She already has a checking account with a debit card. But should have a credit card as well. She will start college this fall.
Assume this summer?
Mine got one the summer before sophomore year of high school, for travel related reasons. We’ve never had an issue with inappropriate charges and it’s handy to be able to have her buy takeout while I grab groceries.
Ours were also on our credit cards in high school because they traveled on their own quite a bit. One general visa and a hotel visa so we got the points - only fair since we were paying for them.
She can also open her own college credit card with your bank and start building her own credit in college. These have a low limit, but it’s good to get something in their name. They can set it up to auto pay off balance each month.
I also gave my kids a credit card for my account when they were in HS. They used it for travel and gas for the car.
I agree with @CADREAMIN and (assuming she is fiscally responsible) would also suggest you get a card in her own name when she starts college to start building up a credit rating. My D got a student Discover card with a low debt limit which worked out very nicely – she still uses it as a young professional.
A secured credit card might work for her. Those normally have low limits, and are secured by a deposit of that value in a dedicated savings account. Happykid has one of those through her credit union. She likes having a low limit so she’s not tempted to overspend.
She also carries three more that are extensions of ours (first one from when she started college, the others later when planning an international trip where one or more might not be accepted), and puts big purchases on those when she needs back-up from Bank of Mom and Dad.
My kid has several of ours because I want to accumulate points/ cash back. A debit card is a waste in my opinion. I don’t want to lose out on all that free money. So she has our Amex Blue for groceries and gas (6 and 3 percent back respectively) And our chase sapphire reserve triple points on restaurants and hotels. When she was abroad the points really added up.
In addition she has our American Airlibes Executive card so she can go in the lounges when at an airport. She also has her own CC with a low limit that she got from the bank that has an affiliation with her university. She’s responsible for paying that one ( with our money). She puts any expenses on there where there is not a strong incentive for the other cards.
Your D needs to be careful with a debit card- credit cards have more fraud protection. Good idea for her to start building her own credit score. I wonder if her bank can allow most funds in a savings account to protect the funds but with easy transfers to checking. We have a Wells Fargo with linked checking/savings accounts.
My kids could and did drive to school starting freshman year - state law gives a permit for driving to school at age 14 if you are rural. When they got the car, they got a card on my regular credit card account for gas. They know that if they buy anything besides gas and a few other items that they either use their own money or call me before they use the card. So far no one has abused it except for maybe $10 or so every once in a while.
My D got on my gas card and one of my credit cards in high school. She was probably 15 at the time. She got her own credit card when she turned 18. Her credit card is for her own discretionary spending and mine is for emergencies and expenses I pay for (like co-pays, car stuff, etc.).
A student can easily get a Discover card with a $500 limit. Having a low limit might be a good thing BUT don’t charge more the 30% of the available credit.
My daughter did get one at the end of college and even though I told her not to charge more than $250, or to pay it immediately if she did, she didn’t listen to me. Her credit score kept bouncing from 630 to 695 to 700 to 640 all last year. It was her only payment except her car payment that had also just started. Now she has a higher limit, plus a second card, plus has started paying her student loan so her score has gone up in the last few cycles.
It’s not just making regular payments that helps the score but not using more than 30% of available credit With a low limit, some things can get you over that 30% quickly, like airplane tickets or a weekend vacation.
Card on parent’s account? I’m finding it useful now that she lives off campus and we support her living and want to keep track of expenses for 529 plan. We ask that only living and school expenses be used on the card, can add it up and pay ourselves back from 529 plan. When she lived in dorm, not necessary, only a few big bills, and some books. She uses her debit card for her own expenses and recreation.
My kids had my AmEx and Visa cards until they got their own (when they had a self supporting jobs). The AmEx Platinum gave them a lot of perks while traveling. When D1 started driving in high school I often asked her to do errands for me - picking up grocery, dry cleaning, driving her younger sister, so it was easy to give her my CCs that she could use.
My kids knew they couldn’t use my cards for large items without my knowledge. I’ve never had a problem with them. One benefit of putting them on my CCs was I was able to transfer my good credit to them. When they applied for CC themselves, both of them were able to get 15k+ limit even with new graduate salaries.
What’s up with all the multiple parent cards? My wife and I have used one household Visa card for 20+ years. Unlike Discover and Amex, Visa is accepted everywhere. Since I use it for business travel, it gets us a free airline companion pass every year and beaucoup miles. Am I missing out on something?
I like a lot of perks with AmEx platinum, especially their customer service. At the same time, when traveling to Europe AmEx is not always accepted. My Visa card has double points on certain purchases and AmEx also has on others. I feel my 2 cards kind of compliment each other.
@PossePops. For me it’s just a strategy to get the most bang for the buck on my biggest spending categories: groceries, restaurants and hotels. Getting 6 percent back on groceries is just too hard to pass up. And the Saphire Reserve card from chase 3 points on restaurants and hotels is the best points deal for us. You get another 50 percent in points when you redeem for travel and that too is among the best.
There are people with much more complicated points strategies ( look at The Points Guy website sometime) it’s like PhD level cc points strategy there, lol. We keep it relatively simple but it really has given us a lot of value. Of course we pay in full every month. And have taught our kids the importance of that.
Thanks. Makes sense. Back to the original post which caught my eye because drop off day for D19 is 8/23 and I was going to call the bank to discuss options. She’s very responsible so I was going to give her an authorized card from my account to keep pooling the points or get her her own card. The only downside to putting her on my account is the bill is 4 double-sided pages of 0.001 point type so I’ll never be able to ferret out any qualifying expenses. And I’m with @maya54. Pay in full every month.
I would suggest either getting a student Discover card or a secured credit card through your bank or credit union. Once my son graduated college he was unable to get an unsecured credit card even though he had a good paying job, no debt and had been an authorized user on ours for years. Fortunately he had $1000 in savings to back up the secured card and after a year he was approved for an unsecured card. He needed a credit card for work travel.
^ Thats odd. My D had a very high credit score from being an authorized user on my card and got a student credit card when she turned 18 with several thousand dollar limit. Kids should definitely get their own card during college.
My kids weren’t allowed to get their own credit cards until they were off my payroll. If I was paying for everything then they didn’t have the privilege of keeping their spends from me. It was a great incentive for them to be independent. I also wanted them to know a paycheck is necessary before they could have credit, not the other way around.
Our daughter has been an authorized user on one of our cards starting in junior year of HS (when she could drive). We expected her to be able to get her own, low limit card when she turned 18, but it was a no go from her bank. She’ll be able to get one once she starts her co-op.