Credit Card for 18 Year old

[cashmax]

I'm trying to help my Daughter to get a credit card and build up her credit score as well as get the benefit of the protection they offer over a debit card. She is in full time employment, with a salary of circa 20K, lives at home and has a phone in her name. The options appear to be very limited for someone young with no history, wondered if anyone else had recently been through this and had any tips?

[TwigtheWonderkid]

I encouraged both my lads to get a credit card at 18, and as they both bank with Halifax, they applied for and got a Halifax Visa Card (I think it was Visa) no problems. They just use it on TFL (we're in London) and always clear it off each month, about £250 a time. Any other expenditure goes on the debit card, unless it's something where they need the additional protection.

Has she applied for her own bank's card?

[Somebody]

TwigtheWonderkid said:

Has she applied for her own bank's card?

This. Also try a credit builder card like Aqua.

[n3il123]

Also make sure she is on the electoral roll as that will help her cause.

[Panamax]

n3il123 said:

Also make sure she is on the electoral roll as that will help her cause.

^^^ This.

It's definitely essential in the real world for kids to try to get a credit card the day they turn 18. Most importantly IMO they need to be taught to,

• Use the card regularly, and
• Pay it off IN FULL every month.

[_Rodders_]

Capital One when I was 18. £200 limit and a ridiculous APR but that didn't matter to me. Got a proper one soon after once I could.

[AB]

20 year old in our office just got an AMEX, I think it's a chargecard rather than a credit card, but for the same reason.

Has to be paid off each month.

[Simpo Two]

Boo-urns said:

Genuine question here: Is having a credit card really essential? I'm 33 and have never had one (apart from a corporate AmEx), and my credit score is 975 - 'Excellent', according to Experian. Never had a problem getting a mortgage etc.

Am I missing something? Would I stand to gain anything by getting a credit card and improving that score?

If you don't need credit you don't need a credit score.

But a CC can be useful for the protection it brings in disputes or when companies go bust.

[anonymous-user]

Panamax said:

^^^ This.

It's definitely essential in the real world for kids to try to get a credit card the day they turn 18. Most importantly IMO they need to be taught to,

• Use the card regularly, and
• Pay it off IN FULL every month.

Why? Last thing I want when my children get to 18 is for them to have a credit card. If you only spend the money you have then you don't need one.

I have one, I very rarely use it, I only use it if I order something over £100.

[outnumbered]

Joey Deacon said:

Panamax said:

^^^ This.

It's definitely essential in the real world for kids to try to get a credit card the day they turn 18. Most importantly IMO they need to be taught to,

• Use the card regularly, and
• Pay it off IN FULL every month.

Why? Last thing I want when my children get to 18 is for them to have a credit card. If you only spend the money you have then you don't need one.

I have one, I very rarely use it, I only use it if I order something over £100.

The key part is "Pay it off IN FULL every month." You can do this with a direct debit. That way you gain a whole lot of consumer protection on every purchase that the CC company has to pay for, with absolutely no downside to you. Even better if you get a cashback/other benefit type of card. I get a few hundred quid cashback every year from mine.

[cashmax]

Thanks for the comments. The main reason for a credit card in my view is the consumer protection they provide. I just don't understand why anyone would not want that. Of course, paying it off monthly renders the APR a complete irrelevance.

[Panamax]

Yes, consumer protection - and also in this crazy modern world it seems to be essential to build up some sort of positive credit record, whether or not you ever actually need to use the available facilities.

Good discipline for young-uns to learn that just because you have the ability to spend borrowed money doesn't mean you have to.

[Funk]

Get her registered on the following:

https://www.moneysavingexpert.com/creditclub/
https://www.clearscore.com/
https://www.creditkarma.co.uk/

MSE Credit Club allows you to see your full Experian credit file for free, Clearscore gives you your full Equifax credit file for free and Credit Karma will show your TransUnion for free (they used to be Noddle). You can also register direct with Experian, TransUnion and Equifax directly but they'll want a monthly subscription if you want to see anything other than just a 'score'. Experian, Equifax and TransUnion are the three main credit reference agencies.

The reason MSE Credit Club, Credit Karma and Clearscore can show the full report for free is because they make money from then referring people through for credit card, finance and loan applications etc. But the handy thing here is that your daughter will be able to see which credit card companies are most likely to offer her a card (she may even be pre-approved) which prevents having several hard searches on her file in a short space of time (and which might not be successful).

I keep an eye on scores every couple of months and make sure nothing's appeared on there that shouldn't have done!

Edited by Funk on Monday 30th January 16:16

[cashmax]

Funk said:

Get her registered on the following:

https://www.moneysavingexpert.com/creditclub/
https://www.clearscore.com/
https://www.creditkarma.co.uk/

MSE Credit Club allows you to see your full Experian credit file for free, Clearscore gives you your full Equifax credit file for free and Credit Karma will show your TransUnion for free (they used to be Noddle). You can also register direct with Experian, TransUnion and Equifax directly but they'll want a monthly subscription if you want to see anything other than just a 'score'. Experian, Equifax and TransUnion are the three main credit reference agencies.

The reason MSE Credit Club, Credit Karma and Clearscore can show the full report for free is because they make money from then referring people through for credit card, finance and loan applications etc. But the handy thing here is that your daughter will be able to see which credit card companies are most likely to offer her a card (she may even be pre-approved) which prevents having several hard searches on her file in a short space of time (and which might not be successful).

I keep an eye on scores every couple of months and make sure nothing's appeared on there that shouldn't have done!

Edited by Funk on Monday 30th January 16:16

Thanks - did this and the first thing discovered is that she's not on the ER, which can't be helping things.

[Funk]

cashmax said:

Thanks - did this and the first thing discovered is that she's not on the ER, which can't be helping things.

Yeah, that is a significant factor!

She can register here: https://www.gov.uk/register-to-vote

I'd also personally opt out of being on the 'open register' when she registers.