Helping our children build good credit

Ensuring our children's success is a priority for all of us. In today's challenging housing market, it's essential to position our kids for future homeownership.

Here are 8 steps to helping children build good credit

1. Start early
2. Teach the difference between a debit card and a credit card
3. Incentivize saving
4. Help them save early for a secured credit card
5. Co-sign a loan or a lease
6. Add your child as an authorized user
7. Have them report all possible forms of credit
8. Encourage them to apply for a student card

Let's go more in depth on step 6.

Adding your child as an authorized user is an effective strategy for initiating their credit history before they reach 18. Typically, children aged 13 to 15 can qualify, and some issuers have no minimum age requirement. Verify with your issuer that their activity will be reported to credit bureaus for maximum benefit. Once added, they can independently use the card for purchases and access benefits like airport lounge entry. Many cards, such as the Capital One Venture X Rewards Credit Card, waive additional fees for authorized users. However, it's crucial to educate them on responsible card usage by examining statements together. Trust and clear spending agreements are vital, as adding them can impact your credit score.