Debt Consolidation
4 Financial Tips For Teenagers
More and more teenagers are getting credit cards in their own name. I am a huge advocate of people learning about personal finance at a young age. There should be finance classes taught at every middle school and high school. Unfortunately, personal finance has always been something people learn through trial and error. This method can often times be very expensive (look at a teen's cell phone bill). However, there are some wise steps that teenagers can take to become more finance savvy. These are 4 smart financial tips for teenagers.
1. Start out with a store-based credit card or debit card.
Like most other steps in life, I don't suggest taking everything on at once. Start out small when it comes to personal finance. A high school aged teenager should have a store based credit card and/or a debit card. These cards are safer than a standard credit card, but can teach someone a lot about credit and finance. Giving a teen the responsibility of one of these types of payment will teach them about bill paying, budgeting and discipline.
2. Get a checking account as soon as you can.
A teenager should have a checking account as soon as they can. A general rule of thumb is that someone is eligible for their own checking account at 18 years of age. Hopefully, you have a checking account before you graduate high school. Not only does having a checking account prepare you for future financial responsibility, but it also forces you to learn to write checks. Although more and more is being paid online or over the phone, writing a check is something everyone should be able to do.
3. Sign up for online banker.
Online banker is a wonderful tool that the computer-generation can take advantage of. It is always important to teach people why something works the way it works in addition to just showing them how it works. Most online banking software shows everything from current account balances to every expense paid for with a debit card or check. Computer savvy teenagers will have no problem understanding this simple software, and it can be a great asset to help teenagers understand the inner working of personal finance. Online banker is a great tool to avoid debt problems like the need for debt counseling or debt consolidation.
4. “Graduate” to a low limit credit card.
Once a teen has spend a period of time using a store based credit card and/or debit card responsibly, it is time to move on to a low limit credit card. A low limit credit card is the same thing as your general credit card, just with a lower limit. What this does is safeguards against overspending. This low limit card holder can still charge normally, though. These two reasons are why a low limit credit card is perfect for a high school senior and college freshman.
1. Start out with a store-based credit card or debit card.
Like most other steps in life, I don't suggest taking everything on at once. Start out small when it comes to personal finance. A high school aged teenager should have a store based credit card and/or a debit card. These cards are safer than a standard credit card, but can teach someone a lot about credit and finance. Giving a teen the responsibility of one of these types of payment will teach them about bill paying, budgeting and discipline.
2. Get a checking account as soon as you can.
A teenager should have a checking account as soon as they can. A general rule of thumb is that someone is eligible for their own checking account at 18 years of age. Hopefully, you have a checking account before you graduate high school. Not only does having a checking account prepare you for future financial responsibility, but it also forces you to learn to write checks. Although more and more is being paid online or over the phone, writing a check is something everyone should be able to do.
3. Sign up for online banker.
Online banker is a wonderful tool that the computer-generation can take advantage of. It is always important to teach people why something works the way it works in addition to just showing them how it works. Most online banking software shows everything from current account balances to every expense paid for with a debit card or check. Computer savvy teenagers will have no problem understanding this simple software, and it can be a great asset to help teenagers understand the inner working of personal finance. Online banker is a great tool to avoid debt problems like the need for debt counseling or debt consolidation.
4. “Graduate” to a low limit credit card.
Once a teen has spend a period of time using a store based credit card and/or debit card responsibly, it is time to move on to a low limit credit card. A low limit credit card is the same thing as your general credit card, just with a lower limit. What this does is safeguards against overspending. This low limit card holder can still charge normally, though. These two reasons are why a low limit credit card is perfect for a high school senior and college freshman.