It’s time to send the new high school graduate off to college, and things are tight financially. The offers of credit that come rolling in are tempting, especially to the new adult in the family. The credit trap is just waiting for someone to make a pitfall, maybe your child.

How do you keep them from making a mistake that could ruin their credit history or a few years or more? There is no way to guarantee they won’t fall into the trap, but if you teach them how to make good choices and use wisdom in their decision of whether to use credit or not, the whole family will be better off.

Here are some tips to help keep things under control, and avoid those pitfalls:

• If you can’t afford it, don’t buy it.
• Respond to or apply for only offers that have low interest rates. Some credit card companies even offer a zero interest rate for young adults for the first 3-6 months.
• Only use a small percentage of the actual credit offered. If you use very little credit, and pay off your balance each month, you are establishing good credit history. This can be very beneficial when it comes time to take out a bigger loan, such as for a car or a house.
• Make your payments on time. If you are late, more fees will be added to your monthly balance. This will also go on your report as having a history of late payments. Creditors don’t look favorably at reports of late payments.
• Only accept one credit card to begin with. If you use one, and use it wisely, you will establish a routine of paying on time. You will be charging just enough to make your credit history look good, and when the time comes if you need more credit, you will be able to get it.
• Take advantage of reward systems. Some credit card companies offer rewards for buying things such as food, books, gas, or other necessary items on credit. They offer points, frequent flier miles, or cash back incentives.

If you help your child to know how to establish good credit, there are many resources on the Internet. Take advantage of what is available. You could even offer to help them establish a good payment plan, including teaching them how to set up a bank account and automatic withdrawal of the funds for payments.

Helping your kids avoid credit pitfalls will go a long way. It will help them become responsible adults, live a life of greater ease in the real world, and have a bright future with good credit.
In the long run, the benefits of establishing good credit far outweigh the consequences of hitting a pitfall.