Having a credit card is a big responsibility. The way you manage credit can greatly influence your credit score, which impacts whether you qualify for loans. Given the level of responsibility, you may hesitate giving your teenager a credit card. Teenagers often shop frivolously and this behavior increases their risk of debt. To avoid debt problems, you might suggest a prepaid card. These cards teach budgeting and self-control, but they are not necessarily the best credit cards for teens.
A prepaid credit card is a type of debit card VCC buy. These cards do not build credit because teens can only spend what they deposit on the card. An actual credit card in your teen’s name can help him or her establish credit at an early age. If you are searching and comparing the best cards for teens, here are five options
Bad credit ratings are no friend to loan applicants, but they are equally damaging to the chances of securing credit card approval. But that is not to say bad credit borrowers have no credit card options open to them. In fact, there are unsecured credit cards for bad credit borrowers, and tailored to suit their needs.
Remember that card issuers would prefer to approve an application than reject it, since only issued cards can lead to profits. But it is also true that they have policies that are strictly adhered to. So, getting approval despite bad credit requires some planning and effort, and come at the cost of compromises like high interest rates, for example.
Before ever seeking a credit card, it is important to understand exactly where the costs lie and how expensive the card might prove to be. After all, it is the costs associated with an unsecured credit card that makes it potentially so expensive.
Many of our fears are often perpetuated by myths, things that aren’t even true. Sometimes the truth is obvious, while at other times it’s more suppressed. This is why it is important to continually educate one’s self in order to distinguish the myths from the truths.
When it comes to finances and credit, there are a lot of myths floating around. Some myths are so common that people accept them as truth. I remember my 1st year heading into college my grandmother told me in short, “don’t get a credit card, they are bad” (well, that was informative). So naturally without any real explanation or understanding of what she meant, I got my first credit card two months after. As a matter of fact, I got a free slice of pizza just for applying, and at the time for a broke college student like myself, I just came up. Fast forward several years with some reflection, I realized there was little truth in her statement; she failed to educate me on how to manage credit and using the credit card as a financial benefit. Let’s be clear, it would not be fair to blame my grandmother for my financial suffering. One cannot teach what one does not know, this is why proper education is of the utmost importance.
While there are tons of myths involving finances, this is an all-time common one. The thought of that evil little plastic thing ruining your life seems so real. But reality is a credit card is an object, it can’t do anything. The person possessing the credit card determines the value it holds in one’s life.
At birth you are given a social security number which is the first most important thing you will receive (and all this time you thought it was your name). These digits are your unique identity and will be used to keep track of all financial activities. These activities will be rated through what is known as the credit report. Experian, Equifax and TransUnion are the 3 credit bureaus that provide reports.
The word credit simply refers to the supplying of money, goods, or services with the expectation of future payment. Before the age of 18 you will have a status of “no credit” (referring to having no record of borrowing); however, there are ways one could end up with reporting’s before the age of 18, but we are not going to discuss that. The legal age that you can apply for credit is 18, whether it is a credit card or a loan. Typically, the first run in people have with credit is the credit card. Why is this? This is the easiest form of credit to obtain. People will often use a credit card as a first start to establishing creditability in order to have borrowing power for future larger credit needs, such as a home loan or car loan.
While the credit card is the easiest stepping-stone, it’s also the quickest fall for millions of people. So how does this seemingly innocent thing destroy people’s lives? If used improperly or excessively, it can drown one in unmanageable amounts of debt. While some people genuinely have no control with credit cards, I feel most people don’t understand the credit card and that’s where the long term problems arise. Lets look at the key things to know and remember about the credit card: