Once you have a credit card, you have a credit history and a credit score
It's a parent's job to teach their kids that a credit score is something to be valued and protected. A credit history is a file kept on you and your spending and payment history at the three major credit bureaus: Trans Union, Equifax and Experian. That history is digested by a company called Fair Isaac and converted into your credit score, which ranges from 350 to 800. The closer you are to 800, the more responsible a consumer—and an individual—you are considered to be. Very few people have a score below 500. A score of 660 or more is good. A score of 720 or more is great. People with good and great scores enjoy some valuable benefits. They are able to get credit cards, mortgage and car loans with lower rates of interest. They are able to get better deals on homeowners and auto insurance. They are more easily able to rent apartments and get jobs because, these days, landlords and employers check credit scores as well.

You can keep your credit score up by...
  • Paying your bills on time (that means the payment lands before it's due, not even one day late).
  • Making sure you are not even close to maxing out your credit cards (using no more than 30 to 40 percent of your credit limit is best).
  • Cultivating longstanding relationships with your creditors.
  • Eventually showing you're able to pay off a variety of creditors including auto lenders, utility providers, even your cell phone provider, without fail.
Make checking your credit a habit
Everyone is entitled to a free credit report from each of the three credit bureaus each year. To get yours (or to encourage your kids to get theirs) go to Then pull one credit report from Trans Union. Four months later, pull Experian. Four months after that, pull Equifax. Then repeat the cycle. Keeping tabs on your report will insure you haven't been a victim of identity theft.

Did You Finish the Other 5 Steps to Raising Money-Savvy Kids?
Step 1: Stop spoiling your kids
Step 2: Give an allowance...then make it work
Step 3: Make saving and investing a habit
Step 4: Teach your children to work
Step 5: Teach your children to give 


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