Credit Cards For Teenagers

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Improve Bad Credit with Credit Cards
A habitual delay or missing payment for the money loaned would hurt credit rating badly. This usually happens with people who has committed the mistake in managing their finances.

Having bad credit history would mean keeping you from the ability to make loans for home or car mortgages, rent an apartment and even prevent an individual from getting hired. This is because many employers vi... Read credit cards article



Zero APR Balance Transfer Credit Cards
There is a lot of interest in 0% APR Balance Transfer credit cards because of the tremendous savings possibilities they offer. You don't have to be an MIT graduate to understand that the 20% you are paying to a high-interest credit card on a balance of $ 10,000.00 is two grand; and if the interest on your credit card was 0% APR, that money would stay in your pocket. It turns out, however, that not... Read credit cards article



Credit Cards For Teenagers
People have to start their financial learning at some point in their lives, and this usually starts when they are children or young teenagers. But what sort of financial products are good for teenagers, if anything at all? One on hand you need to teach them the value of money, but on the other hand they need some form of card or cash in order to start being independent. If you are unsure what type is right for your children, then here is some advice on credit cards for teenagers.

Stay away from normal credit

If you have a child, then you should really stay away from traditional credit cards, because these types of cards do not promote responsible spending. Although a credit card would allow a child to make mistakes about spending and learn from them, simply giving them a line of credit will probably end in disaster. You have no way of stopping them from spending the whole limit in one go, and they are putting you and themselves in debt.

Prepaid cards

Despite normal credit cards being a bad idea, there is a new type of card on the market that is being targeted at children. These cards are known as prepaid cards, and have most of the facilities of a credit card; except that you put money on the card in the same way you put money on a mobile phone. Instead of giving your child a credit card, you can put a certain amount of money on the card each week or month and then the child can use the card as they see fit.

Benefits of prepaid cards

The main benefit of a prepaid card is that it combines the freedom of having a card with the ability to control spending. This makes it ideal for parents who want to give their children a level of financial responsibility but still have the means to control the amount they spend and on what. By having a card with a statement, the parent can see exactly what their child is spending their money on and when. This is a very useful tool in helping to educate children on money expenditure. Also, prepaid cards are safer than having your child carry around cash, plus it also allows them to make purchases online.

Drawbacks of prepaid cards

Although many believe these cards are better for children than other financial products, there are still question marks over whether they are a good idea. Although they are touted as helping children to learn about finance, this can be done in other ways apart from giving out a card. Also, keeping track of spending is not always easy, as some of the cards allow cash withdrawals, meaning that they could spend their money on anything. Also, there is the danger that parents will put too much money on the cards, which will have the opposite effect on teaching children about money and simply make them believe they can spend what they like. Also, there are fees involved in these cards, such as an application fee and top up fees. Although these cards might be good for some families, you should think carefully about the benefits and drawbacks before deciding on whether or not you want your child to have such a card.

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Reduce Credit Card Debt

You may be surprised to learn how easy it can be to reduce your credit card debt. With the average American household carrying $8400 in credit card debt a simple reduction plan could save thousands of dollars.

Step 1: The first thing you want to do to reduce your credit card debt is find out exactly how much money you owe on your credit cards. Then find out how much you are paying in interest yearly. For example, if you a paying $50 in finance charges on one credit card each month and $40 on another you are paying $1,080 in finance charges alone each year. Learning how much money you are paying in interest is usually enough to motivate most card holders to reduce their credit card debt.

Step 2: Once you have this information you can then decide whether to consolidate your debt to your credit card with the lowest interest rate or get a new balance transfer credit card with a low APR or lower interest rate. By transferring the balance to a lower interest rate credit card you can save thousands of dollars in interest. Please keep in mind that this is only a temporary solution. If you transfer the combined balances to a low interest credit card you must destroy the old credit cards and close the accounts so that you do not use them again. This is very important. If you transfer your balances to a new low interest credit card, then run the balances up again on the old credit cards you have committed the ultimate debt sin.

Note: If you are unable to qualify for a low APR credit card or balance transfer credit card contact each of your credit card issuers and request an interest rate reduction. Explain to them that you are having trouble paying your bills and would like their assistance with finding a reasonable solution. If you are successful, simply transfer your credit card debt to the credit card with the lowest interest rate.

After you have transferred your combined balances to a single low interest rate credit card you will want to create a weekly budget. The only way to pay down your debt is to pay your bills on time, and to pay more than the minimum amount due. This can be easily done by paying your credit card bill weekly. If you create a weekly budget that includes all of your expenses such as rent, mortgages, loans, phone bills, etc. you will discover exactly how much you can pay.

Step 3: Credit card interest accrues daily not monthly. Therefore paying your bill each week will greatly reduce the amount of overall interest you will pay. Since your balance will be slightly smaller each week, you will be charged less interest on that smaller balance than if you continued to make a single monthly payment. You can figure out your weekly payment by using your monthly minimum. For example if your monthly minimum payment is $50 then you will want to pay as much as you can above $50. If you determine you can pay $60 then you simply pay a fixed $15 each week even after the balance decreases. You can pay more if you are able; however do not begin paying less when you notice a smaller minimum payment. Continue to pay this fixed amount until the debt is paid off.

You can tailor this weekly payment method to suit your needs. You can have your weekly checks all written out and simply drop them in the mail each week, or you can have the funds automatically deducted from your checking or savings account each week. Just think of the fun and excitement you will have as your credit card debt is reduced.

R. L. Barnes, editor at FirstCredit.Net provides useful advice and assistance regarding credit, low apr credit cards and balance transfer credit cards. For more information you may visit their website.




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Credit Cards For Teenagers
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