Should Teens have Credit Cards – No

The answer has to be no.  Credit card debt among teenagers is growing, and this is in no small part to a society that seems to offer ‘free money’ to those who can ill afford to pay back what they owe. The average APR {Annual Percentage Rate} on credit card is around 16.3 per cent, but there are cards with APRs higher than that, in some instances 30 to 40 per cent, for those with bad debt records. By looking at those figures one can clearly see how a teenager can, and very usually does, end up in massive debt.

Some may say that teenagers who apply and own a credit card, will gain independence, and a responsibility about how they manage their money. And, no doubt, with some teenagers, this will always be the case.  Yet more and more do we see young people, who have never applied for a credit card before, being urged by credit card companies,and banks – through the post or on the phone –  to apply.  Banks and credit card companies know full well that young people are the customers of the future, and so haggle between themselves to get as many teenagers as possible to apply. The aggressive way that financial institutions target teenagers has been condemned nationwide, but still the practice continues.

Of course the temptation is always there, and what teenager can turn down the offer of free money?  But, of course, it is not ‘free money’ at all. Many young people – and indeed adults too – fail to realize this. They sign the contract without really reading the small print pertaining to what they have just signed. If you are a teenager, do you really know and understand your APR that is on your card when you receive it? 

Do you know that the money you spend now with your card you will have to pay back in full at the end of the month?  Do you realize that you will accrue charges if you are late with your payment? Have your parents explained to you fully, your responsibilities in owning a credit card?  These are the questions that have to be asked, and should be asked, when it comes to teenagers who want to apply for a credit card.

Teenagers should not be allowed to apply for credit cards, and financial institutions should not be allowed to target and bombard young people to sign up with them {either canvassing through the phone, or through the post}.Why should teenagers who have their whole life ahead of them start life out by being in debt?  And debt is what they will be in when they find out that the money they spend certainly will have to be paid back, if not by them, then their parents.

There are very few teenagers, {as is borne out by the sheer numbers of those who ring up helplines begging for assistance}, who are responsible when it comes to owning and using a credit card. Indeed, many young people have been hounded so much by financial institutions who want their money back, that they have been on the bring of suicide because of the debt that they owe.  Debt is on the increase and it is growing at an extreme rate, yet financial institutions continue to target those who are most vulnerable in society.

There is a fine balancing act here that has to be played out very carefully. On the one hand we want our young people to be able to have that responsibility of handling money. We want our young people to be responsible in paying off what they owe when they use their card. We certainly do not want to take that sense of independence away from any young person.

But, it has to be stated that very few young people are sensible when it comes to credit cards.  Indeed, very few adults are either, but until those young people have reached an age where they can reasonably make that decision to apply for a credit card, then parents should be very wary about their teenagers owning one.

Debt is one of the biggest causes of stress leading to chronic depression and suicide, and credit cards do not make things any better. Yes they can be a great thing in the right hands, helping to pay off items without carrying hard cash in your pocket. But a credit card in the wrong hands can become a fearsome destructive weapon.

This is especially so when teenagers believe that the money is theirs, without realizing the responsibility that goes with owning a card.  Banks and credit card companies have their rolls to, to play in this too, yet they still continue to target aggressively our young people.
Until stringent laws are introduced that would make it illegal for banks and credit card companies to aggressively-target youngsters, then credit card debt among teenagers will continue to rise at an alarming rate. Also, until the majority of teenagers are more responsible in owning and using a credit card, then the answer has to be no, they should not have – or be able to apply for – a credit card.