Parents need prepaid credit cards for their children

Your teenagers should know about the perils of credit card debt before they get their own credit card.

These days many teenagers have their own credit or debit cards or have access to parents' credit cards. The trouble is many are not responsible credit cards users. When young people have money they love to spend and once teenagers have left home, spending without thinking about how to pay off the bills often leads to large debts.

 Are you a parent who wants your children to learn financial skills?

We live in an unusual world where children are granted credit even before they have earnings to justify their ability to repay. University students are an obvious target; because marketers assume they will go on to get good jobs or their parents will help them out when necessary.

Before your children enter college, where they will likely be bombarded with opportunities to sign up for multiple credit cards, it is important to educate them about the perils of credit card debt.

By educating your children early on about effectively managing their expenses, you will teach them a priceless lesson, which will hopefully prevent them from making costly mistakes in the future.

Using prepaid cards provides teenagers with the crucial experience of living on a limited budget and being accountable for their fiscal decisions. The use of the prepaid credit card will ensure that the teenager or student won't overspend, as they can only spend up to the amount of money that the parent has deposited into the account.

Prepaid credit cards can solve your problem.

The prepaid credit card solves children's' needs for a way to carry their money safely and parents' needs to control where the teenagers do their spending.

Parents reinforce responsible card usage by monitoring their teenagers' spending through the prepaid card's tracking tools. The prepaid credit card gives teen's hands-on money management experience in a controlled, parent-supervised environment -making it an excellent first payment card and an ideal tool for teaching financial responsibility.

Parents deposit money into an account, and the teen card user can charge up to the amount that's available in the account. Parents can add more money on a regular basis for an allowance or whenever the money runs low. That's easily done by transferring money from the parents' bank account or their own regular credit card.

Prepaid cards allow parents to set spending limits and monitor where their children are spending money, both through monthly statements and through Internet accounts that show daily transactions. The parents transfer money from their own checking accounts to the card for a small transaction fee, and the card can be used like any other credit card to make purchases.

The prepaid card offers teen cardholders spending independence and flexibility, while keeping parents informed, involved, and in control.

Powerful parental control

If the student calls home complaining about the cost of books and supplies, but the parent sees money spent on clothes or at the student bar, you can be sure there'll be a confrontation.

Some card providers offer more powerful parental control capabilities: Parents can cancel or suspend the card at any time. And parents can sign up for an e-mail alert when the card is used at a merchant that might sell inappropriate materials for teenagers. That gives some real control over these independent teenagers.