which is the 'best' 1st credit card?

annasdad · July 9, 2011, 4:31pm

I guess 18 minutes (1:35-1:53) meets some definitions of “right away,” but no matter.

Well, it is, unless the student promises never to use that credit card except in case of actual emergency and the student is trustworthy enough to comply. (No, jym, I’m not implying that your kids aren’t, or even that most kids aren’t.) Even if you pay it off when the statement comes, you’re in debt for that period. And the statistics clearly show that most kids (80%) don’t pay it off when the statement comes. You can throw all the rocks at me that you want, and you can say your kid is or will be one of the exceptions, and maybe s/he is or will be; but the fact is that most kids who get credit cards run balances, and in many cases, those balances are significant. Do you really think the credit card companies issue credit cards to people because they enjoy processing the charges, mailing out the statements, and providing the merchants with float? No - they issue credit cards to people because they know that most people will run balances and pay interest and that many will incur fees for late payments and overbalances. If an adult makes that decision, the blame’s on the adult’s head, as you’ve pointed out several times it was on mine. But I will not encourage my kids to step into the ring with Citibank et. al., because I know that Citibank usually wins.

annasdad · July 9, 2011, 4:33pm

Okay, fendergirl, I guess you know more about it than the LA County Department of Consumer Affairs does.

sunnyflorida · July 9, 2011, 4:37pm

My D turns 21 soon and this has been helpful. Thanks OP for asking. I believe the question was not whether to get a card, but which one might be a good one for a young adult who needs to establish credit. Sorry, but one eventually needs a card. One cannot rent a car with a debit card, nor can one guarantee a hotel room with one. Either it cannot be done, or it “locks up” the entire potential balance on your checking account, rendering it useless in the meantime. And there are reasons one should not always use their debit card online.

We have no credit card balances, and have taught our kids how NOT to use them. But a parent often has to let their kids learn by doing, not learn by controlling. I understand the attitude “buy now pay” later has put this county in a pickle. But the longer a parent refuses to let their 21+ yo establish some credit with a card, the more likely that kid might just go crazy charging once they are out from under the thumb of their parent.

If I have done my job, and if I have set a good example, than I can encourage my D to apply for a card and trust that she will use it wisely. If she does not, a lesson will be learned. That’s life.

annasdad · July 9, 2011, 4:38pm

I dunno - Google is your friend

sunnyflorida · July 9, 2011, 4:38pm

PS gotta love the ignore function of this site.

jym626 · July 9, 2011, 4:46pm

Annasdad- you seem to be intermingling responses to several posters (fendergirl, me and others) so its a bit hard to follow the bouncing ball. Again, some of the stats you are posting are dated, and household debt (whcih includes home, car, etc) is not the same as college student credit card debt. Sure its possible some of the debt is comingled, but it is not the same. And why, if you are anti-debt, would you suggest that someone take out a bankloan?

Why pay interest unnecessarily, even if it is paid back in a month. What is the point of such a loan? Having credit extended via a credit card makes perfect sense, as you (generically speaking) use just what you need an dno more. Taking out a bank loan unnecessarily, just to establish credit, sounds like poor fiscal judgment. Thats the kind of thing that causes people to get into debt. There is a big difference between havig credit extended vs taking on debt. A credit card does the former, a loan does the latter.

Understand why people who have had to learn the hard way, from past mistakes, to handle money responsibly might be defensive, testy and rude (eg expressions like NOYB is unecessarily rude). Thats what many are reacting to, IMO.

fendergirl · July 9, 2011, 4:56pm

I edited that part right away because I realized I forgot the apology, then afterwards (about 10 minutes later) realized I made a typo later in the response and went back and edited it a second time. Regardless, it’s in the past.

I do agree that credit card companies are in business to make money and they bank on the fact that people will carry balances and obviously most people do carry some sort of balance. I just don’t think you can equate getting a credit card to getting in credit card debt.

My last credit card statement had about xxxx on it. I guess I was in debt for that credit card period based on your usage of the word, but since I had well above the xxxx in my bank it’s a moot point because I have the means to pay that bill. (Gotta love those months where every little thing comes up all at once. that adds up!). If i had used my debit card for all of those charges it’s the same money out of my pocket (well, more money actually since I wouldn’t be getting xx dollars cash back for that statement period). Current statement has $xxx on it so far and will probably be around $xxx at the end of the period because I’ll have to get gas and groceries within the next week and a half. Using a credit card is basically to me borrowing their money for 0-4 weeks (Even though I don’t technically need to) and then paying them back in full at that point. It’s just so much more convenient and has great perks.

To me, debt is something that you don’t have the means to pay back at that exact moment. You could tell me that I have xk of student loan debt and I would be okay with that terminology. Even though I could technically pay it off, It only has a 1.9 percent interest rate so it’s not hurting me to pay it off overtime and leave that xk in my savings account for when issues arise. (Like when my sewer line breaks and i have to replace it. ouch!!!). You could say I’m in xxxk debt because of my mortgage and I’d be okay with that terminology as well.

Actually I’m going to edit this and take out the figures.

annasdad · July 9, 2011, 5:06pm

@jym

Those suggestions are not mine. I was asked by notredame for some information, and I found it for him, even though he could quite easily have found it for himself. If - BIG if - someone really takes out a credit card, charges stuff to it, and pays it off every month, that may be a better way to establish credit than some of those suggestions. But the facts are that most people, in spite of their intentions to pay off their balances every month, don’t. Among college students, that’s like 80% don’t. If you trust your S/D to be one of the 20%, that’s fine by me. But my advice remains: the best credit card is no credit card, especially for a young person.

For the record, I am not against debt for any purpose at all; I do have a mortgage.

And telling someone who asks for personal financial information in a public forum that it’s none of their business does not meet my definition of rude. Asking someone for that information in a public forum is very rude indeed.

jym626 · July 9, 2011, 5:16pm

Oh, I see you chose to edit your post too. What happened to your “sigh”?

Seriously, please go back and read the tone of your posts, and hopefully you can see why people are annoyed by the rude, offensive, abrasive tone. The attitude tends to come across as hostile, and those accessing their “ignore” button have the right idea.

If you quote someone elses suggestion, like taking out a bank loan (dumb idea, IMO) then it might help to quote the source.

annasdad · July 9, 2011, 5:19pm

If you’d read the full post, you would have seen that the link to the source immediately preceded the quote.

jym626 · July 9, 2011, 5:20pm

If you learn to use the quote function, or simply reference your content, you can make the posts easier to follow.

annasdad · July 9, 2011, 5:27pm

fendergirl had no trouble realizing that the text was a quote. Sorry that you did.

jym626 · July 9, 2011, 5:33pm

And you called her out on editing her post (making inaccurate assumptions about her reasons) yet you do the very same thing (e.g. edit your post to remove the snarky first part)? Please.

Back to the topic (PLEASE), There are several good choices for credit cards for students, and there have been several good threads about this where people share helpful information. Here is the most recent. <a href=“http://talk.collegeconfidential.com/parents-forum/1156077-student-credit-cards-capital-one-citibank-us-bank.html?highlight=bankrate[/url]”>http://talk.collegeconfidential.com/parents-forum/1156077-student-credit-cards-capital-one-citibank-us-bank.html?highlight=bankrate</a>

oldfort · July 9, 2011, 5:42pm

Not true, D1 was able to get Macy, Bloomingdale cards 2 years ago while in college, and I made her cancel all of them. She got them because they were having promotions with opening of credit card. She now has a real job, own apartment, and utilities in her own name, she is officially off my book, and she could open as many accts as she wants to.

I just checked her credit score, it’s above average , with no debt, lower due to lack of revolving credit. I don’t believe in the next few years she will need revolving credit.

I hope posters here don’t take it badly on what I am going to have to say here…A lot of kids who came from families with lesser means often become tempted to live beyond their means when they get to college. They see their friends with Mac, iPhone, designer bags and clothes, and the only way for them to have the same thing is to put it on credit. Those credit card companies will keep on increasing credit limit if card holder is able to make minimum payment every month.

As many of you know, D1 and I are very close, she tells me almost everything which goes on in her life, and that includes what her friends are doing. She has told me quite a few cases where her friends have bought very expensive things on their credit cards, and they hid it from their parents by changing billing address or use paperless statement.

Maturity level between age 18 vs 21 or 22 is very different. We may all like to believe a student at age 18 is an adult, but I see a big difference in D1 between 18 and 22. She is now more mature, has more self control, and has a much better appreciation of how much it takes to be self sufficient. She actually thanked us for providing her with all the nice stuff she’s had growing up, and she hope she could do the same for her kids someday. You guys all know your own kids as far as how much control they have, but I preferred to wait with my own.

D1&D2’s safety net - both of them have our premier AmEx on hand, it’s for emergency, and it allows them to get into airline lounges for free when they travel, concierge service if necessary, and medical air lift home from overseas.

annasdad · July 9, 2011, 5:47pm

@jym

My <sigh> was edited out within 30 seconds; fast enough so that CC doesn’t even consider it an edit. I regretted including it.</sigh>

You continue to ignore the facts and statistics I’ve posted and continue to want to make this about me. I’m done responding to your posts; go ahead and have the last word, if you wish.

jym626 · July 9, 2011, 5:50pm

Your points are well taken, oldfort. Also wonder if there is possibly a sex difference factor as well. Don’t have daughters so don’t know their spending habits. That said, when older s got his first credit card inhis own name as a college freshman, with a $4k limit, some of his friends wondered why he wasnt going out and buying toys (electronics). He was very responsible and told them he wasn’t interested in them, and that at the end of the month he’d have to pay for them. Wonder of others wanted him to buy them so they could play with them. No matter he said no. Smart kid, that one.

snowball · July 9, 2011, 5:51pm

I think teaching your student how to use a credit card is more important than which card to get. When I received my first credit card in college, I had no guidance. Being very independent, I probably wouldn’t have listened to my parents even if they try to tell me what to do. My husband and I were always very careful with our credit cards in college and grad school which provided us with great credit scores early in life. These high credit scores allowed us to purchase a home at an early age.

When our kids turned 16, they received a checking account and a credit card with their names on it, but on our account. As these were American Express card, when they were 21, I had them get their own AMEX card. AMEX counted their years of card holder service when approving them for their own cards. At 18 each child opened their own Visa card. My oldest also has a Master Card with BrandsMart that he opened when he bought a big screen tv. My youngest has a business credit card that she gets to keep the points earned on for herself.

With their first credit card, my kids were told bills had to be paid on time and in full. I would make sure they wrote the checks and mailed them at least 10 days in advance. Now they pay online, so they tend to wait to the last minute, but so does my husband I think my son has had one late fee, and my daughter had an overdraft on her checking account; I call these lessons learned and next time they won’t be so careless. It wouldn’t surprise me if the kids have better credit score than we do, and ours is excellent.

jym626 · July 9, 2011, 5:53pm

just because something is changed before the notation is made at the bottom of the post doesnt mean it isnt “considered” an edit. Really. but

Apology accepted :)

Thank heavens. Posters have been polite but evident in their annoyance with the continued rude tone. I remember too a similar tone in a thread about a girl dating her professor. That thread got closed. Lets hope that doesnt happen here.

Back to topic, please.

oldfort · July 9, 2011, 5:57pm

Boys buy electronics, and girls buy designer clothes and bags, but their spending habit (amount) are not that different.

FYI - in looking at D1’s credit report, our AmEx card in her name showed up on her credit report, with our balance. I don’t know how that’s factored into her credit score. It showed paid on time (by us, of course).

jym626 · July 9, 2011, 6:02pm

That is probably true, oldfort. Reminds me of a funny story. Several years ago some of the WII and PS2 games were really popular and hard to get. DS was trying to find out when a store was getting its shipment of “Rock Band” as he wanted to see if he could pay in advance (with his credit card!) and have it held for him to pick up. When he called, he must have had a bad connection, as he asked the person who answered the phone when they were expecting their shipment of “Rock Band” and if it had arrived. The sales person indignantly replied “sir, we do NOT sell that sort of thing in this store!!!”. My ds repeated slowly ** ROCK** Band… with an “R”. Not with a “C”. :eek:

which is the 'best' 1st credit card?

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