and some savings then he can apply for a CC in his name.

I stsrted my sons as an AU to 2 of my CCs when they were 16. At age 18 they received offers from these CCC and then just applied to who they wanted.

As an AU they can use the CC and I made them pay me every month. This way they get into the habit of must pay every month.