Is your college-age child finding it difficult to get a credit card? Many students face a catch-22 when applying for their first card. Some card companies market their products specifically to students, yet the students often get rejected when they apply. Why? Insufficient credit history. If you don't have credit, many companies won't extend credit to you. Thus, the dreaded credit catch-22.



If you're a parent who is concerned about your child's credit score, take heart. Here are five strategies for getting them started down the path to good credit.

Car Loans

Teenagers eventually need cars, and it often falls to parents to provide those cars. But the teens should be involved in the paperwork, too. One of the simplest (and most overlooked) ways to start building your child's credit is to get them to co-sign for their car loan. Once their name is on the contract, they will begin to receive credit for timely car payments.

Your Own Cards

If your child is trustworthy, you can add them to your own credit card accounts. Any credit history associated with your credit cards will then influence your child's credit score.

Bank Cards

Start a checking or savings account for your child while they are in their early to mid teens. Make sure that the accounts maintain a positive balance. Then, by the time your child is ready to head off to college, they will already have a positive history with their bank. This can be very beneficial, because banks will often issue credit cards to clients who have proved, over time, to be financially responsible.

Retail Cards

Like bank cards, credit cards from retail stores are relatively easy to obtain. Try to select a store that your child will shop at, but not one where you think they might be tempted to spend beyond their means. Make sure your child understands that the key to building a good credit history is to charge a small amount every month, then pay off the balance in full.

Secured Cards

Secured credit cards are another option for teens and young adults who are trying to build up their credit. These cards are secured by a deposit made by the card holder into an account that is set up specifically for this purpose. Then, if the card holder doesn't make their payments, the card issuer can take the money they're owed out of that account. Since this significantly reduces the risk to the issuer, banks and credit card companies will issue secured cards to applicants who might not qualify for non-secured cards.

With a little pre-planning and strategic thinking, you can have your child's credit up and running in no time. Whichever card you and your child decide to go with, emphasize to them the importance of not carrying a balance, lest they get mired down in fees, penalties and interest. Your child might think you're nagging, but since when has that stopped a good parent from getting their point across?