Your Kids and Credit – Part One:  Where To Start

As a responsible parent, it is important to teach your kids about the wonders and pitfalls of money management. But if you are in financial trouble yourself, how do you teach your kids anything that will have meaning for them? Remember, just because you are having temporary financial troubles, does not mean that you don't know what needs to be done. Teaching them will also remind you of the best ways to handle money issues. Here are some ideas to help keep them safe:

What About the College-Aged Kid?  When a child is in college, the parent loses much more control over the spending issues…especially if the college student is motivated to earn their own money by working part time. If a parent has done a good job with the teenage phase, then this will not be so hard. A prepaid card can also work in this situation, but it is no longer an "allowance" unless they are living at home. If you are going to provide a credit card to your college student, be sure to teach them responsible credit card use. Although college kids have opportunities to open their own credit cards, make an agreement with them to assist them by having access to the online account so you can keep tabs on the spending and catch problems before they become catastrophes. If your college student has activated his own cards without you co-signing for them, then be sure that he/she gets a regular monthly credit report from a service. Sit down at least once per quarter and show them the effects of their financial choices.

Protecting Your Child's Credit.  "Monitor your mail, and be suspicious if materials such as offers for pre-approved credit cards show up in your child's name. Suspicious credit documents could be cause for alarm. Monitor your child's online activity, particularly if your child is frequenting social networking sites and/or chat rooms, and making online purchases. Educate your child about the importance of keeping personal information, such as last name, address, etc., private when sharing information online. Educate your child about unsolicited email scams – "phishing" emails – that ask for personal information. Be sure that your child knows to delete fraudulent emails of this sort. Don't allow children to carry their Social Security cards in their wallet or backpack, and don't carry them in yours. Instead, retain ownership of these cards, and keep them in a safe place."…Experian Credit Education

Watch for Part Two in this series.