Credit card options for teens under 18 years old | finder.com
Credit card options for teens under 18 years old

Credit card options for teens under 18 years old

It’s a common question on parents’ minds: How young is too young to get a credit card? Legally, no one can get a credit card on their own unless they’re at least 18 years old. Anyone under 18 can only be an authorized user on someone else’s — for example, their parents’ — account. Here’s how to teach your teen solid financial habits and your best options to start them on solid footing.

Credit card or no credit card?

You might think your teen is far too young to use a credit card. But you’ll find two big reasons it could be a good idea for them to have one.

1. Teach your teen how to use a credit card responsibly.

After adding your teen as an authorized user, you have control over their account and can see how they use their card. With insight into their spending, you can more effectively teach them solid financial habits. It’s better for them to learn from you now than figure everything out on their own later.

2. Help your teen build credit early.

Most people start with a brand-new credit history when they’re ready to get a credit card. This usually means they’re limited to student cards and secured cards, both of which typically come with limited features. You can help your teen build an impressive credit history before they reach adulthood. Just add them as an authorized user on your account and consistently make payments on time. When they turn 18, their credit may be strong enough to expand their card options considerably.

Be careful about bringing your teen aboard

Before adding your teen as an authorized user, consider how responsible you are as a cardholder. Why? Because your teen’s fortunes will rise and fall with yours. If you pay on time, your teen’s credit will improve. If you consistently miss payments, you’ll damage your teen’s credit. Bring your son or daughter for the ride if you’re on top of your credit card payments. But if you have trouble keeping up, it’s probably better not to add authorized users at all.
The “under 21” user’s guide to credit cards

Debit and prepaid cards first — then credit cards

Though your teen could benefit from a credit card, you don’t have to give them one right away. In fact, it might be a good idea not to: A credit card can be a powerful financial tool, but only if it’s used responsibly. Teach your teen solid financial habits as early as possible. When you’re confident your child has the skills to manage their money, consider letting them graduate to a credit card.

Credit cards for different age groups

Tweens: 11–13 years old

This age range is a good time to introduce your tween to debit and prepaid cards. These cards are a relatively safe way to teach your child how to spend responsibly. They don’t accrue interest, and they draw from preloaded money through a bank account or other source.

Teach your tween about the concept of a credit limit. Load the card with more money than your tween actually needs, and make that amount the “credit limit.” Then instruct them to keep spending well below that limit. The point is to teach your tween how to keep their credit utilization ratio low. For prepaid cards, consider options like FamZoo and TD Go, which allow you to monitor your child’s spending.

Teens: 14–17 years old

If your teen proves they’re able to responsibly use a debit or prepaid card, consider letting them graduate to a credit card. After you add them as an authorized user, you can monitor their spending. At the same time, you can teach them how to manage credit before they get their own card.

Teach your teen how to make card payments on time. Set up automatic payments so that you never miss a payment on your teen’s card account. Meanwhile, ask your teen to repay you monthly by a certain date. This helps them learn how to make card payments on time. If they miss a due date, neither their nor your credit score will drop — your automatic payments have you covered.

Encourage your teen to pay off their full balance each month. This is a great habit that will keep them out of debt later. While you’re at it, praise your teen for keeping their credit utilization ratio low.

Is there a minimum age to become an authorized user?

Many card issuers — Bank of America, Capital One and Chase — have no minimum age for authorized users. Others have minimum ages of 13 to 16.

Know the risks of having a credit card

While you still have them under your wing, teach your teen how to avoid trouble with a credit card. Here are a few common pitfalls they should know about.

  • Making only the minimum payment. A cardholder is allowed to make only the minimum monthly payment on their credit card. However, that’s arguably the worst thing to do behind paying late. Paying the minimum allows interest to snowball and debt to accumulate.
    Here’s what to do: Show your teen why it’s smart to pay off their balance in full each month. Teach them how credit card interest accumulates, and how it can be avoided.
  • Overspending. Teach your teen that they should avoid spending close to their credit limit. Carrying a high balance puts one in danger of incurring overlimit fees, on top of accumulating high debt. Many experts recommend keeping spending under 30% of one’s credit limit.
    Here’s what to do: Encourage your teen to spend less than they receive from their allowance or job. Teach them how their credit utilization ratio affects their credit score. And explain why it’s smart to keep their ratio under 30%.
  • Paying late. This is a sure path to decreasing a credit score. Because your teen is an authorized user on your account, you can protect them by paying your card bill as usual. But if you see signs your teen may pay late in the future, it’s best to nip the problem in the bud.
    Here’s what to do: Set up automatic payments on your card account so that you never miss a payment on your teen’s card account. Meanwhile, ask your teen to repay you by a certain date each month. Encourage them to set up phone or calendar reminders so they don’t forget.

How does my credit utilization ratio affect my credit score?

Provider rules and recommended credit cards

BanksWhich banks offer authorized users under 21
American Expresscross-icons
Bank of Americatransparent-green-tick
Capital Onetransparent-green-tick
Chasetransparent-green-tick
Cititransparent-green-tick
Discovercross-icons
Wells Fargotransparent-green-tick

Frequently asked questions

Compare credit cards

Rates last updated February 25th, 2018
Name Product APR for Purchases ( Purchase Rate ) Intro APR for Balance Transfer Annual fee Product Description
Barclaycard Arrival Plus® World Elite Mastercard®
17.24%, 21.24% or 24.24% variable
0% Intro APR for 12 months (with whichever is greater: $5 or 3% balance transfer fee)
$0 annual fee for the first year ($89 thereafter)
Enjoy 40000
bonus miles after you spend on purchases in the first 90 days — that's enough to redeem for a $400 travel statement credit toward an eligible travel purchase.
Luxury Card Mastercard® Titanium Card™
16.24% variable
0% Intro APR for for the first 15 billing cycles (with whichever is greater: $5 or 3% balance transfer fee)
$195 ($95 for each Authorized User added to the account)
Enjoy unique excursions, privileged access to exclusive events and insider opportunities.
HSBC Gold Mastercard®
12.24%, 16.24% or 20.24% variable
0% Intro APR for first 18 months from account opening (with whichever is greater: $10 or 4% balance transfer fee)
$0
An 18-month 0% Intro APR period on both purchases and balance transfers, plus zero foreign transaction fees, makes this is a strong well-rounded card.
Indigo® Platinum Mastercard® Credit Card
23.9% variable
$75 annual fee for the first year ($0 to $99 thereafter)
With this card you get a 23.9% variable APR.
Barclaycard Ring™ Mastercard®
10.24% variable
$0
A low, variable APR on purchases, balance transfers and cash advances.
Credit One Bank® Visa® with Free Credit Score Tracking
17.24% to 25.24% variable
$0 to $75 first year annual fee for the first year ($0 to $99 thereafter)
Get 1% cash back rewards on eligible purchases including gas, groceries, and services such as mobile phone, internet, cable and satellite TV, terms apply.
Credit One Bank® Unsecured Platinum Visa®
19.15% - 25.24% variable
$0 to $75 first year annual fee for the first year ($0 to $99 thereafter)
Give your credit a boost with credit line increase opportunities, a fee may apply.
The First Access VISA® Credit Card
29.99% variable
$75.00 for first year. After that, $48.00 annually.
Access credit even if you have poor or limited credit history.
Simmons Bank Visa® Platinum
9.25% variable
$0
The Simmons Bank Visa® Platinum Card offers multiple perks, including one of the lowest available APRs on the market.
Credit One Bank® Unsecured Visa® with Free Credit Score Tracking
19.15% - 25.24% variable
$0 to $75 first year annual fee for the first year ($0 to $99 thereafter)
Get 1% cash back rewards on eligible purchase, terms apply.
Simmons Bank Visa® Platinum Rewards
11.25% variable
$0
Excellent Credit Required - Applicants that do not have excellent credit will not be approved

Compare up to 4 providers

Rates last updated February 25th, 2018
Name Product Product Description APR for Purchases ( Purchase Rate ) Annual fee Interest Free Period
primor® Secured Mastercard® Gold Card
Low fixed interest rates with no penalty rate.
9.99% variable
$49
Up to 25 days
First Progress Platinum Prestige Mastercard® Secured Credit Card
You can increase your credit limit by adding funds to the initial deposit.
9.99% variable
$49
Up to 25 days
OpenSky® Secured Visa® Credit Card
A secured Visa® credit card that helps you build your credit quickly.
18.64% variable
$35
Up to 25 days
First Progress Platinum Elite Mastercard® Secured
With just a security deposit and 19.99% variable APR, start building or rebuilding your credit history.
19.99% variable
$29
Up to 25 days
UNITY Visa Secured Credit Card
Borrow up to $10000 and get your credit score back on track.
17.99% fixed
$39
Up to 25 days
Applied Bank Secured Visa Gold Preferred Credit Card
This secured card can help you rebuild your credit with an initial deposit of $200 to $1,000.
9.99% fixed
$48
0 interest free days
State Department Federal Credit Union (SDFCU) Savings Secured Visa Platinum Card
Created to help you establish or rebuild credit.
13.24% variable
$0
Up to 21 days
SKYPASS Visa® Secured Card
Earn SKYPASS miles while building your credit history in the United States.
17.49% variable
$50
Up to 24 days

Compare up to 4 providers

Rates last updated February 25th, 2018
Name Product APR for Purchases ( Purchase Rate ) Annual fee Product Description
Target REDcard Credit Card
23.90% variable
$0
A no annual fee credit card and discounts when you shop at Target.
Fingerhut Credit Account
25.90% variable
$0
The Fingerhut Credit Account is store-specific, and used to finance purchases made from Fingerhut.com or Fingerhut FreshStart’s catalogue.
Fingerhut Advantage Revolving credit account
25.90% variable
$0
Helps you keep building your credit as you buy great name brand products.
Fingerhut FreshStart® credit account
25.90% variable
$0
Get instant access to purchase items in the Fingerhut store with no overlimit fees.
Horizon Gold Card
0%
Get a 500 credit limit to make purchases on the Horizon Outlet website.
NetFirst Platinum
0%
Looking for the best card? You can have it while you build your credit with Horizon Card Services. Get an unsecured line of credit and the best customer service!
Luxe Signature Card
0%
$0
For purchases on HuttonChase.com with a maximum credit limit of $1500.00.
Next Millennium Card
0%
Shop the items you need at myuniqueoutlet.com with up to a $1000 credit.
Emporium Card
Varies by balance. See website for details*
$0
Get a $300 to $5000 instantly to shop 100,000+ items at Emporium.
WALMART® credit card
23.90% variable
$0
Overstock Store Credit Card
27.99% variable
$0
6, 12, 18, and 24-month financing options available and special promotions just for cardmembers.

Compare up to 4 providers

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US Credit Card Offers

Important Information*
Luxury Card Mastercard® Gold Card™
Luxury Card Mastercard® Gold Card™

APR

16.24
variable

Annual fee

0 For the first year
More info
The First Access VISA® Credit Card
The First Access VISA® Credit Card

APR

29.99
variable

Annual fee

75 For the first year
More info
Indigo® Platinum Mastercard® Credit Card
Indigo® Platinum Mastercard® Credit Card

APR

23.9
variable

Annual fee

75 For the first year
More info
Barclaycard Arrival Plus® World Elite Mastercard®
Barclaycard Arrival Plus® World Elite Mastercard®

APR

17.24
TO
24.24

Annual fee

0 For the first year
More info
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