Should High School Students Have a Credit Card?

The younger students mainly in their teens are now the flavor of the credit card companies. They are now being targeted by these companies by providing them with the high school student credit cards or popularly known as teen credit cards. These are mainly the prepaid or secure credit cards in which the money is preloaded onto the cards. The teenagers can only spend the amount of money that is preloaded on the card and not beyond that limit.

The high school students are falling into the trap of credit card companies because they are those set of population of who spend more amount of money and not have required amount of knowledge about borrowing and to use a credit card. Teens are now becoming more powerful customers and are often trusted by their parents to take most of the purchase decisions. Credit card companies mainly encouraged by those numbers have saturated the adult card market and now eyeing the younger high school students.

A student interested in getting a teen credit card must first open a prepaid credit account by depositing some money into that account. The student is then issued a prepaid credit card once he has deposited the money in the prepaid account. The prepaid credit card can be used anywhere. It is just same as using a regular credit card. A student cannot spend any more until he makes further deposits into his prepaid credit account.

These days, parents also provide teen credit cards to their children's in order to ensure that they will overspend as they will only be able to spend the amount of money that their parents have deposited in their prepaid credit account into the bank. The use of high school student prepaid credit cards is generally very prevalent among the students nowadays. The students use the prepaid credit cards to learn the credit building ability and also learn good money management skills.

The parents can help students a lot in building money management skills of the students. They both must discuss what types of purchases are appropriate with a teen credit card. It is important to consider that the appropriate purchase excludes anything that a teen can eat, drink or wear. The main motive behind this is to inculcate the habit of savings and using credit card wisely. Thus, the students must be responsible enough to use their card wisely otherwise their credit score can plunge very quickly, which is not good for their credit history in the long run.