SECURED CREDIT CARD

We’ve watched the quick rise and fall of the Kardashian Kard, a prepaid credit card that was promoted by the Kardashian sisters, only to be pulled from the market after a few short weeks. So why was this card considered  to be predatory, and even when dealing with legitimate credit products, is it ever a good idea to allow type of card–or even a standard credit card–to be used by children? If so, how young is too young?

Why the Kardashian Kard Was Considered Predatory

Photo by David Shankbone @ Flickr

If they didn’t know by now, the recent release and immediate termination of the Kardashian Kard reminded consumers that their children aren’t safe when it comes to money. No matter how diligent you may be in personal finance, retail businesses will find a way into your wallet, even if it means going through your kids.

If you’re interested in a secured credit card, there are things that you should know before diving in. First, they are meant for people who have less-than-stellar credit and struggle to find an unsecured card that is given to those with good credit histories. Of course, that’s not the whole story behind these cards, so let’s take a look at this quick FAQ to get more details.

Q: Do Secured Credit Cards Require Initial Deposits?

In the past couple of years, more consumers have found themselves challenged by the credit industry. Because they have lost their job or foreclosed on their home, their credit may have been damaged. As a result, they are fighting to repair their credit in time to get a new car or even rent a car. High credit card rates can also hurt people with bad credit.

If you are in this position, then you know how tough it is to prove that you are creditworthy when the damage has already been done. However, by getting your hands on a bank secured credit card, you give yourself a second chance.

When you go to the store to buy groceries, stop at a gas station to fill up the tank, or decide to treat yourself to a little something at the local boutique, chances are you will use a credit card.  This doesn’t always mean that you will have to face your credit card bill at the end of the month.  If you are using a prepaid credit card you can relax knowing that your purchases are paid in full.

Many people believe that giving your child the opportunity of having a first credit card is an important step to your child’s financial development, however, it is important that before you entrust a credit card to your child,  he/she understand the meaning of financial responsibility so that a good credit history can be established.

If you are trying to repair your poor credit history, you don’t need to be told how difficult it is to get a credit card. Even if your financial situation has changed, you may need to prove your creditworthiness before your credit score begins to reflect your changed attitude and circumstances. For a person who is unable get any kind of unsecured card, a secured credit card might be a useful tool to rebuild your credit rating.

The credit card may be one of the most important financial “inventions” of the modern era. Millions of Americans have one – if not two, four, or more. In fact, the average American family has about $8,000 in credit card debt, according to some estimates. Being able to managing credit card payments allow people to build a good credit history and be able to do more thing, such as acquiring a mortgage loan and other big financial lines of credit. If you have developed and maintained a strong credit history over the years you could very well qualify for an unsecured credit card.