This post is sponsored by Chase Slate. I'm part of the Mom It Forward Influencer Network. All opinions are my own. Growing up, I learned a lot of the wrong lessons about credit. Now, we want to make sure that the lessons we're teaching our kids about credit will help them avoid mistakes and be more knowledgeable about credit decisions and scores. And we're not alone. Chase Slate's 2017 Credit Outlook Survey highlights that U.S. Hispanic are optimistic about improving their credit score in 2017. Why not get the kids involved in this process, learning alongside you?
While fewer U.S. Hispanics are satisfied with their credit score compared to all adults, they appear to be more motivated to improve their score in the next year, with many more having a plan than adults nationally. According to the Chase Slate 2017 Outlook Survey, less than half of Hispanics (47%) are very satisfied with their credit score compared to 55% of Americans nationally who have checked their credit score, but 72% of Hispanics would like to improve their credit score and more than half (57%) have a plan to do so. They are more likely to be motivated to check their credit score out of specific financial concerns rather than because the information is provided as a free service.
Learn how transparency with your spouse will change how you teach your kids about credit
Most Hispanics believe that having credit transparency in the couple is important. My dad is Mexican and in our household growing up, I think he was a little bit more progressive for being in the baby boomer generation: he and my mom shared the finances and all of their financial information with one another. It's no surprise that in my own house, my husband and I have complete transparency. We both have logins and access to all of the credit cards, bank accounts, and any other financial information for each other. In addition, we brought our kids into the mix.
Our family loves going on vacations. When I was a kid, we didn't go on many vacations. Most of the vacations we went on were budget-friendly, like camping. I didn't ride on a plane until after I was 18, on my way to Basic Training in the Army. I grew up with this idea that traveling was a very expensive activity, only for the rich to enjoy.
Boy, did I have all the wrong ideas! We've started to travel more, going on cruises and plane rides and even out of the country! We involve the whole family in the planning, from choosing the dates and location all the way to how we're going to budget and pay for the trip. For this recent cruise we took to Mexico, we talked to the kids about how we were using credit cards to finance the expense in a responsible way. I want our kids to know how much things cost and to know how to make it happen on a budget.
How to completely change what we teach kids about credit
As a kid, my parents taught me a lot of lessons about finances. But the lessons I learned about credit were limited and basically boiled down to this: don't get credit cards. Most of the Hispanic side of our family had “bad experiences” with credit cards and blamed them for their bad decisions. Because I didn't know how, why, and when to use credit cards and I certainly didn't know much about credit reports, I actually made a lot of mistakes when I started using credit cards.
It's easy to think that we are protecting our kids by not telling them all the details about our financial situation but if we don't teach them, others will.
We all know that kids model what we as adults do, not just what we say. Educating your kids about credit by discussing it with your kids is one thing but you also need to show good credit practices in action. Your kids will see how you handle store clerks who offer you credit cards, how you make buying decisions when using credit, and what you do to improve your credit score.
As Hispanics, we need to recognize the mistakes our parents made in sheltering us, modeling poor credit use, or any other mistakes that we can avoid with our own children.
3 easy ways to teach your kids about credit
Shop with your kids:
Your kids are going to learn from seeing you in action. When we're out shopping, I want the kids to see how I am paying for groceries and gas and I explain to them why I make those choices. Don't just drag your kids along to the store; get them involved in the process of choosing items, putting them in the cart, tracking the total, and even paying at the checkout. Even in the craft store or when shopping for back to school clothes, involve the kids in making smart credit decisions. Start educating them about credit choices when making purchases you make every day.
Do the bills as a family:
Doing bills is not the most exciting activity you can do and then doing it as a family? Yes, I said it! We go over our bills together so we are all on the same page about spending and so our kids have a realistic idea of what it costs to maintain a household. And that includes looking at credit card bills and credit reports. Use this opportunity, in the privacy of your own home, to discuss what credit scores mean with your kids so they know what credit is all about.
Get your kids a card:
We opened bank accounts with debit cards for both of our kids at Chase. But did you know that your kids can become users on your credit accounts? Now, there is some educating that has to go along with this and some guidelines you want to discuss with your kids, but getting our daughter a credit card was a great decision. She feels more ownership and control over her spending and she is learning about being a good steward with her credit.
You can often set limits on how much they can spend and you can get text alerts when purchases are made. My daughter was recently on a camping trip with my parents and needed to stop for some supplies along the way … I got a text alert with the name of the store she stopped at and the total she spent so I could monitor what was being spent. If you think your child is mature enough for a credit card, talk to Chase Slate about all of the available options.
Find out more about credit and credit scores from Chase here:
What lessons have you taught your kids about credit?