By David
For many of us, learning to write checks and balance a check book were necessary lessons as we grew and began paying our own way, but in our modern society built on computers and mobile apps, the lessons we teach our children must change with our society. One of the greatest concerns is teaching our children how to appropriately use and manage a credit card. But how can we help them learn without immediately exposing them to the perils of un-savvy credit card use? Easy, we can teach them credit cards with money.
Prepaid Credit Cards
One of the best tools we have at our disposal for this very task is the prepaid credit card. A prepaid credit card works much like a gift card, but is associated with a major credit card company and thus can be used almost anywhere to make in store or on-line purchases. A quick search on your favorite search engine provides a list of options to choose from. Just pick your favorite, load it with money, and go. Not only does using a prepaid card help your child grow accustomed to how the typical transaction goes in a store, but also opens up other related teaching opportunities.
Teaching your children credit cards with money allows you to show them the online process of transferring money between accounts. This opens up the door to teach them all about the online interface and each of its useful options.
Having our children’s prepaid credit cards loaded with money rather than giving them cash will allow them to make online purchases more easily and opens the doors to a world of shopping opportunities and to potential lessons on how to make purchases online safely, how to tell if a web site is secure or not, and how to minimize the risks of having your money stolen from you, including using prepaid cards loaded with just enough to make your purchases instead of a typical debit card.
Knowing that no one is perfect you can use prepaid credit cards loaded with money instead of a traditional credit card to set realistic spending limits for your children and introduce them to the consequences of spending without tracking. They will only be able to spend as much as you load on the card and if they exceed that the card is declined without incurring overdraft fees, over limit fees, or 15% or more interest that they’ll spend the next several months struggling to pay off.
Additionally, should your child ever need money for an emergency relatively quickly and happen to be too far away to simply give cash, you have the option to add money to their account from the comfort of home. No need to hop in the car and rush cash over to goodness knows where.
As you can tell credit cards loaded with money can be an excellent option to help your children wade into and begin to acclimate to our ever more complex financial system.
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