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Personal Finances / Credit Cards and Consumer Debt


Subject:  Re: Credit for College Date:  1/11/2019  9:23 AM
Author:  2gifts Number:  312325 of 312777

I disagree with the other 2 posters on making her an authorized user on one of your cards. First, it is my understanding that being an authorized user does not impact her credit score (but I could be mistaken on that). Second, and more importantly, I don't see how that does anything to help her learn how to actually use and manage a credit card.

If you belong to a local credit union, see if they will give her a card that you co-sign for her to use. My credit union lets kids have a co-signed credit card at 17, and so I got each of them a card at that time. Since they were still in high school, they used the card for gas (for which they were responsible) and any other incidentals that they had. The bills came here, and I could help them to check them over for errors, and ensure that they then paid the bills. This was a great teaching tool for them as they were heading off to college and independence to learn how to use a card responsibly.

At the suggestion of another poster here, I had my kids keep those cards after they graduated college. An interesting thing with my credit union is that they do not automatically increase credit lines, and so here we are 10 years later, and they each still have these cards and they still have a $1000 limit.

I've done this for a few reasons. DD still lives with us, so if I want her to stop at the grocery store on the way home and pick something up or buy something else for me, I have her put it on that card, and then I can just go in and pay it off. DS is over an hour away down in RI, and for him, I tell him to use it for some expense that we want to pick up. For instance, we gave him a new iPhone for his birthday last year because his phone (iPhone 4) died about a month before his birthday. It was easiest just to have him go get a new one that we wanted to buy, and just put it on the card. If we don't see him for his birthday, I have been known to tell him to take himself and a friend out for dinner, and put that on the card.

So they've kept the card, which is their oldest, to be convenient for me.

I know that DD's credit score is over 800.

But if you just give your daughter your card, she will not have as much of an opportunity to learn how to manage her spending and learn to pay the bill. I think you need to be thinking much longer term.

P.S. In college, I told them the card was to be used in an emergency which I defined as "you'd walk across the street naked". DS called me one day to say that he had used the car in what he thought was an emergency since he'd fallen and they thought he broke his arm (thankfully not). Then we had the conversation about how if you are in a place whose name stars with "emergency", it's a pretty safe bet that you can and should be using that card.
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