<p>Our 20 year old S is doing a poor job of handling a very low-credit-limit credit card. We keep telling him how important it is to pay on time, pay off balances when possible, etc. He gets very flustered and said he doesn’t need the credit card anyway, what’s the point, etc.</p>
<p>When we explain the value and importance of maintaining good credit on just one card for his future (ie, jobs, new apt leases, grad school loans), he shuts out all our good, hard-earned advice.</p>
<p>Any suggestions out there for a short, SIMPLE book that highlights some financial basics without getting into too much detail? He’s an avid reader so maybe hearing it from another source might have impact. A great pamphlet would be far more useful than a treatise, so some of the likely suspect recommendations may not fit here.</p>
<p>I realized how little he listens to us when he didn’t even understand that interest rate charges are charged only if you carry over balances.
Have we explained all this? Absolutely. It’s like speaking into the air…</p>
<p>Our kids did not want a credit card until a few months before graduation–just one thing too much. It doesn’t seem to have affected their ability to get an apartment any. I would suggest holding on to the credit card for him and helping him with one charge every few months, such as books. When he’s ready to learn, I’m sure he’ll manage. </p>
<p>^^ I’ve never read the above, but have read reviews. And I’ve Wish Listed it to give to DS upon graduation. He’s actually shown himself to be good with money so far, but there’s surely plenty he doesn’t know and potholes he might encounter.</p>
<p>Two books that are fun to read and demonstrate the value of saving early in life are “The Millionaire Next Door” and “The Wealthy Barber.” I do not remember if they directly address developing good credit (because they probably suggest minimizing oir doing away with credit cards), but they definitely address financial planning in an easy-to-understand way.</p>
<p>By the way, one of the interesting aspects of “The Millionaire Next Door” relevant to CC is that many of the parents who are frugal and hardworking (and become millionaires over their lifetimes) can afford to send their children to college and to enter the workforce in occupations that have peer pressure for higher spending than their parents. In other words, the children of many financially successful people have bad spending habits.</p>
<p>Thanks everyone for the links and book suggestions. I’ve looked at the Suze Orman book but don’t think S will get past the front cover. </p>
<p>Pafather, H has “The Millionaire Next Door”, but I’m not familiar with “The Wealthy Barber”. I’ll have to check it out. I really believe the statement you wrote “the children of many financially successful people have bad spending habits”. We’re doing ok financially but agree we didn’t do the best job with our kids.</p>
<p>dmd, I confess that I was the one who urged both our college kids to have a credit card. They are each over 500 miles from home and I felt it was an important emergency safety net for them to have. These days it seems very difficult to NOT have one–due to occasionally needing to order things online, airline tickets, etc. </p>
<p>I just want him to manage his measly $1000 limit better. D went through some ups and downs with hers, but she’s mostly been excellent at managing it. Interestingly, she has always been better at “details” and S not so much.
Guess that translates into minding deadlines, bill-paying, etc. Sigh.
Any more suggestions are welcome…thanks again.</p>
<p>My taste in books is always a little off center, but if your son is a reader he might enjoy The Richest Man in Babylon by George Clason. It is an old classic (first published in 1926 but still available in bookstores) based on pamphlets distributed by banks to encourage people to save. I used to give this book to my college summer interns as a parting present at the end of the summer. Each chapter is a stand-alone parable. It won’t help on the credit card per se, but good for encouraging savings and I thought it was a fun read.</p>
<p>[FatWallet</a> Forums - Finance -](<a href=“Earn Cash Back at stores you 💜”>Earn Cash Back at stores you 💜)
This site is populated by mostly younger males (some older) discussing what credit cards and rates, which CDs and why, which IRAs, HELOCs, student loans, saving vehicles, stocks/bonds, value of grad school degress and which ones, which cars and why, housing investments, real estate bubbles and on and on…
Would very likely appeal to your son!</p>
<p>[CreditBoards</a> (Powered by Invision Power Board)](<a href=“http://www.creditboards.com/forums/]CreditBoards”>http://www.creditboards.com/forums/)
The general site for all things credit and it does mean ALL things. Reading the newbie section for many, many hours will prove extremely helpful to anyone who has credit. And its changing importance in today’s economy.</p>
<p>Think of the site as a CC for credit.</p>
<p>[CreditBoards</a> -> Credit Forum](<a href=“http://creditboards.com/forums/index.php?showforum=2]CreditBoards”>http://creditboards.com/forums/index.php?showforum=2)
The is a sub-form that deals specifically with credit cards. Use this forum in conjunction with the top one. Especially OP for your son. It goes through all the steps in MANAGING your credit and the significance of poor credit behavior. There will be step by step instructions on all to pull all 4 credit reports and the meanings of all the notations and how to check your FICO score.</p>
<p>Also included is relevant information of the imminent change in the FICO scoring model and how it will impact new and young credit holders. Authorized users will no longer be figured in the FICO8 scoring model being rolled out by the 3 major credit reporting agencies. So establishing credit in their own name and RESPONSIBLY managing it will be crucial, much more so than it has in the past, specifically Jan 08 and beyond.</p>
<p>My 4 kiddos actually read those sites vs. never using CC except thru me!!</p>
<p>Kat
again think of these sites as the CC of credit</p>
<p>Curiouser, until my kids graduated, I had a joint account with them and they had a debit card on the account. I kept an eye on the accounts and consulted with them on expenditures. My daughter, unlikely as it sounds, actually was grumpy when I insisted it was time to get my name off the account. My son had asked me to stop looking at the account about a year before–and I mostly did.</p>
<p>The Visa debit card allowed them to do all the things a credit card allowed but with no ability to go beyond their actual cash. It doesn’t have the protections that a credit card has but they never had much money in there in any case.</p>
<p>I wasn’t in any rush to give my kids too much financial responsibility. Finances were and are an open topic for discussion. The last time I bought a car, I took my son with me so he could see how that worked, for example. When my daughter signed her lease, she asked me to take a look at it. My son did not–but he makes a lot more than my daughter.</p>
<p>(I also opened Roth IRAs for the kids when they started working. Try explaining to a 17-year-old that his Christmas present is a RETIREMENT FUND.)</p>
<p>We also fully fund the Roth IRA so the kids know that for every dollar they earn, they get $2 since we provide a dollar for dollar match. It’s a good way for them to see the magic of compounding.</p>
<p>This is a little beyond what you are asking, but my college junior D is considering taking a personal finance class online through a community college while she is off this summer. She tried to get one through the “community studies” arm of local state U, but it isn’t offered in the summer.</p>
<p>I was rereading the OP’s post and have a suggestion. What about cancelling the card as your son has requested? I can’t imagine not needing a credit card since I use it for everything from gas to groceries. Perhaps he will miss having a card more than he realizes. Since he isn’t responsible with the payments he must be charging something on there. Once he realizes he really does want/need a credit card, he might take ownership of it and suddenly become responsible.</p>
<p>This approach has some risk that he won’t be able to easily get another card when he wants it. Nevertheless, that can likely be overcome with a little effort and may also cause him to appreciate the value of developing a good credit history.</p>
<p>Just to give an alternative view of teaching money managment to kids:</p>
<p>I thought my parents did an excellent job so I try to use some of the things they did with my own kids. They were given a very small allowance starting in first grade. This was not linked to chores, but used as a money management tool. If they wanted to supplement this income, they were encouraged to do odd jobs not already required of them. We tried to keep them broke so they would develop a work ethic. I knew too many teenagers who would turn down odd jobs because apparently they didn’t need the money. They were encouraged, but not forced, to save first. They were not given a car, but encouraged to buy one from their savings. This taught them financial responsibility while we could still guide them (gas, maintenance, etc.)</p>
<p>They got a credit card with a very low limit at 16. I think a credit card is better than a debit card for teaching because once something is paid for with a debit card, it’s the same as using cash or checks. Whereas a credit card teaches them having to pay for something later which was enjoyed earlier (paying for a Big Mack in April which was eaten in March hurts) and having to remember to pay bills on time or pay a penalty.</p>
<p>These lessons should be learned while there is still some guidance, but they should be allowed to make mistakes. Purchases which you regret later and finance charges or late fees are the only way to learn about them. Especially when these are small mistakes.</p>
<p>The oldest two (28 & 25) own their own homes. They are starter homes that they work on, but they don’t have to pay rent. They have no credit card debt. The youngest (23) still lives at home, but he is in grad school and paying for it with his own earnings.</p>
<p>Books on the subject are great if you can get them to read them, but learning from example and being allowed to practice are the best teaching tools, IMHO.</p>
<p>I agree that the children of well off parents seem to have the hardest time. Maybe because these parents want to give their kids the best of everything.</p>
<p>I also agree that kids learn from example and experience. I can’t imagine a kid who isn’t interested in money to read a book about it.</p>
<p>3bm103…
He’s interested in money and in fact much more practical than his older sister.
However he doesn’t seem to listen very well to our advice. Often he thinks he understands something when in fact (surprise) he doesn’t at all.</p>
<p>He is an avid reader and researcher, appreciates the frugal side of life. It’s just that our words are falling on totally deaf ears here.</p>
<p>Thanks to EVERYONE for insight, links, and advice. I appreciate each of you for taking the time to post your thoughts.</p>