How to Build Your Child’s Credit

We recently wrote a post about freezing your child’s credit report in order to avoid identity fraud, but what if you want to help your child build good credit from the start? Can you open up accounts in your child’s name, build that credit, and still protect your child from potential identity theft?

Where to Begin

A gift of excellent credit is one of the best things that you can give to your child. There are a few ways to help your child create a great credit report including the following:

  • Allow your child to become an authorized buyer on your credit card. Even though you will be responsible for paying for all purchases, you will help to build your child’s credit when paying off all balances in full. This is one of the easiest ways to show your child how to handle credit responsibly as well.
  • If your child is old enough, you can cosign on a credit card for her. All people under the age of 21 must have a cosigner according to the law, so this is the perfect opportunity to help your child build credit while also displaying responsibility credit-wise.
  • If your child is not old enough for a credit card of their own, you can also open up a store credit card under your child’s name - again, you will have to pay the bill (or work out an arrangement with your child), but these cards provide a good way to build credit quickly.

Protecting a Small Child

Identity thieves don’t discriminate when it comes to identity theft - they will go after the credit of a child at any age. Even if your child is too young to open up a credit card account, there are still some things that you can do to protect your child’s credit.

  • Always check your child’s credit report - twice or three times per year. If you see anything strange, make sure to report it right away.
  • Open a credit account with a major credit reporting company like Equifax for your child. Then, freeze the account until your child is ready to build her own credit (see the previous article for these details).
  • Make sure that you report anything suspicious right away. It can take time and there might be a process to it, but acting quickly when you see that something is not right about a credit report is important. For more details about how to report identity theft, make sure to read our next post.

Help Now

If your child has become a victim of identity theft, and you can’t get anywhere with reporting fraud, make sure to contact the Dellutri Law Group today. We can help!