We met with our banker during S1’s senior year. He advised S1 to put one to the apartment utilities in his name to establish credit. (check with your bank as to which utilities help with credit. I think S did heat).
When we got our first credit card it was a department store card. It seemed easier to get, but beware the interest rates might be 20% or higher, so not for carrying a balance.
I added my D to one of my cards when she turned 18. When she is a bit older and works she should be able to get her own CC. Some Credit Unions offer secured CC that work with a savings account. Good for young people establishing credit. They also have very good rates for car loans.
My son got a credit card through USAA - he has his 529, roth and checking and savings with them. We just got it for him this summer and this senior year we’re teaching him how to manage it responsibly…use it to no more than 30% and pay it monthly before the whopping 25% interest rate hits. Basically instead of using his debit card he’s using this cc and paying it off at the end of the month. Once a year he’ll get 1.9% back.
AmEx ask for authorized user’s SS#, and Visa/Master do not. When I look at my D’s credit report, I see AmEx on her report, but not Visa.
@oldfort it depends on the visa issuer. My visa appears on my daughters report.
@partyof5 do you remember if you gave your D’s SS #?
@oldfort I am pretty sure I did.
Since we are on the subject…Make sure you notify your cc company if your kid is traveling to another state. My daughter just arrived in NYC and tried to use my card and it was declined. It did not occur to me to call the bank to tell them she would be out of the area, because heck she is out of our home area during the school year at college! Thank goodness I was in front of the computer, and was able to transfer some money to her checking account, so she used her debit card. I know the bank was just doing its job, but it was annoying as heck.
I looked into all the option mentioned in the thread. Not much luck so far. Getting a secured card seems the only option unless we wait until next year. Thank you all for suggestions.
^^Congress changed the law a few years ago restricting credit cards from college kids unless they have ‘income’…
My youngest son had no problem getting a credit card through his bank (Wells Fargo) when he opened a checking account with them when he was an incoming college freshman. We also have him as an authorized user for two of our credit cards. We did that because he went to college OOS and it just made it simpler when he traveled home - could put gas on it, train/plane/bus tickets, occasional haircut. We had not done that with our oldest but should have. We were forever reimbursing her and missing the mileage on the card we could have gotten if she had just charged it. And, because of that lack of credit, when she graduated college she had no credit record at all and had to start with the crappy Capitol one credit card with a $200 limit. She couldn’t even use it for a plane ticket. About a year after she graduated I added her to my Costco account, and as an authorized user she got an AmEx card. Now, she didn’t use the card at all but my credit DID count towards her and helped when she went to rent an apartment later.
My older son found that by having him as an authorized user on one of our cards also helped his credit score.
My sons got credit cards, with my name attached, at Our credit union. They each have their card, and used their ssn, but I guess I’m kind of like a co-signer. The limit is $2k on each card, because that’s what I requested.
Happykid got a secured card at her credit union. It was a quick and easy application. I’d recommend that you start with your own bank or credit union.
My daughter got a Discover card the summer before her freshman year. Started with a $300 limit. Paid directly from her savings account. She has worked since she was 14 and has a part time job now at school. She has been very responsible with it.
D got her Costco AmEx card one day when we were there shopping and she was trying to help out the guy who was trying to get folks to sign up. She had no ID, but was with us. She was still a recent college grad and had no income but was told she could say her income was room and board we paid on her behalf. She got a card, immediately approved at the store by phone, with a 4 figure credit limit which is more than she’s ever needed to charge to date.
Income is part of the approval process but not part of a CREDIT score. The best odds are to start with keeping a bank account and have a secondary card with the parents. The ensuing credit score is helped by this but it is incorrect that the parental credit score becomes the student’s. The kid’s score might be high because the credit utilization MIGHT be low. The credit score is individual and is based on multiple factors including number of accounts, age of accounts, and variety of credit.
As always, the credit score is only ONE part of obtaining a credit card. The limit will be defined by performance and … Usage. The more one uses it, the higher the limit. I had a CC in high school that was individual that started at 500 dollars. In college, it reached well over 15,000 through regular charges. One caveat … in the crisis days, the interest rates jumped to a silly level. It was not that important as I did not carry large balances or paid in full. It took years to revert to a reasonable rate and required asking for a lower rate.
Cards that include substantial benefits are hard to obtain in the early going.
Also, it would be helpful to the OP if folks put the year their kid GOT a student card. A lot has changed in terms of credit cards for students in the last five years. Many banks that offered a credit card as part of the college account package no longer do so.
Both of my kids had no trouble getting student accounts with credit cards, and no monthly fees with Bank of America (and NO I do not recommend them…at all) in 2003 and 2007. The type of account they have is no longer offered.
I think we are waiting till next year. My D may be able to get a secured card through her bank. But her bank issues mastercards. One of her favorite shops makes a point of not accepting master cards. No idea why.
My kid just got her Bank of America credit card either late 2014 or early 2015. She has a job but has not held the job for more than 6 months. She has savings and checking with Bank of America. I don’t think she pays any fees either.
My kid still has her B of A accounts. For no fees, she has to now keep $1500 in her savings. Otherwise, she pays fees for just about everything including using a teller at the bank. Hers was a student account established 2006.
My son has the same thing…but he has to keep less in his account…but I’m guessing that will be changing.
Bank of America is restructuring all of the fees schedules for their account holders.