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Wyandotte, Mich. — October 26, 2023 – When it comes to teens and credit cards, is there a perfect age to offer such financial responsibility? Carma Peters, president and CEO of Michigan Legacy Credit Union, notes that when a teen starts to travel, work, or drive, they may need emergency access to funds, so it’s often a good time to start.
“A credit or debit card for a teen can be as much a convenience to the parent as it is the teen,” Peters said. “The best age can depend on a child’s maturity level in decision making, but at age 14 or 15, teens are entering high school and spending more time away from their parents when purchasing decisions are made.”
Peters offers parents some background for dealing with teens and money:
- If opting for a credit card, the child’s name can be on the card – but an adult is required to be on a credit card account for a minor until they turn 18.
- Set a reasonable financial limit on the child’s access to credit, if the account allows a differing amount for ‘family’ credit cards.
- Consider turning on transaction alerts to be on the lookout for unauthorized transactions or to monitor the teen’s spending.
- If a teen is given a debit card, ensure there is money in the account to cover the agreed upon expenses.
- Setting expectations and educating your teen is the best way to ensure they have great credit their entire lives.
Peters notes that unless a parent and dependent share a joint bank account, the credit score of the main card holder does not transfer to the dependent.
When considering mobile payment methods like Venmo or Zelle, especially with younger generations, Peters says similar guidelines apply, adding new cautions.
“Everyone needs to be cautious when using Venmo and other apps like Cash App. Sharing purchasing information on social media platforms can tell a predator a lot about you, including how much money you spend, where you shop, dine, and other personal patterns that can tip a predator off as to where you might be found offline,” Peters said.
About Michigan Legacy Credit Union
Michigan Legacy Credit Union (MLCU) is a member-owned, not-for-profit financial cooperative serving members who live, work, worship, attend school, or own a business in the state of Michigan. Michigan Legacy Credit Union is committed to providing quality financial services at a competitive price, delivered professionally and efficiently while keeping member/owners and their needs first. For additional information on MLCU, visit: www.michiganlegacycu.org.