In the United States, people under the age of 18 cannot legally enter into any contracts without a co-signer, but what about the increasing number of parents who are getting credit cards in their children’s names? Do minors really need access to credit cards?

It’s really a decision that is unique to each family. The most common reasons parents may decide to get a credit card in the name of their child include:

For emergencies Letting the child (probably a teenager) do their own school shopping Purchasing lunch and other necessities while out with friends For traveling (perhaps the child visits family members regularly)

When you are deciding whether or not to get your child a credit card, you’ll want to think about their age and maturity level. An elementary school student has very limited knowledge of what money is and how people get money. On the other hand, a teenager often has a better concept of how money is earned and what it’s used for, and could be taught appropriate use of a credit card.

Many parents like the idea of getting their teenager a credit card in order to start teaching them about financial responsibility. If this is your goal, then obviously you don’t want to hand the credit card to your child and let them have at it! You’ll need to spend some time discussing the reasons for the child to have a credit card, set limits, and discuss how payments will be made with the card. Will your teenager be responsible for paying back the charges made to the card? If so, be sure you and your child discuss this as well.

Alternatives to Credit Cards

What parents may want to consider instead of an actual interest-bearing credit card is a debit card. Setting your teenager up with a bank account with a debit card teaches them to spend money they actually have, rather than spending money and paying for it later. It is up to you how the bank account itself is funded, but some parents have set up “direct deposits” for their children’s allowance- which the child accesses using their debit card.

A “Charge Card” is another good option for the younger crowd. While they can be used to charge purchases, you cannot carry a balance from month to month on the card and must make the payment in full each month. This will teach your child responsibility for “charging”- provided you don’t just pay it off each month for them without some discussion or maybe requiring the teenager to use their part time job or babysitting money to make the payments.

If you decide you want to get a credit card, charge card, or debit card for your own child, be sure you look into the rules of such an account with the provider you want to go with. Some credit card companies restrict the “additional cards” to people of a minimum age; while others allow anyone of any age to be the secondary card holder. Same goes for charge cards. For debit card accounts, there are banks that offer youth checking or savings accounts with debit cards that are specifically geared to the needs of teenagers. That might be your best option for instilling financial responsibility in your children.

How to Use Credit Cards, Charge Cards or Debit Cards to Teach Financial Responsibility to Children

When getting a card issued in your child’s name, it’s important that you spend some time with the child teaching them the basics. Don’t take for granted that they will already have this knowledge. If the goal is to use the cards for teaching financial responsibility, here are some things to consider:

Teach your children not to lend their cards to friends for any reason Review bank statements together monthly and compare receipts with purchases made on the statement Teach children to pay more than the minimum payment – and teach them why that’s important! Discuss what a credit score is and how it affects people in life

The comfort and security of knowing you can see a doctor whenever the flu strikes or when you’ve broken your leg on the ski slopes is a privilege that many take for granted. Whether you have to select health insurance through your job or need to choose an independent company, there are plenty of factors that can affect your final decision. Weighing the pros and cons of various options is the best way to choose the health insurance that will accommodate your needs as an individual or family. Below are a few points to consider as you search for the best health insurance plan for you:

Know Your Choices

There are many different kinds of health insurance plans offered to the public. Knowing the various options you may qualify for will help satisfy your needs in the future. There are five type of health plans to consider: traditional indemnity, health maintenance organization (HMO), Preferred Provider Organization (PPO), Point of Service Plan (POS), and Health Savings Account (HSA). You should familiarize yourself with each option.

Know the Advantages and Disadvantages

Out of the five main types of health insurance plans, each one contains their own set of advantages and disadvantages. For example, with a traditional indemnity plan, individuals seeking complete freedom in the medical providers they can select should choose this option. But freedom comes with a price; the insurance plans produce higher rates and costs. This means individuals will face few restrictions, but also have to cope with no financial incentives that lessen patient financial responsibility.

Coverage and Benefits

An important factor to consider when choosing a health insurance plan includes the type of benefits offered and whether or not they will accommodate your needs. Some of the coverage capabilities to ask about include maternity, prescription, childcare, immunizations, emergency visits, and annual checkups.

Costs

Seeking information on the premium or employee contribution associated with a particular health insurance plan is important to make an effective decision. The cost you are responsible for will depend on the type of plan you choose; the deductible, coinsurance and co-payment; lifetime maximums, and the limitation of plan benefit coverage.

Are You Considered “Hard to Insure?”

If you are labeled as a “hard to insure” case, you may not find the most cost-efficient or accommodating health coverage. A few things to keep in mind include: avoiding lifetime maximums of less than $500,000, straying from plans that only offer hospital and surgical benefits, seeking out an HMO plan that tend to be the least expensive, and researching health insurance coverage provided by professional organizations, school alumni programs or unions.