 TITLE: When Is the Best Time to Give My Kid a Credit Card? CONTENT: What Should My Kids Know ing Credit Cards?\n--------------------------------------------------\nWhile credit cards sometimes get a bad rap, usually from stories of folks who become mired in high interest credit card debt, they are actually useful financial tools. When used responsibly, they help you establish and build credit, which makes it easier to qualify for other forms of loans and credit in the future, such as a car loan or mortgage.\nYour children may not be prepared to get their own credit card until college, but it's never too early to start teaching them about the ins and outs of credit.\n### Benefits of Credit Cards\n*   Credit cards are often the first way a person begins to establish and build credit history. Whenever you open a credit card, it goes on your credit report, which also tracks your balance and repayment history. This is important because your credit report will be used by lenders and others to determine whether you are financially responsible.\n*   When a credit card user makes responsible choices, such as keeping their credit utilization rate low and paying bills on time, this can help build a good credit history and high credit scores. These are typically necessary to qualify for other means of credit later in life, such as a car loan, mortgage or even financing for a smartphone. Credit is also sometimes checked when you apply for a job or an apartment to assess your financial responsibility.\n### Downsides of Credit Cards\n*   While your income is a factor in what credit limit you're given, it's still possible to use credit cards to spend more than you can afford to pay off every month. Kids should know that credit cards aren't meant to be a way to purchase what you can't afford and live beyond your means, but rather as a short-term loan for emergencies or credit-building purposes that they must repay as quickly as possible to maintain good credit.\n*   Credit cards don't lend you money for free. While some do offer 0% introductory rates, they don't last forever; other credit cards have steep interest rates from the start. Kids should learn that interest is the price paid to borrow money, and high interest rates make debt even more expensive and difficult to pay off.\n*   While smart credit card use can help build and improve your credit, being irresponsible with plastic can tank your credit. Your child should know that if they make late payments, their credit will suffer; and if they default on a debt, it can go to collections and seriously damage their credit for years to come. END