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Allowing your teen to have their own credit card offers many positive outcomes as long as there are limits included.

Now, more than ever, our teens need to be better prepared for becoming independent. I remember having classes in high school that taught you how to balance a checkbook, write a check and create a budget. Classes like these are electives and our teens don't have the luxury to take this type of class. Their focus has to be on honors classes and extra science courses in order to get a 4.2 GPA just to get into their college of choice. Our teens end up very educated, but not with the day-to-day stuff. These kids will be rocket scientists, but will have no idea how to run a household.

It is also important for them to understand how to use credit and not abuse it. They should see their credit first hand on a credit report; understand the ramifications of having too many credit inquiries and late payments; and learn how interest rates work. As a real estate professional, I have seen so many people try to qualify to buy a home, but they have no credit experience. Getting started with credit at a young age would be beneficial in the long run.

Of course, there must be limits. I believe these teen credit cards' should have an extremely low limit and must be paid off each month. It would be easier for parents to add credit to the card as allowance payments than to try to scrounge up cash all the time.

Credit cards are also much safer than cash. I don't allow my pre-teen children to have too much cash in their wallets for fear of them misplacing their purse/wallet. It is much easier to cancel the credit card than to replace the cash.

My daughter would love the independence of going to the mall with her own credit card to do that dreaded back to school shopping without dragging Mom along.

Learn more about this author, Kimmee.
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