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Everyday Ways to Teach Teens About Credit

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Everyday Ways to Teach Teens About Credit


Among the variety of financial literacy topics, credit is one of the most important. In fact, of the 2,205 high school students who completed the Center for Financial Empowerment’s classes last year, 78% of them indicated in surveys credit was the #1 thing they wanted to learn. And it’s no wonder since credit mistakes can cripple a person’s financial health for years.

The Center for Financial Empowerment, the nonprofit founded by SCE Credit Union, partners with high schools to teach students smart money and credit skills. We encourage parents to reinforce lessons about money and credit at home, giving kids the best foundation possible for a lifetime of financial success.

Here are some practical ways parents can help teens learn about credit.

teach teens credit

Get basic

In the simplest way, explain what credit is and how important it is to use it responsibly. Avoid using jargon or complicated terms, and don’t feel like you need to tell them everything at once. Help them understand credit can be helpful or harmful, depending on how it’s used. A young person should demonstrate they can be disciplined with their spending before using credit.


Show and tell

Use your own credit strategy to teach your teen. Explain what loans you have and how you manage the payments, how you maintain a positive credit score, and what you value in a credit card. Even if your credit isn’t the best, don’t be afraid to use your situation as a lesson for your teen! Explaining your credit missteps and how you’re fixing them can be a very effective learning opportunity for your teenager.


Go online

It’s easy to find reputable credit information online. The Consumer Financial Protection Bureau (CFPB) and myFICO are good places to start. Also check out the Credit Union’s Learning Center for some great online resources.


Make it real

Give your teen a small loan and let them make payments over time. Be sure to draw up a simple contract with the terms of the loan and a payment plan they can stick to. If they run into trouble making payments, let them know they can negotiate a plan to get back on track. This helps them get familiar with the creditor/borrower relationship.


Make it fun

Who can forget the classic SNL skit, Don’t Buy Stuff, or the “green scarf” scene in Confessions of a Shopaholic. These are fun ways to start conversations with kids, and their thoughts may give you some insights into their understanding of credit and spending.

The key to teaching teens about credit is to talk about it often! The more you have those conversations, the better prepared your teen will be to handle credit and debt responsibly.

Help us empower the next generation for financial success!
The Center for Financial Empowerment is a 501c3 nonprofit organization whose mission is to empower disadvantaged youth through financial literacy education. Find out more about our work at