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18 year old son wants to start building credit. Recommendations?
Posted on 2/6/13 at 11:16 am
Posted on 2/6/13 at 11:16 am
What would be a good card for him to start out with? Or what would the wise MT'ers suggest? I started out poorly when I was his age. Glad he's approaching it the right way.
Posted on 2/6/13 at 11:20 am to htownjeep
open a bank account and a credit card.
Posted on 2/6/13 at 11:22 am to C
quote:
open a bank account and a credit card.
This. Buy a few things every month and put it on the card and make sure it's paid in full every month
Possibly a card that requires a payoff
Posted on 2/6/13 at 11:24 am to C
quote:
open a bank account and a credit card
The first part is much easier to do than the second.
1) He isn't going to have choices for rewards and he won't get the best interest rates. It's beginner credit.
Is he a student? If so, Capital One Bank has a card that is aimed at first time credit card holders. It will have a $300-$500 credit limit to begin. Probably his best option.
This post was edited on 2/6/13 at 11:25 am
Posted on 2/6/13 at 11:25 am to C
quote:
open a bank account and a credit card.
He's had a Chase checking account (and has his own debit card with it) since he was 15. So maybe go to a branch and see if they'll give him a credit card? It would more than likely be a secured credit card right?
Posted on 2/6/13 at 11:33 am to htownjeep
quote:
He's had a Chase checking account (and has his own debit card with it) since he was 15. So maybe go to a branch and see if they'll give him a credit card? It would more than likely be a secured credit card right?
It would be preferable for him to get an unsecured credit card. Make sure that he applies for a card with an institution that offers both secured and unsecured cards. That way they won't have to pull his credit twice. I know that Capital One offers both. Call and ask Chase if they offer secured credit cards.
I've had 2 friends apply with Capital One in the past 2 years that had zero credit. Actually the 1st one had a very small non credit collection on the report. She had to get secured with $200 CL and $49 into a savings account to secure it. The other person had absolutely nothing on her report. She was able to get $500 unsecured credit card.
Posted on 2/6/13 at 11:43 am to htownjeep
I don't know if they tightened it up after the credit crunch, but if he uses Amazon a lot get the chase amazon card.
Probably the best rewards card for begining credit.
Probably the best rewards card for begining credit.
Posted on 2/6/13 at 11:47 am to Siderophore
LINK
100 points is equivalent of a redeemed dollar.
3 points per dollar at all amazon purchases
2 points per dollar for gas, resturants, and drug stores
1 point for everything else.
And there are multiplier bonuses for things like buying 300 dollars worth from Amazon a month.
100 points is equivalent of a redeemed dollar.
3 points per dollar at all amazon purchases
2 points per dollar for gas, resturants, and drug stores
1 point for everything else.
And there are multiplier bonuses for things like buying 300 dollars worth from Amazon a month.
Posted on 2/6/13 at 2:49 pm to htownjeep
I went to my credit union got a collateral loan paid it back and then got Capital One credit card
Posted on 2/6/13 at 3:17 pm to htownjeep
he sounds smart, tell him to worry more about doing good in college. Live poor for the next 5-10 years, save money in a retirement account, marry the right person, get a good job. credit score will adjust itself accordingly and is much less important than the above.
Posted on 2/6/13 at 3:28 pm to htownjeep
add him as a user to one of your cards
Posted on 2/6/13 at 4:49 pm to htownjeep
quote:
He's had a Chase checking account (and has his own debit card with it) since he was 15. So maybe go to a branch and see if they'll give him a credit card?
Doubt they will with zero credit history as I tried to do the same thing a few years ago. Dad had to open a new card with my name added to it.
Posted on 2/6/13 at 5:00 pm to yellowfin
As said by a few, I'll either just add him to one of my cards or co-sign a loan for him.
I have an old credit union account and I called them to see what they might have as well. They have a "credit builder" loan that he can take out. He'll never see the money for the term of the loan (example is $1k) but he'll make monthly payments on it. At the end of the term he'll get the loan money plus any accrued interest on it. Kind of like a forced savings account that he can't touch, but has to pay the payments.
I have an old credit union account and I called them to see what they might have as well. They have a "credit builder" loan that he can take out. He'll never see the money for the term of the loan (example is $1k) but he'll make monthly payments on it. At the end of the term he'll get the loan money plus any accrued interest on it. Kind of like a forced savings account that he can't touch, but has to pay the payments.
Posted on 2/6/13 at 5:14 pm to yellowfin
My son is a user of our card ... THAT helps him to build credit? I honestly don't think I knew that since the bill comes to us and is paid by us. (He uses it for gas, things for school.)
And I thought if under 21 yo you had to have a parent co-sign???
And I thought if under 21 yo you had to have a parent co-sign???
Posted on 2/6/13 at 6:32 pm to tiger91
quote:lol. no.
And I thought if under 21 yo you had to have a parent co-sign???
Posted on 2/6/13 at 6:44 pm to htownjeep
Get him to apply for the Discover cash rewards card, it's their basic free card and it was my first card a few years back. No complaints and it actually has decent cash back if you catch gas or groceries on the rotating 5%
Posted on 2/6/13 at 10:56 pm to htownjeep
Add him as an authorized user on your cards and don't actually give him the card.
That is unless ur a broke dick
That is unless ur a broke dick
Posted on 2/6/13 at 10:58 pm to htownjeep
quote:
I have an old credit union account and I called them to see what they might have as well. They have a "credit builder" loan that he can take out. He'll never see the money for the term of the loan (example is $1k) but he'll make monthly payments on it. At the end of the term he'll get the loan money plus any accrued interest on it. Kind of like a forced savings account that he can't touch, but has to pay the payments.
Typically u pay more interest than you earn on these. Not really worth it. I'd out some service like a cell phone in his name before I did that
Posted on 2/6/13 at 11:26 pm to htownjeep
My wife's parents got a card in her name on there account when she ~16. They let her use it for food, gas, and emergencies. She had a pretty nice credit score by the time we got married.
However, I feel like there are probably some drawbacks to this.
However, I feel like there are probably some drawbacks to this.
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