How Can I Help Build My Kid’s Credit So They Have a Strong Start?
How Can I Help Build My Kid’s Credit So They Have a Strong Start?
Why Credit Matters Early On
Building a good credit history is one of the most powerful tools your child can have for financial independence. Credit affects everything from buying a car or home to getting a job or securing insurance. Helping your child build credit early gives them a head start on making smart financial decisions and avoids common pitfalls that come from starting too late.
Add Them as an Authorized User
One of the easiest and most effective ways to begin is by adding your child as an authorized user on your credit card. This means they get a card in their name tied to your account. While they don’t have to use it, your on-time payments and low balances can begin building their credit profile. Make sure your credit card company reports authorized users to the credit bureaus, as not all do.
According to Experian, this strategy can start building credit history as early as age 13, depending on the card issuer. https://www.experian.com/blogs/news/2022/12/how-to-build-credit-for-your-kids/
Open a Joint Account or Co-sign a Loan (When Appropriate)
As your child gets older and has some income of their own, you can co-sign a small loan or help them open a joint credit card. This gives them direct responsibility while still benefiting from your established credit. Be cautious here—if payments are missed, both of your credit scores can take a hit.
Joint accounts and co-signed loans are best used when your child is ready to take responsibility and has had some basic financial education.
Teach Good Habits Early
Before your child gets access to credit, help them understand the basics:
Only charge what you can afford to pay off in full.
Always make payments on time.
Keep balances low to maintain a good credit utilization rate.
Avoid applying for too many accounts at once.
Even if they’re not using credit yet, practicing good financial habits early builds the foundation for responsible borrowing later.
Consider a Student or Secured Credit Card
Once your child turns 18, they may be eligible for a student credit card or a secured credit card, both of which are great tools for new credit users. A secured card requires a cash deposit as collateral and works like a regular card. If used responsibly, it builds a solid credit history over time.
Sites like NerdWallet and Investopedia offer great breakdowns of the best starter credit cards available and how to choose the right one:
Final Thoughts
Helping your child build credit doesn’t mean throwing them into financial responsibility unprepared—it means guiding them with the right tools and habits so they can grow into strong, independent borrowers. Starting early gives them the confidence and credibility they’ll need later in life when it’s time to buy a car, rent an apartment, or qualify for a mortgage.
