The Do’s and Don’ts of Giving Your College-Bound Child a Credit Card

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National nonprofit ACCC offers parents tips to consider before giving their college student a credit card.

Even though it may be their first credit card, banks have absolutely no patience with those who cannot pay their bills on time.

As September quickly approaches, students are preparing to head off to college and start the fall semester. This is an exciting, but stressful time when parents must decide: Is it time to set my child up with a credit card?

Although college seems like the logical time to introduce a credit card, many young adults have little to no experience with budgeting. This issue can lead to serious debt if given the so called ‘freedom’ that comes with a credit card. A recent study by Sallie Mae shows that most college seniors graduate with an average credit card debt of $4,100.

“Even though it may be their first credit card, banks have absolutely no patience with those who cannot pay their bills on time,” said Steve Trumble, President and CEO of American Consumer Credit Counseling. “A secured card may be the better option if your child has little budgeting experience or a habit of going on various spending sprees.”

Parents who decide to go with the credit card must then decide which credit card would best suit their child. Some may choose to cosign for a new credit card, while others may just give their child access to the existing family account. Cosigning will give parents the opportunity to monitor their child’s credit card to ensure they are not spending too much on unnecessary things. Though, cosigning on your child’s credit card makes you just as responsible for the debt as your child. Others may choose a secured card where limits are set in place and a $300 to $500 deposit is made by the cardholder against the line of credit.

“Many college students overlook their credit card and forget to pay off their balances, leaving them with a hefty debt,” said Trumble. “To avoid this, parents should set boundaries with their children prior to setting them up with a credit card.”

With 84 percent of college students admitting to needing more education when it comes to financial management, it is important that parents discuss creating a budget prior to giving their child a credit card. A budget will help students limit the temptation to make frivolous purchases and enable them to start building credit in a responsible fashion.

With the fall semester approaching, American Consumer Credit Counseling offers three do’s and don’ts when it comes to giving students credit cards:
1.    Cosign on the credit card – By cosigning on the credit card, parents have the opportunity to monitor their child’s spending to ensure they are being responsible and not going on excessive spending sprees .

2.    Teach students about credit early – Provide your children with the tools they need to be financially successful early on so you can feel confident that they will use the card responsibly.

3.    Shop Around – Do your research and compare credit card options to make sure you are getting the best card to fulfill your child’s needs.

1.    Constantly pay off student’s debt – Limit your child to one ‘bail out’ to show them they need to learn how to become financially independent and responsible.

2.    Use on-campus credit cards – Don’t let your student sign up for a credit card at an on-campus table that is giving away freebies. There could, and probably are, cheaper and better cards out there.

3.    Give students more than they can handle – Start off slow by giving them one credit card so they can learn to be financially responsible. By having too many credit cards, it is easy to forget which has been paid off and which has not.

ACCC is a 501(c)3 organization that provides free credit counseling, bankruptcy counseling, and housing counseling to consumers nationwide in need of financial literacy education and money management. For more information, contact ACCC:

  •     For credit counseling, call 800-769-3571
  •     For bankruptcy counseling, call 866-826-6924
  •     For housing counseling, call 866-826-7180
  •     Or visit us online at

About American Consumer Credit Counseling
American Consumer Credit Counseling (ACCC) is a nonprofit credit counseling 501(c)(3) organization dedicated to empowering consumers to achieve financial management and debt relief through education, credit counseling, and debt management solutions. ACCC provides individuals with practical debt solutions for solving financial problems and recognizes that consumers’ financial difficulties are often not the result of poor spending habits, but more frequently from extenuating circumstances beyond their control. As one of the nation’s leading providers of financial education and credit counseling services, ACCC’s certified credit advisors work with consumers to help them determine the best plan of action to get out of debt and regain financial stability. ACCC holds an A+ rating with the Better Business Bureau and is a member of the Association of Independent Consumer Credit Counseling Agencies. For more information or to access free financial education resources, log on to or visit

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Tony Catinella
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