In the US, Moms are 3.6 times more likely than dads to give their kid a credit card, according to a new WalletHub survey released today. Parents can make their child an authorized user on their account and give them their own card tied to the parents’ credit line.
Making a child an authorized user can be good way to teach them responsibility and help them build a credit history before they are old enough to have a credit card account in their own name. However, not all parents decide to give their kids a card. Below are a few key stats from WalletHub’s survey:
Key Stats
- 2.4X more daughters have credit cards than sons.
- Kids in private school are almost twice as likely to have a credit card.
- Dads are 3.4 times more likely than moms to monitor their kids’ credit card spending.
Q&A with Odysseas Papadimitriou, CEO of WalletHub:
What is an appropriate age to give one’s child a credit card?
“It’s a good idea to give your child a credit card for emergencies when they are in high school,” said WalletHub CEO Odysseas Papadimitriou. “That’s when young people start to exercise their independence more and more, making access to funds for emergencies increasingly important. Plus, adding your child to your credit card account as an authorized user can help them build some credit history, making it easier for them to get their own account after they turn 18. When they’re eligible to get their own account, set your child up with a secured credit card, and have them fund the security deposit themselves. This will give them good practice without too much risk. But it will be their own money at stake, which is important.”
What explains 2.4X more daughters having credit cards than sons?
“My guess is that parents tend to see their daughters as being responsible enough to handle a credit card at an earlier age than their sons,” said Odysseas. “However, the need for financial literacy is gender-agnostic. And the kids who are least responsible may actually need the most hands-on training.”
Should parents closely monitor their kids’ spending?
“Parents should monitor their kids’ spending, both to keep them safe and because it can provide some valuable learning opportunities. But they shouldn’t try to be sneaky about it,” said WalletHub CEO Odysseas Papadimitriou. “Rather, parents should discuss spending decisions with their children in order to help calibrate how they think about money and improve their financial literacy. Credit cards make this whole process a lot easier than cash.”
A copy of the full report can be found at https://wallethub.com/credit-cards#survey.
