Building a Solid Credit History: Advice Parents Should Give Their Children
It’s never too soon to help your student understand how important a good credit history will be in the near future. Credit history measures a consumer's ability to repay debts and their demonstrated responsibility in repaying debts. Your student’s consumer history (numerically represented by an individual Credit Score) will be used when approving credit (credit cards, home loans, store cards, car loans, etc.). Credit history is also critical when renting an apartment, applying for utilities, cable TV, or even a cell phone plan. Everywhere they turn their personal credit history will be verified in order to access basic services, so it’s critical they learn to behave in such a way that helps them establish and maintain a positive credit history.
Talk to them about the fact that a negative credit history will cost them money. This could be in the form of higher interest rates on a car loans, credit cards, or even home loans.
Today's tip brought to you by Mvelopes and Money4Life Coaching.