What High-Schoolers and College Kids Need to Know About Credit

Blog - Know About Credit

Companies are aggressive when it comes to marketing to teens celebrating their 18th birthday or heading off to college. Is your kid ready to tackle credit without you present to make financial decisions? If not, it is time you prepare your high-schooler or college kid for credit. Here are the things they must know about credit before going off to college or applying for their first card.

Budgets are a Must

High school kids and college kids don’t have a lot of money to spend, but they must keep track of what does come in and go out. The first step to tracking is creating a budget with your teen. Then you can teach your child how to track the spending. Kids spend blindly, which means parents are left with the bills at the end of the month. Help your teen learn how to create a budget and manage spending before you send them off to college. Free online and mobile banking services tied to a UNITY checking account help teens keep track of their cash.

Employability is Tied to Your Credit Score

It may not sink in right away, but kids need to know that their employment after high school and college is tied to their credit score and their credit report. This is a lesson that will probably resonate more with college students than high school students, but it doesn’t hurt to compare the employment – or lack thereof – options with good credit and bad credit.

Blog - Know About Credit - College Students

5 Factors Influence Your Credit Score

Not many adults know exactly how the reporting agencies track and determine credit scores, which means teens know even less. The five factors that affect a credit score are your payment history, amount of debts, the types of credit account you have opened, inquiries for new credit, and the length of your credit accounts. So, the more accounts you have, the more you owe, and the more you fall behind and miss payments, the worse your credit score is.

You Can Build Credit Slowly

When teens turn 18, they don’t have any credit, which isn’t exactly the same as having bad credit. Having no credit does, however, mean a young adult needs to take steps to establish credit. They can do so with a secured credit card. Secured credit cards allow young adults to make a deposit on a credit card, which has a low spending limit, and make payments to pay it off quickly. The secured credit card helps your teen budget, control spending, and build credit with little risk. But, credit cards that aren’t paid back, or if they are maxed out, can have the exact opposite effect.

Savings Protects Your Credit

Every man, woman, child, and teen needs to know how to save. The fact is, most people aren’t saving. Almost half of Americans would struggle to come up with $400 in a pinch, according to the Federal Reserve. As incomes stopped growing, people went into deeper debt, and spending climbed, savings tumbled. When people don’t save, they can end up with deep financial troubles, especially young adults. Open a savings account and teach a teen to save, if even just a little money, so they develop a savings habit to protect themselves from future challenges that can wreak havoc on their credit.

Parents, teens, and young adults need to know they have resources at their disposal. OneUnited Bank has financial literacy tools and products to ensure high school kids and college kids are off to a good start when they apply for their first credit card or head off to college.

OneUnited Bank

Our community’s dream is now a reality! OneUnited Bank is fulfilling the hundred year old civil rights dream by garnering the savings power of our communities and channeling it back into urban communities for economic development. With your support by simply opening an FDIC insured account with great rates, we will continue to accomplish this dream everyday!

  • Diana Clark
    Is this bank black own
    July 3, 2016 Reply
  • Lauren Hardee-Chase
    Where can your financial highlights and annual reports be found?
    July 13, 2016 Reply
  • Denice Roach
    what product or product do you recommend for a high school sophomore?
    July 14, 2016 Reply
  • Angel Mahan
    Have you considered expanding into other markets? What criteria do you use to decided whether a market is viable or not.
    July 14, 2016 Reply
  • Carmela
    Hello! I am a sophomore in college and like many I have had to take out loans to pay for my education. Could I still qualify for a secured credit card to build my credit or how to go about building my credit with your company perhaps.
    July 18, 2016 Reply
  • Vanessa
    What is the monthly fee for the saving account if you do not align a monthly direct deposit to the account?
    July 19, 2016 Reply
  • Andrea D. Edwards
    I am from Oregon and would like to open an account with a black owned and operated bank, but I do not believe we have any here. I have been searching online and have not been able to come up with any. I belong to First Technology Federal Credit Union here in Portland, Oregon. My family has been with this CU for over 30 years now. I will be on vacation sometime in August so I will either join online or visit the LA branch.. It is time for a change.
    July 20, 2016 Reply
    My name is BOBBY J from Dallas TX, I have been a member of this bank for 2 years,I have a checking and saving account with them, the bank Is outstanding never had any problems .for them to not have a branch here in Dallas this bank is on key point.they have the most professional customer service when you have to call for questions. This is what our communities needs,to talk about saving and building wealth.together we can do this ,open up accounts at this bank You want be sorry
    July 22, 2016 Reply
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    July 28, 2016 Reply
  • Kaila
    If I'm 16 and have a job, can I get a credit card to start building a better credit score?
    July 29, 2016 Reply
  • Mark D.
    Is One United traded on the Stock Exchange? Can members invest in the company?
    August 1, 2016 Reply
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    How to increase my credit limit say it again
    August 4, 2016 Reply
  • Teresa Dover
    I have truly been ignorant to this and I'm a 55 year old woman. Now this is great news and I'm lookin forward to becoming a part. P.S. Thanks
    August 4, 2016 Reply
  • Quadre Stephens
    Does the bank offer refinancing options for auto loans? I only see home loans.
    August 13, 2016 Reply
  • Kenneth Williams
    Greetings, I'm from Ohio and I was interested in opening up a business account. Can I do it online? I was unsure if I can. Also if not, with process do I implement to open a business account. My interest is a LLC and/or Unincorporated Association.
    August 16, 2016 Reply

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