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Establishing Credit at a Young Age Set Your Kids up Right · Earn Your Leisure

• 0:00
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 0:03
  Speaker 1: in Massachusetts. An MS thirteen gang member from Al Salvador
• 0:07
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 0:11
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 0:15
  Speaker 1: some of the heinous migrant criminals caught because of President
• 0:19
  Speaker 1: Donald J. Trump's leadership. I'm Christy nom the United States
• 0:23
  Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
• 0:28
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 0:31
  Speaker 1: one hundred thousand illegal aliens have been arrested. If you
• 0:35
  Speaker 1: are here illegally, your next you will be fined nearly
• 0:39
  Speaker 1: one thousand dollars a day, imprisoned, and deported. You will
• 0:43
  Speaker 1: never return. But if you register using our CBP home
• 0:46
  Speaker 1: app and leave now, you could be allowed to return legally.
• 0:50
  Speaker 1: Do what's right. Leave now. Under President Trump, America's laws,
• 0:55
  Speaker 1: border and families will be protected.
• 0:57
  Speaker 2: Sponsored by the United States Department of Homeland Security.
• 1:00
  Speaker 3: There's the importance of having credit at a young age.
• 1:03
  Speaker 3: Like you said, one of those factors is the credit age, right,
• 1:05
  Speaker 3: and so if we're getting credit at twenty twenty three
• 1:08
  Speaker 3: years old, we've missed some years that we actually could
• 1:11
  Speaker 3: have to talk about the importance of establishing credit at
• 1:13
  Speaker 3: a younger age, maybe talk about authorized users and things
• 1:16
  Speaker 3: like that.
• 1:17
  Speaker 4: Yeah.
• 1:17
  Speaker 5: Absolutely, So for the parents out there, I recommend every parent,
• 1:22
  Speaker 5: if you can, if you have a credit card that
• 1:24
  Speaker 5: you know you're not going to you know, pay later
• 1:26
  Speaker 5: or whatever, and with good history, I recommend to add
• 1:29
  Speaker 5: your child at no later than seventeen.
• 1:31
  Speaker 3: Now.
• 1:32
  Speaker 5: Now, if your child is eighteen, obviously you can add them.
• 1:34
  Speaker 5: But adding your child from the ages of sixteen through
• 1:38
  Speaker 5: seventeen will set them up for when they turn eighteen,
• 1:42
  Speaker 5: they'll already have an established credit profile. Most people don't
• 1:45
  Speaker 5: realize that you do not have a FYCO score just
• 1:48
  Speaker 5: because you turned eighteen. You have to have six months
• 1:50
  Speaker 5: of credit history with at least two accounts before FICO
• 1:53
  Speaker 5: will issue.
• 1:54
  Speaker 4: You a credit score.
• 1:55
  Speaker 5: Right, So, as opposed to just starting at eighteen and
• 1:59
  Speaker 5: building your own credit, if you have a parent, a
• 2:01
  Speaker 5: responsible parent that will put you on their credit card
• 2:04
  Speaker 5: prior at least six months prior to your eighteenth birthday,
• 2:07
  Speaker 5: you'll already start off, you know, a little ahead of
• 2:10
  Speaker 5: the pack, right, so, as opposed to getting those entry
• 2:12
  Speaker 5: level credit cards. Sometimes you can get quality offers because
• 2:15
  Speaker 5: it's really easy to get a seven hundred credit score,
• 2:17
  Speaker 5: especially if you have no collections or you haven't messed
• 2:20
  Speaker 5: up your credit yet, it is super easy to get
• 2:22
  Speaker 5: seven hundred. So adding, if you have the opportunity to
• 2:26
  Speaker 5: be an authorized user on a family member's card and
• 2:30
  Speaker 5: if you share an address with them, it's better because
• 2:32
  Speaker 5: nowadays the anti abuse laws affects out effects trade lines
• 2:37
  Speaker 5: authorized users, and so if you have the same address
• 2:40
  Speaker 5: or the same last name, you'll be more credited for
• 2:42
  Speaker 5: those accounts right or for the yeah, for the authorized
• 2:46
  Speaker 5: user accounts setting once you turn eighteen though, because this
• 2:50
  Speaker 5: is the mistake a lot of parents make. They'll put
• 2:52
  Speaker 5: their child on their credit card at like fifteen, sixteen, whatever,
• 2:55
  Speaker 5: and then whenever they turn eighteen, the child will have
• 2:57
  Speaker 5: like a seven hundred credit score, and as opposed to
• 3:02
  Speaker 5: making the child or having the child apply for their
• 3:04
  Speaker 5: own accounts, they just kind of lean on lian on
• 3:09
  Speaker 5: mom's card or mom's credit history and think that it's
• 3:12
  Speaker 5: going to take them far. And that's where they run
• 3:14
  Speaker 5: into the situation of having a high credit score but
• 3:16
  Speaker 5: not a lot of credit, not a worthy credit credit
• 3:20
  Speaker 5: borrow wing right, So you need to make sure that
• 3:23
  Speaker 5: when that child turns it turns eighteen. Like on my
• 3:26
  Speaker 5: children on their eighteenth birthday, we're going to be applying
• 3:28
  Speaker 5: for a credit card on their eighteen birthday. Because the earlier,
• 3:31
  Speaker 5: the earlier, the better. Apply for a credit card. Please
• 3:35
  Speaker 5: apply for a credit card before a student loan. That's
• 3:37
  Speaker 5: just like a side note, that's one of the things,
• 3:40
  Speaker 5: that's one of the mistakes that I wish that I
• 3:42
  Speaker 5: can catch with a lot of people. Having a credit
• 3:45
  Speaker 5: card be your first established account. Your credit age is
• 3:48
  Speaker 5: going to be reliant on that account. The great thing
• 3:51
  Speaker 5: about credit cards is they can be open forever. Like
• 3:54
  Speaker 5: there is no end date to a credit card unless
• 3:57
  Speaker 5: you choose to close the card or the bank chooses
• 3:59
  Speaker 5: to close the car. Whereas a loan, every loan has
• 4:02
  Speaker 5: a term date. Every loan will end eventually. So when
• 4:05
  Speaker 5: your credit age is based on a loan, once that
• 4:08
  Speaker 5: once that account closes, yeah, yeah, your credit is going.
• 4:12
  Speaker 4: To be affected drastically.
• 4:13
  Speaker 5: Right. So if you have your first established account as
• 4:15
  Speaker 5: a credit card, that's sort of like a safety blanket
• 4:17
  Speaker 5: for your credit age. And so make sure at eighteen
• 4:21
  Speaker 5: apply for a card. It could be a It can
• 4:23
  Speaker 5: be a secure card, it can be a subprime card. Whatever.
• 4:26
  Speaker 5: Apply for a credit card and then start to build
• 4:28
  Speaker 5: your own credit history because authorized users can only take
• 4:31
  Speaker 5: you so far, and not very far.
• 4:33
  Speaker 2: Nowadays, it's a quick fall.
• 4:34
  Speaker 3: Because you did bring up closing cards, and I know
• 4:36
  Speaker 3: a lot of people as they're trying to fix their
• 4:37
  Speaker 3: credit like, all right, well I paid it off, let
• 4:40
  Speaker 3: me close it. About how that could negatively affect.
• 4:44
  Speaker 4: Yeah, it could.
• 4:46
  Speaker 5: My rule of thumb when it comes to closing credit
• 4:48
  Speaker 5: cards is if you have if the credit card has
• 4:50
  Speaker 5: an annual fee and you're not getting any increases and
• 4:54
  Speaker 5: the it's just not worth it to keep it. There
• 4:57
  Speaker 5: will be there will come a time where you'll probably
• 4:59
  Speaker 5: want to close that card. When you close that card
• 5:02
  Speaker 5: is super important.
• 5:03
  Speaker 4: Number one.
• 5:03
  Speaker 5: If you are applying for anything, any large purchase like
• 5:07
  Speaker 5: a car or home within the next six months, it's
• 5:09
  Speaker 5: not the time to close that card.
• 5:11
  Speaker 4: Close it after you get your car, your home, whatever.
• 5:14
  Speaker 5: The only time I would suggest you closing the credit
• 5:16
  Speaker 5: card is if you if you know, like I said,
• 5:18
  Speaker 5: six months free of any applications, and also make sure
• 5:22
  Speaker 5: that you have another card before you close that card,
• 5:26
  Speaker 5: Like do not like I see people all the time
• 5:28
  Speaker 5: like I just hate this card, I want to close it, etc.
• 5:30
  Speaker 5: And it's just like that's going to do more harm
• 5:32
  Speaker 5: than good. I have a two hundred dollars Capital one
• 5:35
  Speaker 5: card that I've had since college. That card is still open.
• 5:38
  Speaker 5: I haven't gotten an increase in years. I don't even
• 5:40
  Speaker 5: care to use the card. I keep it open. Specifically
• 5:42
  Speaker 5: because credit age. An aged credit card is the most
• 5:47
  Speaker 5: beneficial thing that you can have on your credit report,
• 5:49
  Speaker 5: that like the most and it's one of those things
• 5:52
  Speaker 5: that's like the gift that never never stops giving because
• 5:55
  Speaker 5: every single three to six months that a car ages,
• 5:57
  Speaker 5: it's going to add more to your credit and also
• 6:00
  Speaker 5: your fical points. So keep that in mind.
• 6:03
  Speaker 3: So don't earners, what's up. You ever walk into a
• 6:07
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• 6:47
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• 7:13
  Speaker 3: This episode is brought to you by P and C Bank.
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  Speaker 3: A lot of people think podcasts about work are boring,
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• 7:55
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 7:59
  Speaker 1: in Master An MS thirteen gang member from Al Salvador
• 8:03
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 8:07
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 8:11
  Speaker 1: some of the heinous migrant criminals caught because of President
• 8:15
  Speaker 1: Donald J. Trump's leadership. I'm Christy Noman, the United States
• 8:19
  Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
• 8:23
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 8:27
  Speaker 1: one hundred thousand illegal aliens.
• 8:29
  Speaker 2: Have been arrested.
• 8:30
  Speaker 1: If you are here illegally, your next you will be
• 8:34
  Speaker 1: fined nearly one thousand dollars a day, imprisoned, and deported.
• 8:38
  Speaker 1: You will never return. But if you register using our
• 8:41
  Speaker 1: CBP home app and leave now, you could be allowed
• 8:44
  Speaker 1: to return legally. Do what's right. Leave now. Under President Trump,
• 8:50
  Speaker 1: America's laws, border and families will be protected.
• 8:53
  Speaker 2: Sponsored by the United States Department of Homeland Security, I'll.
• 8:56
  Speaker 5: Close the car, and unless you have to, if you
• 8:59
  Speaker 5: have a car that you don't use, put a subscription
• 9:01
  Speaker 5: on it. I have Netflix, like use one, use pick
• 9:04
  Speaker 5: one of your subscriptions that you probably have coming out
• 9:06
  Speaker 5: of your bank account. Assign those to each of you know,
• 9:09
  Speaker 5: each of your credit cards so that it can have usage,
• 9:12
  Speaker 5: so the bank will not close it due to non usage.
• 9:16
  Speaker 2: So what about putting your child on the credit card?
• 9:19
  Speaker 4: Yes, as a child, Yeah, for I.
• 9:21
  Speaker 5: So the one of the things that people think that
• 9:24
  Speaker 5: makes some difference is if they add their child at
• 9:26
  Speaker 5: like twelve or thirteen. That doesn't make it regardless if
• 9:29
  Speaker 5: you add your child at twelve or if you add
• 9:31
  Speaker 5: them at seventeen, it will not make a difference in
• 9:34
  Speaker 5: terms of the effect that it will have on their
• 9:36
  Speaker 5: credit reports.
• 9:37
  Speaker 4: That's a misconception.
• 9:38
  Speaker 5: However, me personally, I would suggest, like I said, adding
• 9:42
  Speaker 5: your child at like seventeen when you when someone asks
• 9:45
  Speaker 5: their child at thirteen, to me, it just that's a
• 9:47
  Speaker 5: that's that's what seven years seven eight years until they
• 9:51
  Speaker 5: turn eighteen, and that's a lot of room. It leaves
• 9:54
  Speaker 5: a lot of room open for a mistake. What happens
• 9:55
  Speaker 5: if you get a lay payment on their card, and
• 9:57
  Speaker 5: now your child's credit will be a f before they
• 10:00
  Speaker 5: can even establish credit. So we never know what can happen, right,
• 10:04
  Speaker 5: so I just for I just recommend, like I'll personally,
• 10:08
  Speaker 5: I'm adding my children at one day turn seventeen. As
• 10:11
  Speaker 5: long as you have six months before they turn eighteen,
• 10:13
  Speaker 5: they're fine.
• 10:14
  Speaker 3: I was a beneficiary of that, so I was added
• 10:18
  Speaker 3: to my mom's I told the story before, but I
• 10:20
  Speaker 3: was added to my mom's American Express card at six seventeen.
• 10:24
  Speaker 3: And so now even when I get the cards, it'll
• 10:26
  Speaker 3: say members since eighty five, even though I was born
• 10:28
  Speaker 3: in eighty two, but my credit history goes back that far,
• 10:31
  Speaker 3: so it's over thirty seven years. So every time I
• 10:34
  Speaker 3: get a new card, it gets averaged into that. Yeah,
• 10:37
  Speaker 3: so I think when I mean that's a blessing, it
• 10:39
  Speaker 3: was a blessing, and that it's still a blessing. Actually
• 10:41
  Speaker 3: I still have the card because I just want that
• 10:43
  Speaker 3: history because sure that thirty seven years plus a one
• 10:46
  Speaker 3: they average, it makes it like sixteen years of credit age.
• 10:50
  Speaker 3: So I'm like that works perfectly.
• 10:51
  Speaker 5: In American Express is a huge relation bank like indeed,
• 10:55
  Speaker 5: man having a long stand of relationship with them, you
• 10:58
  Speaker 5: can get anything.
• 10:59
  Speaker 2: This is true.
• 11:00
  Speaker 3: But we talked about the number seven hundred, and it's key,
• 11:03
  Speaker 3: and I don't want people to you know, some people
• 11:05
  Speaker 3: may not have seven hundred, but it feels like that's
• 11:08
  Speaker 3: the goal. But there are people like, what are the
• 11:11
  Speaker 3: numbers that in the range that people should be trying
• 11:13
  Speaker 3: to get to seven hundred.
• 11:15
  Speaker 2: Seven to fifty? I know we got some eight fifties
• 11:17
  Speaker 2: out there.
• 11:18
  Speaker 4: Yeah.
• 11:18
  Speaker 5: So I'm a little different when it comes to credit scores, right,
• 11:22
  Speaker 5: because I know the scoring model and how much your
• 11:24
  Speaker 5: credit profile matters. Most people don't believe me when I
• 11:29
  Speaker 5: say I had over one hundred thousand dollars in credit
• 11:32
  Speaker 5: card limits before my score was seven hundred, right, And
• 11:34
  Speaker 5: it was simply because I learned how to set up
• 11:37
  Speaker 5: my credit profile that will that far past my credit score.
• 11:42
  Speaker 5: There's a lot of time there's a lot of people
• 11:44
  Speaker 5: who have over seven hundred and still can't get approved
• 11:46
  Speaker 5: for over ten thousand dollars twenty thousand dollars right because
• 11:48
  Speaker 5: their borring power does not match their score. So I
• 11:52
  Speaker 5: don't ever recommend a specific score. What I will say is,
• 11:57
  Speaker 5: like I always say, a healthy profile will translate if
• 11:59
  Speaker 5: you people need to focus on their credit profile more,
• 12:03
  Speaker 5: meaning making sure you don't have any lay payments. If
• 12:05
  Speaker 5: you do have lay payments, try to rectify those. If
• 12:09
  Speaker 5: you have collections, try to try to rectify all of
• 12:12
  Speaker 5: your credit issues.
• 12:14
  Speaker 4: Make sure that you have at least.
• 12:16
  Speaker 5: Four accounts open at all times, like after you begin
• 12:20
  Speaker 5: to build credit. There should never be a time where
• 12:21
  Speaker 5: your credit profile goes below three open account or goes
• 12:25
  Speaker 5: below four open accounts any time. Regardless, you can have
• 12:28
  Speaker 5: an eight hundred credit score. If you do not have
• 12:30
  Speaker 5: at least four accounts open, any application that you do,
• 12:34
  Speaker 5: you're going to get what's called an empty profile penalty, right,
• 12:38
  Speaker 5: and we don't see this as consumers.
• 12:40
  Speaker 4: We can't see this on our credit score or our
• 12:43
  Speaker 4: credit report.
• 12:43
  Speaker 5: However, when it comes to lenders and how our credit
• 12:47
  Speaker 5: reports are assigned and how they translate over to their system,
• 12:53
  Speaker 5: if you have less than three accounts open, four accounts open,
• 12:56
  Speaker 5: then regardless of your score, you automatically penalize. You're automatically
• 12:59
  Speaker 5: moved moved down to a lower tier of borrowing power,
• 13:03
  Speaker 5: multiple tiers rather, So that's going to be more important.
• 13:07
  Speaker 5: Making sure you're not applying for a let's just say
• 13:12
  Speaker 5: an American Express card if you have just opened up
• 13:15
  Speaker 5: two other credit cards in the last six months, right,
• 13:18
  Speaker 5: So those are the things that.
• 13:19
  Speaker 4: Speaks more to like your approval.
• 13:21
  Speaker 5: Now when it comes to score, if I had to say,
• 13:23
  Speaker 5: I would say six.
• 13:25
  Speaker 4: Eighty and above.
• 13:26
  Speaker 5: You pretty much with a healthy profile, you pretty much
• 13:28
  Speaker 5: can get anything since eight six eighty and it's super
• 13:33
  Speaker 5: And the thing is, it's so And I know this
• 13:34
  Speaker 5: probably sounds far fetched to a lot of.
• 13:37
  Speaker 4: People, but it's so easy to get a six eighty.
• 13:39
  Speaker 5: Like I actually tell people, if you don't have at
• 13:41
  Speaker 5: least a six fifty, then usually one of three things
• 13:45
  Speaker 5: are the case you had a recent collection within eighteen months,
• 13:48
  Speaker 5: a recent aid payment within twenty four months, or you
• 13:51
  Speaker 5: have high utilization, Because as long as you don't have those,
• 13:54
  Speaker 5: you at least you should at least have a six fifty,
• 13:56
  Speaker 5: just in terms of how your credit scores, how our
• 13:58
  Speaker 5: credit scores are allotted.
• 14:00
  Speaker 1: An illegal alien from Guatemala charged with raping a child
• 14:03
  Speaker 1: in Massachusetts. An MS thirteen gang member from Al Salvador
• 14:07
  Speaker 1: accused of murdering a Texas man of Venezuelan charged with
• 14:11
  Speaker 1: filming and selling child pornography in Michigan. These are just
• 14:15
  Speaker 1: some of the heinous migrant criminals caught because of President
• 14:19
  Speaker 1: Donald J. Trump's leadership. I'm Christy nom the United States
• 14:23
  Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
• 14:28
  Speaker 1: crossings are at the lowest levels ever recorded, and over
• 14:31
  Speaker 1: one hundred thousand illegal aliens have been arrested. If you
• 14:34
  Speaker 1: are here illegally, your next you will be fined nearly
• 14:38
  Speaker 1: one thousand dollars a day, imprisoned, and deported.
• 14:42
  Speaker 4: You will never return.
• 14:44
  Speaker 1: But if you register using our CBP home app and
• 14:47
  Speaker 1: leave now, you could be allowed to return legally. Do
• 14:50
  Speaker 1: what's right. Leave now. Under President Trump, America's laws, border
• 14:55
  Speaker 1: and families will be protected.
• 14:57
  Speaker 2: Sponsored by the United States Department of Homeland Security.