One of the most important things that you can do as the parent of a teenager is to make a concentrated effort to assist your teen in establishing his independence in a safe and intelligent way. When it comes to finances, this means helping your teen to develop good habits with employment and money so that he can always have that strong foundation of financial stability. One of the key things that will come up as you help your teen with this part of life is the situation of getting that first credit card.

Credit cards are a very important part of life today even for youngsters. In order to be able to secure good loans in the future, the teen has to start establishing good credit from an early age. Unfortunately, getting a credit card as a teenager is also risky because it opens up the potential for making serious financial mistakes that can damage credit for years to come. As a parent, you need to be active in guiding your teen to make good credit card choices. The first of these choices will be which credit card to get.

The important thing to keep in mind here is that your role as the parent of an aging teenager is to offer suggestions, advice and insight without making decisions for your teen. If you were to select a credit card for your teen, he wouldn’t develop the skills necessary to choose good credit cards down the line. Instead, you want to assist your teen in determining what a good credit card is so that he is actively involved in the selection of the card and can learn the skills that will help him make those good choices later when he’s financially on his own.

Sit down with your teen and discuss the things that you personally would seek in a good credit card. Make sure to discuss the importance of factoring in personal spending styles when choosing a credit card. For example, you may consider a low interest rate to be important when choosing a credit card. However, you may know that your teen is likely to make late payments and therefore that a card which doesn’t penalize for this is a better choice even if it has a higher interest rates. In discussing these things, make sure that you offer plenty of opportunity for your teen to insert input into what makes a good credit card and what factors should be considered in choosing one.

Your teen may act as though he doesn’t want your advice about things in life but the truth of the matter is that he does seek some guidance from you. There are going to be many controversial issues that come up between you and your teen but choosing a good credit card together doesn’t have to be one of them. Use this opportunity to really assist your teen in establishing a good foundation of financial skills while also building your relationship together. This will prove useful immediately as well as in the long run.

When you are looking to get a new credit card, one of the first things that you are going to look for is a low interest rate. Everyone is basically aware that a low interest rate is an important criterion for a good credit card because it generally reduces the amount of money that you pay for borrowing funds on a credit card. While it’s certainly important to keep this in mind as you choose a credit card, it’s also important to be aware of the fact that there are times when the low interest rate on a credit card doesn’t really matter. Sometimes, there are going to be other benefits of a card that can outweigh the drawbacks of a higher interest rate so that you wouldn’t necessarily choose the low-interest card from the credit card options available to you.

The first thing to realize is that the interest rate on a credit card typically only matters if you are planning to carry a balance on the card. Many people make use of the credit card as a convenient method of making payments for daily expenditures while keeping monthly finances concisely organized. These people often pay off the credit card balance in full each month because they aren’t using the credit card to borrow money that they don’t have but are instead using the credit card to simplify their financial lives. Those people who are consistently going to pay off the entire balance of a credit card at the end of each billing cycle are people who really don’t need to worry about a low interest rate because they aren’t being charged interest anyway.

Another thing to realize when it comes to interest rates and choosing your credit cards is that the low interest rate is only valuable on big expenditures if it’s going to be a permanent or long-term low interest rate. For example, many people try to find a low interest rate on balance transfers so that they can consolidate a big chunk of debt into an easier-to-pay-off loan. In this case, the low interest rate is important but it’s only going to be useful if it lasts long enough to make it possible to pay off at least a large percentage of the consolidated loan before the low interest runs out. In other words, it’s nice to lower your interest rate from 15% to 10% but if the lower interest rate only lasts six months and then climbs to 20% then it probably wasn’t a good idea in the first place.

Finally, it’s important to realize that a low interest rate is only one critical factor that you’re going to want to look at when you are assessing the credit card that is right for you. You’re going to sometimes find that the other benefits of a card may outweigh the fact that it has a higher interest rate than other choices, a fact which may depend upon your particular spending style. For example, let’s say that you don’t carry a very high balance on your credit cards but you tend to be disorganized with your finances and often incur late fees. A credit card without late fee penalties might be a good choice even if it has a higher interest rate than other cards that you’re considering using. Weighing factors in addition to low interest rates is important when selecting a credit card for regular use.

There are many different things that you’re going to take into consideration when you’re trying to get a credit card. You’re going to want to review the interest rates on purchases, balance transfers and cash advances so that you can choose the card with the best deal. You’re going to want to compare rewards programs so that you can get the most back for the money that you spend. And you’ll want to factor in specific perks and drawbacks for each card. You probably already know all of this. What you might not know is that the most important thing that you can review and consider before choosing a credit card is your own financial personality.

There are benefits and flaws to each credit card that is out there. The key is to know enough about yourself to understand which credit cards are going to play to your own financial strengths and minimize your financial weaknesses. Here’s a look at some of the most common financial personalities and the cards that are right for them:

• Impulsive / Indulgent Spending. This is the kind of person who doesn’t tend to plan well regarding spending. Instead, they’ll engage in frequent impulse buys or treat themselves to big expenses they can’t afford. The important thing to look for in a credit card here is low interest rates on purchases. This is more important than rewards or balance transfer rates because where you really spend a lot of money is on the immediate buy.

• Planned spending. In direction opposition to the person who loves impulse buys is the person who plans out every expense. If you’re the type to stick to a budget then you can benefit from credit cards that offer long-term plans. Rewards cards are perfect, especially those that are linked to savings account or investment plans. Since you probably already pay off your card in full each month, the interest rate won’t matter as much here.

• Disorganized spending. Sometimes you pay your bills on time and in full. Sometimes you forget that your bills are due until the utilities start shutting off. The credit card for you is the one that doesn’t penalize you a lot. Look for cards that let you avoid high late fees and over-limit fees.

• Inexperienced with spending. Some people don’t have problems so much because they’re disorganized as because they’re young and not yet used to paying bills. If you fall into this category, you should look for credit cards that are going to teach you to be smart with your finances. Student credit cards are ideal if you’re in school. The no-credit credit card may also be an option.

• Specific spending. Some people are so habitual that they always spend their money in the same few places. If that sounds like you, then you’re going to want to look for rewards cards that emphasize that spending. If you always spend on gas, get a gas rewards card. If you’re a frequent traveler, look at travel rewards. Alternatively, look at cards that offer double points back on your top areas of spending.

If you know what kind of financial personality you have, you’ll know which credit cards you need.

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