As teenagers approach adulthood, many parents see this as the perfect time to teach responsible money habits. They might open a bank account for their teens, or require that their teenagers get a part-time job. Both actions can teach kids the value of money, as well as teach them how to budget and save.
Along with this financial education, some parents toy with whether to introduce their teenagers to plastic. On one hand, they might feel that cash is the safest method of payment at this stage in life. But on the other hand, some parents feel that it is important to get older kids into the habit of managing plastic. Teens who learn how to manage credit under the guidance of their parents typically make wiser credit decisions in their adult years. But there’s an even bigger decision – a prepaid credit card or a real credit card.
Each parent has to decide what’s best for his own kid, and several factors should be considered, such as the age of the kid and his level of responsibility. Fully understanding key differences between a prepaid credit card and a credit card can help you make the best choice.