{"id":93207,"date":"2023-02-05T15:00:50","date_gmt":"2023-02-05T15:00:50","guid":{"rendered":"https:\/\/awardwallet.com\/blog\/?p=93207"},"modified":"2026-04-08T13:45:47","modified_gmt":"2026-04-08T13:45:47","slug":"credit-card-for-teens","status":"publish","type":"post","link":"https:\/\/awardwallet.com\/credit-cards\/credit-card-for-teens\/","title":{"rendered":"What Teenagers Need to Know About Getting Their First Credit Card"},"content":{"rendered":"

Editor note: Kennedy Miller is a 16-year-old writer and artist who has been writing and sharing her travel and financial wisdom since 2016 in publications including Business Insider and Points With A Crew. It\u2019s never too early to start becoming financially savvy. In this post, Kennedy shares advice for her fellow teenagers about what to know and do to prepare to get their first credit card.<\/em><\/p>\n

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Credit cards can be very confusing. There are so many things to learn about them. Even though I personally don\u2019t have a credit card, my family has taught me a lot about them and finance in general. I\u2019m a teenager myself, but I already know a lot about credit cards. There are a lot of things to know, but I\u2019m going to share my experiences and break it down for you.<\/p>\n

What Teenagers Need to Know About Credit Cards<\/span><\/h2>\n

Credit cards are not free money. Just because you cannot see the money you\u2019re using to pay doesn\u2019t mean it\u2019s not there. When you use a credit card, it\u2019s like giving the bank an “IOU.” You\u2019re saying that you will pay the bank back for this purchase later.<\/p>\n

Another important thing to know about credit cards is that there\u2019s a limit to how much you can spend. This is called a credit limit. If you go to that limit, it\u2019s called maxing out your credit card. Maxing out your card is not a good thing. It means that you have more bills to pay, and it can really hurt your credit score.<\/p>\n

What is a Credit Score?<\/span><\/h2>\n

One of the most important things about credit cards is their effect on your credit score.<\/p>\n

A credit score tracks how often you pay your credit card and other bills on time. The more you pay on time, the better your score will be. Your payment history is the number one factor that makes up your credit score. Making late payments or missing payments lowers your credit score.<\/p>\n

When you apply for new debt like a home mortgage, student loans, or car loans, the lenders will look at your credit score to see how reliable you are with paying your debt. If your credit score is good, you are more likely to get approved for the loan.<\/p>\n

If your score isn\u2019t very good, lenders might suspect that you aren\u2019t good at managing your credit. That means you will be less likely to get approved for the loan. You might still be approved for the loan. However, the lender might charge a higher interest rate, meaning you will have to pay more money over the course of the loan.<\/p>\n

Learn more:<\/strong> A Beginner's Guide to Building Healthy Credit<\/a><\/p>\n

What Parents Can Do to Help<\/span><\/h2>\n

Navigating \u201cadult stuff\u201d can be really confusing for teenagers. It\u2019s a good idea to ask your parents for help. After all, they\u2019ve been doing this for a lot longer than you.<\/p>\n

I think one of the best things parents can do to teach their teenagers about credit is give them opportunities to use credit in the real world. One way to do this is for your parents to add you as an authorized user<\/a> on an established account.<\/p>\n

When you\u2019re an authorized user on someone else's card, it means your name is on the card, but you don\u2019t have a legal obligation to pay the credit card bill. When your parents pay the bill, it will help establish a good credit history for you. On the other hand, if your parents pay the bill late, it might hurt your credit score.<\/p>\n

What to Know about Interest<\/span><\/h2>\n

Do you think interest is interesting?<\/p>\n

If you don\u2019t, you probably should. Interest can be a part of your life for good or for bad. When you take out a loan, you have to pay interest if you miss a payment. If you keep missing payments, all that interest can add up to a lot of money — sometimes totaling more than your original payment.<\/p>\n

It\u2019s always a good idea to pay your credit card bill in full, each and every month. You do have an option to only make the minimum payment. However, if you do that you might end up paying hundreds of dollars more before you pay off your purchase.<\/p>\n

As one example, say you make a $1,000 purchase with a credit card that has an 18% interest rate. If you only make the minimum payment of $25 each month, it will take you more than nine years to pay off your debt. You\u2019ll also end up paying over $900 dollars in interest in addition to the $1,000 purchase.<\/p>\n

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Interest isn\u2019t all bad though.<\/p>\n

If you put your money into a savings account, you can earn interest on your savings. Basically, the bank is paying you to put your money there. They want to use your money to make loans to other customers, so they\u2019ll pay you with interest.<\/p>\n

Learning about interest is a very important thing to know, because it is such a vital part of loans, and managing money.<\/p>\n

How to Use a Credit Card Responsibly<\/span><\/h2>\n

Credit cards can be dangerous when not used responsibly. I understand that this can sound scary and make you afraid of using a credit card, but it\u2019s really easy to learn about credit cards and how to use them properly. Credit cards are relatively simple \u2014 it\u2019s just important to remember that credit cards don\u2019t equal free money.<\/p>\n

I like to think of credit cards not as just a little piece of plastic in my pocket. I think of them as actual money. This helps to keep me grounded. When I imagine actual money being there and having to pay it back later, it keeps me from spending unnecessary money.<\/p>\n

Best Credit Cards For Teens<\/span><\/h2>\n

There are so many options for what kinds of credit cards to get. But some cards are specifically better for teens and first-time credit card applicants. Here are a few examples:<\/p>\n