In the United States, having a healthy credit history is essential for buying a good, studying, renting, or even getting a good job; However, since last year, credit scores among Americans have fallen below 700, with Generation Z being one of the most affected.

According to FICO data, Generation Z borrowers have had difficulties maintaining their credit scores, as many factors are currently influencing them, such as high interest rates, the high cost of living, increased debt, and stricter credit requirements.

According to the analysis, nearly 14% of younger borrowers saw their credit scores drop by up to 50% in just one year. For this reason, it is important for parents to educate their children on how to build a good credit record.

In this regard, Alma Morales, a financial expert at Bank of Texas, comments that “applying for their first credit card is an important step in any young person's financial life, since it helps them build a credit history and learn to manage their expenses, but without good guidance, it can also lead to debt,” she said.

In this sense, the specialist mentions some tips for parents on how to use their children's credit cards safely, projecting it to a future investment:

Establish a monthly expense

Although credit cards are a great help, in the case of young people, Morales recommends establishing a budget, this way they will not exceed the credit limit.

Pay the full balance

The specialist indicates that children should be instructed to pay the full balance of their credit cards each month, rather than the minimum payment, as this will help build a good credit history. It's important to teach them to regularly review their account statements and avoid late payments or other unforeseen events.

Use them in case of emergency

While the healthy use of credit cards among young people is encouraged, the most advisable thing, according to the Bank of Texas financial expert, is to use them only in cases of emergency and not for discretionary expenses that can lead to unnecessary debt.

Do not accept cards in stores

According to Morales, there are establishments that offer credit cards with gifts or discounts, but the trick behind this is that the interest rates are usually higher, the ideal is to refrain from using them.

Finally, the specialist points out that "before your children have access to a card, it is essential that they understand how credit works. A card is not extra money: it is a tool that requires responsibility."