Credit card suggestions for my son that lives away from home

February 02, 2023, 11:48 AM

mark123

Normally, we give the boy cash for shopping and entertainment but now that he lives at the group home we don't get the receipts for his purchases on a regular basis. I have to do a guardianship report every March so I need to record every purchase he makes. He does have a debit card attached to his checking account (I keep it) but I don't want him to have access to money at an ATM so no one can ask him to withdraw money.

Shirl and I were considering getting him a credit card but we have some very specific requirements.

Low credit limit (like $200)
No overdraft fees (so no debit cards)
He can only spend what's available on the credit limit (the card gets declined if it goes over)
I get a notification when it's used
I can track the spending online
No annual fees or fees to reload if it's one of those reloadables (I think that's probably something I'd like to avoid, too)

Does anyone maintain a credit card for children at college or away from home that has similar features? So far online everything is dubious on those points.

February 02, 2023, 11:50 AM

SIGnified

I’m pretty sure Frank Abagnale preaches this very thing.

(He did this for his three children at college I believe. They should have good credit when they graduate.)

He also advise against ever using debit. Always use OP money.

February 02, 2023, 12:01 PM

Aeteocles

Chase Bank offers a debit card specifically for children. You own the account, you set limits for spend (even limits for categories), and can set limits for withdrawals at ATMs, and can have notifications and approval requests sent directly to you.

While I normally advise against debit cards because of the time it takes to reverse fraud, this may actually be a better solution in this case.

If you open an account in little Mark's name, and start building him credit, he may in the future be susceptible to undue influence or ID theft attacks. If he has good credit, someone may pressure him into co signing loans, or steal his identity and open accounts in his name without him knowing.

February 02, 2023, 12:26 PM

mark123

quote:
Originally posted by Aeteocles:
Chase Bank offers a debit card specifically for children. You own the account, you set limits for spend (even limits for categories), and can set limits for withdrawals at ATMs, and can have notifications and approval requests sent directly to you.

While I normally advise against debit cards because of the time it takes to reverse fraud, this may actually be a better solution in this case.

If you open an account in little Mark's name, and start building him credit, he may in the future be susceptible to undue influence or ID theft attacks. If he has good credit, someone may pressure him into co signing loans, or steal his identity and open accounts in his name without him knowing.

I see where you're coming from. So, I'm back to just handing him a bunch of cash every week?

February 02, 2023, 12:44 PM

220-9er

quote:
Originally posted by mark123:
quote:
Originally posted by Aeteocles:
Chase Bank offers a debit card specifically for children. You own the account, you set limits for spend (even limits for categories), and can set limits for withdrawals at ATMs, and can have notifications and approval requests sent directly to you.

While I normally advise against debit cards because of the time it takes to reverse fraud, this may actually be a better solution in this case.

If you open an account in little Mark's name, and start building him credit, he may in the future be susceptible to undue influence or ID theft attacks. If he has good credit, someone may pressure him into co signing loans, or steal his identity and open accounts in his name without him knowing.

I see where you're coming from. So, I'm back to just handing him a bunch of cash every week?

Another option might be to do the credit card with all those restrictions and also a credit freeze on new accounts with you holding the password to unfreezing after the account is opened.
That way you have something to keep track and document his expenditures that cash won't give to you.

February 02, 2023, 12:48 PM

1967Goat

Capital One card will satisfy your requirements.

Funny, back in November I applied for a Capital One Platinum card from a mailer I received in the mail. I decided to get it because I only have 1 other credit card, a Chase Marriott Visa from when I traveled all the time. My Chase Marriott card came with a $20k limit when I got it. I rarely use it, and never carry a balance.

I've heard good things about Capital One rewards, so that's why I decided to get it. Well, I get it in December and my credit limit....a whopping $500.

It's insulting. I don't need $20k, but a few thousand might be nice for when we go on vacation. I was going to cancel it, but I think I'll just throw it in my drawer and never use it.

February 02, 2023, 01:01 PM

Aeteocles

quote:
Originally posted by mark123:

I see where you're coming from. So, I'm back to just handing him a bunch of cash every week?

No, sorry. I was unclear.

Normally against debit cards, but in this particular case, the Chase debit card for children sounds perfect.

In this case, the Chase Debit card belongs to you--he can't go to the bank under duress and withdraw money out or change ownership or do anything to the account. He gets a card, and the card has built in parental control over spending limits. Sounds perfect.

I don't have any experience with this particular card, but as a Chase customer I get targeted for ads. The literature says you can set limits for spending categories (e.g. $20 for food, $50 for clothes, etc), have recurring deposits (e.g., a weekly allowance), and get spending notifications automatically. It also has provisions for app based authorizations for spending that exceeds your limits (e.g., he needs to spend on something in particular, and you get a notice that allows you to approve the spend).

This works because the account belongs to you, he just gets a user card. In any other instance, if you open a card "in his name", then he has control over the account.

February 02, 2023, 01:03 PM

SigSAC

quote:
Originally posted by 1967Goat:
Capital One card will satisfy your requirements.

I've heard good things about Capital One rewards, so that's why I decided to get it. Well, I get it in December and my credit limit....a whopping $500. It's insulting. I don't need $20k, but a few thousand might be nice for when we go on vacation. I was going to cancel it, but I think I'll just throw it in my drawer and never use it.

Capital One will send you a notification if you don't use it for about 2 years that it will be cancelled. If you want a higher limit, use it for normal purchases on a regular basis and pay it off monthly.

February 02, 2023, 01:09 PM

mark123

quote:
Originally posted by Aeteocles:
quote:
Originally posted by mark123:

I see where you're coming from. So, I'm back to just handing him a bunch of cash every week?

No, sorry. I was unclear.

Normally against debit cards, but in this particular case, the Chase debit card for children sounds perfect.

In this case, the Chase Debit card belongs to you--he can't go to the bank under duress and withdraw money out or change ownership or do anything to the account. He gets a card, and the card has built in parental control over spending limits. Sounds perfect.

I don't have any experience with this particular card, but as a Chase customer I get targeted for ads. The literature says you can set limits for spending categories (e.g. $20 for food, $50 for clothes, etc), have recurring deposits (e.g., a weekly allowance), and get spending notifications automatically. It also has provisions for app based authorizations for spending that exceeds your limits (e.g., he needs to spend on something in particular, and you get a notice that allows you to approve the spend).

This works because the account belongs to you, he just gets a user card. In any other instance, if you open a card "in his name", then he has control over the account.

Ah, ok. Thanks. I have a Chase Ink for business so I will call them and see about setting up a card for Marky.

February 02, 2023, 01:11 PM

mark123

quote:
Originally posted by 220-9er:
quote:
Originally posted by mark123:
quote:
Originally posted by Aeteocles:
Chase Bank offers a debit card specifically for children. You own the account, you set limits for spend (even limits for categories), and can set limits for withdrawals at ATMs, and can have notifications and approval requests sent directly to you.

While I normally advise against debit cards because of the time it takes to reverse fraud, this may actually be a better solution in this case.

If you open an account in little Mark's name, and start building him credit, he may in the future be susceptible to undue influence or ID theft attacks. If he has good credit, someone may pressure him into co signing loans, or steal his identity and open accounts in his name without him knowing.

I see where you're coming from. So, I'm back to just handing him a bunch of cash every week?

Another option might be to do the credit card with all those restrictions and also a credit freeze on new accounts with you holding the password to unfreezing after the account is opened.
That way you have something to keep track and document his expenditures that cash won't give to you.

Yeah, I should probably put a freeze on his credit report once I get a card for him.

February 02, 2023, 02:20 PM

V-Tail

quote:
Originally posted by 1967Goat:

I've heard good things about Capital One rewards, so that's why I decided to get it. Well, I get it in December and my credit limit....a whopping $500. It's insulting. I don't need $20k, but a few thousand might be nice for when we go on vacation. I was going to cancel it, but I think I'll just throw it in my drawer and never use it.

I got one of those a few years ago. Very low limit, but convenient to use, so I used it and paid the balance in full each month. I never asked them to increase the limit, but every once in a while I would receive an email informing me that they had increased the limit, which is now more than ten times higher than it was originally.