I have a 17 year old son, who will be turning 18 this year, he wants to start a credit history, which means he wants to start building his credit, is there a credit card out there that he can get with NO annual fees, with a credit limit of 2 to 3 hundred dollars, until he proves him self.? I have looked and can't seem to find one that he can get on his own with out a co-signer and I'm not going to co-sign, I can't co-sign. I've had to file bankrup cause of his sister.

Fr_Chuck

Most likely there will be some for a 18 year old that has a 50 dollar annual fee, and a credit line of 500 dollars,

And let me see you want a 18 year old to be able to charge up to 3000, I would say this is about as stupid an idea as I have ever seen.
Sorry they don't need credit cards,

sGt HarDKorE

She said 300 not 3000. And you shouldnt say he doesnt need it or w/e if you dont even no him. If i had a credit card, i wouldnt screw up with it. I would only use it if i had money on my credit card.

CaptainForest

A lot of CC companies off student credit cards, also "youth"/young adults ones too.

Then again I live in Canada, but when I turned 18, I got a credit card, no annual fees, with a 500 dollar credit limit.

Call the credit card companies and ask them if they have a student/youth account.

Upon further looking into this, I have found the following:

Regarding the VISA credit card: Different option types can be found here:

http://usa.visa.com/cardadvisor/Stud...ose%20a%20Card

The first one on the list, Citi® Platinum Select® Visa® Card, has NO Annual fees

In fact, the first 5 all appear to have no annual fees.

However, if your son is not longer a student…

Go to page 2, third one down, the U.S. Bank Young Adult Visa. It says there is no annual fee as long as at least one purchases is made with the card each year.

Check into that list, I am sure you can find tons of others as well.

Remember the rule you must teach him. He should not use his credit card for ANYTHING unless he has the cash in the bank to pay it off today.

ScottGem

Will he be going to college? Lots of credit cards offered to college students that meet your criteria.

KCDave

And if they have the cash in the bank, why not just use, ummm cash? Why everyone feels they have to have a credit card is amazing. Why not try something out of the ordinary and pay cash for everything? Teach your kids how to save and they won't need to worry about a credit score.

ScottGem

Because its impractical to pay cash for "everything". If someone has to wait until they have saved enough money for a car or a home or any one of several other big ticket items, they may never be able to get them. So credit has to be used for some things, which means establishing a good credit history can save money by lowering interest rates.

KCDave

It's only impractical when you live beyond your means, like most of America does. A home is a little different, but like I said a person should be able to put a huge chunck down, get on a 15 year fixed rate mortgage and they will have no debt when they are in their forties, provided life doesn't throw them a curve ball.

Instead of getting my 17 year old a credit card I"ll be teaching him to put $500 in the bank so when his car breaks down he has the money to fix it. I'll be showing him how to make a budget and how if he starts saving $300 a month at age 25 he will be a millionaire at age 65.

ScottGem

Ok so you acknowledge that a home is a "little different". But that leads you down a slippery slope. Using your example, lets say a person paid off a 15 yr mortgage at 45. This means they got their mortgage at age 30. Now lets say they put down a "big chunk". The average home price in Oct 2004 was $264K. So lets say a big chunk was 30%. That means the person would have had to save more that $75K. Now assuming this person graduated college at 22, that means they had 8 years to save this money. Assuming compunding that would mean they would have had to save about $8K a year. Now in 2002 the average salary in the US was $36K. But even assuming a college grad would have higher earnings, we are still talking that they would have to save more that 20% of their take home pay. By the way that 15 yr mortgage would cost our hypotehtical person $1500 month (not including taxes and insurance. Which means they would need a take home salary of over $72 a year to be able to afford it.

And that doesn't take into account other living expenses.

Sorry Dave, but your idealistic look at finances is totally impractical. If you do the math it just doesn't work. Indeed our youth needs to be taught more fiscal responsibility. Credit cards should only be when the money for the purchase is in the bank.

But building a credit history is important. Most people will need to purchase certain things on credit. With a high credit score, you lower your interest rate. So having a good credit history is actually a cost saving and an investment in your future.

Oh and that million your son will have at 65, what will he be going without to make that?

KCDave

Probably the waverunner, fourwheeler, motorcycle, second car payment, boat or numerous other things people buy each year that they can't afford or put before saving.

I think your figures are right on and this is what most of America is doing. Buying way too much with the income they have. There is no way a person making $36,000 a year should be buying a $264,000 home. Thats a home thats 7x their annual income! Most mortgage lenders say it should be 2 1/2x and I think thats high.

I never said it's easy, but this is what we should be teaching our kids. All we teach them now is how easy it is to buy on credit.

I may be talking on the extreme side, but thats what our goals should be. Maybe at first its as simple as saving that $8,000 the first year and paying cash for a decent used car instead of getting that $40,000 Tahoe.

The only thing you would ever need a credit score for is to buy a home and I'm willing to bet if you buy within your means and have a downpayment in the bank and no debt you'll get the loan.

It may seem idealistic or impractical but it's not, I know plenty of average working 40 year old people who are debt free.

Some people can handle credit just fine, most can't, just read the posts on this board.
"collection agency-law firm placed lien on property"
"credit card debt settlement?"
"Too young for bad credit! what to do"
"credit card company using questionable tactics:"
"1999 credit card debt , sued 2007 cali, satute?"

Now go to the retirement board and read about all the people that want to cash in their
401K.