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Advice for weaning your grown kids off your credit cards

Rule No 1: Set an expiration date.


Rule No 1: Set an expiration date.

It’s easy to end up with an adult child on your credit card — and hard to ask them to surrender it.

Ideally, you talk about expectations before you hand your teen a credit card. But, mistakes are to be expected. Leaving their cash in another pair of pants or finding a clearance price on some cute boots can constitute an emergency in a young person’s mind.

Have an expiration date Elaine King, a certified financial planner and founder of the Family and Money Matters Institute in Miami, says it’s best for financial help to be time-limited. She recalls her father giving her a credit card and specifying that it was for emergencies while she was in college. She knew exactly when she would return the card.

Show them how to apply for their own card It can be tempting to delay applying for their own credit cards if they already have access to plastic. But young adults 21 and older who have an income can likely qualify for credit in their own name. This affords them financial privacy and helps them build credit independently.

READ: This is the age when it officially becomes too embarrassing to live with your parents

While it’s easy to wish the young adults had simply stepped up and announced they would take over, Ballou says, it’s not fair. “You can’t really blame them for continuing to accept money when we continue to provide it.”

“Parents can feel taken advantage of when they see adult children going on vacations that the parents have denied themselves,” she says. The parents may also be putting their own retirement at risk.

King says you could offer to pay for half of a vacation, for instance, or even 75%. But the young adult should pay something, she says. “That way, they are making a contribution and not accepting a handout.”

“We want them to experience the same pride in supporting themselves that we have,” Ballou says. Keeping them on the parental dole can undermine that. “Be understanding, but be firm.”

Read more: MarketWatch

Rule 1 of 1: Dont give it to them.

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