In the United States of America, people have a terrible habit of spending money. Now a recent survey has found the usage of credit card among US children has increased and it’s creating some financial problems for many people. The report shows usage of credit card among small children aged between 8-14 going up from 4% in 2012 to 17% in 2018. The usage of credit card has risen significantly in small children, and it shows a different side of parents who gives access of their finances to their small children. Out of all, only 41% of the credit card users pay their own bills, and their parents pay 59% of children’s bills.
It shows there are very few groups of children who are using a credit card in the right way. However, parents have all obligations regarding children’s usability about credit card because no minor person is allowed to use a credit card. Experts said that many parents give authorized access to the children of their credit card and that’s where the majority of parents makes the most significant financial mistake. Usage of a credit card represents obligations and debt which a person later has to pay to the bank along with interest. More than 52% of parents have found to give the authorized access of their credit card to their children, but 29% of the parents said that their kids used a credit card without their consent.
Experts think it’s highly necessary for parents to track what their kids are using the credit card for because other than that they won’t know where the exact spending is going. Many banks offer the facility of tracing the history of every purchase made by credit card, and if your children are using it, then you should better know where they are spending the amount. Children’s own credit history is also essential because later when they will become an adult, they will be judged by the banks by their credit record. It’s highly advisable for parents to keep a track on spending made by the users with the help of credit card. One of the best ways to give a little bit of financial freedom to children is by giving them prepaid or debit card because that’s going to put a natural limit on their spending.