A kid with a credit card…A smart move or a recipe for financial disaster? 

A smart move for sure to associate a personal profile with a social security number and protect against identity theft.  After all, who would believe that five year old female from New Jersey could qualify for a $150,000 mortgage in Ohio?  A lot of people if there was nothing else on record with the national credit bureaus associating that child with her social security number and an unblemished credit report.  We hear multiple stories of young people who apply for credit for the first time only to be informed that their credit has been ground into the ground by an identity thief.

What can you do to protect your kids?  Take out a credit card for each of your children and use it periodically for balances you can afford to pay in-full.  Unless you’re ready to teach your kids about being responsible with credit, there’s no reason to even given them responsibility for caring for the actual cards.  (I have to share though that it’s a thrill for a child when they do first learn to pay for something independently.)  Having a credit card for emergencies can also be a good idea for responsible younger adults as they start to travel on school trips and the like without you.