6 Step Plan For How Parents Can Teach Their Children How To Properly Handle Credit Cards

How Parents Can Teach Their Children How To Properly Handle Credit Cards
When I say parents can give credit cards to students, I'm not focusing on students getting credit cards.

I'm focusing on parents taking charge of their children's financial well-being and future. Don't just give it to them, teach them what it is and how to use it properly.

Avoidance is an ineffective response to something that will not be avoided. Waiting, on it's own, will not guarantee a better outcome.

And if our children will eventually end up with credit cards (and they most likely will if the parents have one themselves), then it's much better to be proactive and teach them the right habits.

But how can we do that?

Just giving them a credit card and "winging it" would be fatal (financially speaking). That's no different than just waiting for them to get jobs and get one on their own.

Instead we have to be systematic about it.

Why Students Should Be Taught How To Use Credit Cards By Their Parents

Why Students Should Be Taught How To Use Credit Cards By Their Parents.  If you think about it, credit cards are only traps to the uninitiated. And responsibility is taught; it's not something you just grow into by virtue of the number of birthdays you've had.  For people who've learned to be responsible with their credit cards, these cards are actually a convenience at the very least; and maybe even a savings tool in an optimal setting.  With the lack of personal finance topics in our school's curriculum, how else are our youth going to learn about money matters if parents don't take the initiative?
A while back I featured a guest post about how students can apply for a credit card (along with some tips on handling it).

It was pretty run-of-the-mill, though I thought the concept of students handling credit cards was novel and I excitedly endorsed the idea. (As it turns out, it wasn't all that novel.)

I got a few random likes, but in one facebook group it was lambasted. The idea was apparently backwards and would result in disaster.

I had a long moment of self doubt. But as I thought deeply about it, I reaffirmed my earlier conclusion.

If you're a parent, and you're handling your credit card very well, then it's really a good idea to have your child get a credit card.

Why?

Out from the Abyss – Out of debt and compiling cash

Today we have a guest post about how to get out of debt.

On paper, it's a matter of saving as much as you can and paying off the debt as quickly as you can buy making the largest possible payments you can.

However, we all know that mentally it takes a certain amount of perspective to get through it.

Gale, our guest writer today, will share just how we can get guide ourselves out of debt.
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The Comprehensive Guide To Breaking Bad Habits And Making Good Habits Last For Good

The Comprehensive Guide To Breaking Bad Habits And Making Good Habits Last For Good.  We all have bad habits. Sometimes we call them weaknesses. And the best long-term solution is usually not to avoid them but to get to the root cause and deal with that instead.
Unfortunately, it's going to be another one of those rambling, self-absorbed posts. But if you stick with it, I promise it's actually helpful.

So I've had a spending problem for a few months.

Nothing big. I was still saving for retirement, the emergency fund, college education, yada yada yada. The problem was my personal savings.

After all those other savings, I've got a little left for myself. It's usually for direct stock investment, mini-mergencies, and the like. Ultimately, it's going to be my seed money for a potential business.

The problem started at Christmas. I normally, and on purpose, spend a lot on gifts plus occassional treats - both for myself and others.

I was able to still save half my 13th-month pay, but noticed I was spending what was supposed to be my personal savings. It didn't bother me during the holidays, but then it spilled over into January... then February... and even up to mid-March.

For some reason, my saving habit was backsliding. Anything I didn't pay myself first was getting spent. After years of not having that problem, I was very curious - and more than a little anxious - as to why that was the case.

So I did some research and found some interesting things.

6 After Death Expenses And The Best Ways To Prepare For Them Financially

6 After Death Expenses And The Best Ways To Prepare For Them Financially  Death is inevitable... and actually very costly!   But for most of us, there is no discussion about the topic - let alone any sort of preparation.
Death is inevitable... and actually very costly!

It causes such a big financial hit that it should be one of the most discussed expenses on par with tuition, food, and gasoline.

However, the opposite is true. For most of us, there is no discussion about the topic - let alone any sort of preparation. It's very understandable; our mortality - or that of our loved ones' - just isn't a nice topic.

It's a bit of a shame though, because most of the ways to prepare for this eventuality don't actually conjure images of death. For the most part, it's just more of the same: emergency funds and insurance.

Best Personal Finance Tip

Don't get into debt. Simple as that.

And you don't have to just take my word on it; hear it form Warren Buffet yourself.

Ownership, Stewardship, and Entitlement

Ownership, Stewardship, and Entitlement.   We can sometimes get lost in the feelings of ownership and entitlement. We feel entitled to what we own, and do not think twice about what we do with it.   We are not here simply to live and pass away for nothing. If we are to make progress in our lives, we must think of ourselves as stewards. We must recognize that life is more than what we see and have right now.
Disclosure: This article was originally written for and published in Each Peso Counts. Sadly, the blog isn't around anymore.

Companies typically have what they call core values. And in one of my previous companies, one of the core values was stewardship.

I still remember our executive talking about it. He explained that we should act not as employees but as part owners of the company. That we should take responsibility and help in the growth and success of the company because we should realize that the company's success is our success.

But recently, I began to understand this more deeply after reading a quote from Jaime Augusto Zobel de Ayala on the importance of stewardship in the continued success of Ayala Corporation:

7 Signs of Great Personal Finance Management

7 signs of great personal finance management.   When investing (in anything), having a good system, process, or set of guiding principles is the best way to ensure long term success. The same is true for almost everything else in life, including personal finance.  So I figured those 7 habits would make great "road signs" to let you know you're on the right path, regardless of the current state of your finances.  You are proactive, You begin with the end in mind, You put first things first, You Think Win-win, You seek first to understand, then to be understood,  You Synergize, You Sharpen the saw.
Disclosure: I adapted these from 7 Habits of Highly Effective People by Stephen R. Covey.

Most of the time you know your finances are in good shape if you have money - little to no debt, positive net worth, etc.

But to get there, there's a whole host of tips, rules, guides, advice, etc. that you can follow. But how can you judge if you're really doing great?

Maybe you're following some rules and ignoring others.

Maybe you're actually doing the right things now, but your finances are just bad because it took a beating from the time when you weren't so responsible.

Maybe you're an uber-sophisticated investor, but your family is strictly savings-account-only. If your finances are entwined, how do you evaluate that?

When investing (in anything), having a good system, process, or set of guiding principles is the best way to ensure long term success. The same is true for almost everything else in life, including personal finance.

So I figured these 7 habits would make great "road signs" to let you know you're on the right path, regardless of the current state of your finances.

Student Credit Card Application - Things You Need To Know

Student Credit Card Application - Things You Need To Know  Should students have credit cards? My answer would be a resounding Yes!  Letting them experience this responsibility while still in a position to monitor and guide them is a great opportunity. As long as the parents themselves are responsible credit card users, then they can save their child a potentially (and needlessly) expensive lesson.  What You Need to Apply for a Credit Card, What You Need to Know About Owning a credit card while you're a student.
For a long time now, the trend has been to "go young". It's most apparent in show-business; there actually used to be a time when you had to sing/act/perform for years, if not a decade, before becoming a star.  Now, if you make a big youtube hit, you're "it" - even if you aren't legally old enough to drink nor drive.

The same is true in everyday life. Children nowadays are exposed to all sorts of gadgets even before stepping foot in their first school. In fact, the question isn't if children should have cellphones, but when.

Which brings us to credit cards. After reading the title, you probably asked yourself "Should students have credit cards?"

And actually, one of my college classmates had one. But even if that weren't the case, my answer would be a resounding "Yes!"

At what age they acquire one depends on the parents. But if the parents have credit cards themselves, it makes a lot of sense. Responsibility is taught; it's not always a good idea to just throw them into the water and let them sink or swim.

Letting them experience this responsibility while still in a position to monitor and guide them is a great opportunity. As long as the parents themselves are responsible credit card users, then they can save their child a potentially (and needlessly) expensive lesson.

And with that, I'd like now give way to this guest post from MoneyMax.ph