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4 Good Reasons for High School Grads to Open a Credit Card

Parents giving credit card to excited teen daughter.

Image source: Getty Images

It's graduation season, and many high schoolers and their parents are preparing for the next steps. Whether your high school grad is going to college, taking a gap year, or is ready to jump into the workforce, now is the perfect time to teach them essential personal finance skills to help them succeed in adulthood. Despite their importance, financial skills typically aren't taught in the high school classroom.

While some parents may fear their teens opening a credit card due to the dangers of overspending and falling into expensive credit card debt, learning how to use credit cards with care in early adulthood can be advantageous. Here are a few good reasons for high school grads to open a credit card now rather than waiting until later in their 20s.

1. Learn how to manage spending

It takes time and practice to learn how to manage money well, and it can be beneficial to learn this skill before your teen has a lot of bills and financial responsibilities. One way for your teen to learn how to manage their money better is by using credit cards.

Teens can learn how to set monthly spending limits and the importance of not charging more than they can afford to pay to avoid credit card interest charges. Learning this early in adulthood can help your high school grad avoid credit card debt now and in the future.

2. Learn the dos and don'ts of credit card usage

In addition to learning to manage their money, high school grads can better grasp the dos and don'ts of credit card usage by getting a credit card. With your guidance, your teen can learn important credit card basics they'll carry with them throughout adulthood.

Understanding credit limits, the importance of paying more than the minimum amount due, and paying every bill on time can set your teen up for success and help them avoid late fees and credit card interest. If they don't learn these skills, they may make poor choices in the future.

3. Start building credit

It can be beneficial to establish credit early. If your child ever needs a car loan or mortgage, their credit history and credit score will be considered during the lending process. Getting a credit card and using it carefully is a great way for your teen to start building their credit now. If they wait to build credit, it can take a long time to achieve a good credit score.

4. Be prepared for emergencies

There may come a time when your child needs to pay for an unexpected expense. If it's a pricey expense, it could be challenging for your teen to cover the cost using only cash. Having a credit card available for emergencies can give you and your child greater confidence. You may not always be around to help them out of a tough financial spot, so a credit card can be helpful.

Credit cards aren't all bad news

Anyone can rack up credit card debt if they're not careful, but it's also possible to make good spending and payment decisions that avoid debt. Allowing your high school grad to open up a credit card and helping to teach them good money management skills now can make their life easier. Review our list of the best credit cards for young adults to learn more.

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