Few people carry cash these days and it seems that the days of throwing change into a jar to accumulate have gone to the wayside. So, does it make sense to get a kids debit card to make their life easier? Or, is it too mature for them?
Teaching kids about finances
Without literally counting their nickels and dimes, how does a child in the 21st century learn about responsible savings and spending? What options are there to learn economic responsibility without making huge mistakes that could affect their long-term financial goals? The solution is a parent-controlled debit card.
Many parents will push back on the idea of giving their child a debit card. It seems so adult, but is anyone too young to learn how to budget or save for the things they want? Read more and let’s take a look at three children-friendly cards to address the pros and cons of a debit cards for kids.
According to the Jassby site, parents want to teach their kids how to be financially literate – but where to start? From budgeting to banking, real-life experiences will guide the way to a “money metamorphosis” through using Jassby tools.
A wise person once said that if you make education fun, your children will never know they’re learning valuable skills. Jassby has an app that helps parents delegate chores to earn funds on their card.
Set an allowance. Track spending. Block access to certain sites or ATMs. Your children can also spend through Jassby Mall or contactless payments using Apple Pay. Also, parents can immediately transfer funds to the card, just in case of an emergency.
One pitfall is that it is only available through an iOS device. So, it is not usable by those who youngsters with an Android smartphone instead of Apple. Hopefully, there will be an expansion to iOS in the future to make it more versatile.
2. Greenlight kids debit card
Like Jassby, Greenlight has parental controls and real-time notifications. Parents can set up an auto-renewal for allowance. Parents can also add funds instantly to the kids debit card for them in those “just in case” moments.
According to their site, 89% of Greenlight parents said it’s helped teach their children financial responsibility. That’s great to hear.
There is a trial period but once it expires, there is a small monthly fee to use their card and service. So, parents do have to allow for that or come to an agreement with kids about whether the fee will come out of their allowance, if they have one.
3. FamZoo prepaid debit cards for kids
What is FamZoo? It is a prepaid card with an associated mobile app that allows parents pay an allowance automatically when the youngsters complete a chore. Like the other debit cards, FamZoo can track spending habits too.
It also has an option to reward your little ones for saving money by setting an interest rate. FamZoo also has mock stocks where kids can practice investing too. Thankfully, parents can put a cap on interest and investment earnings, just in case.
One of the greatest pitfalls of this option is that you can only add cash to the card at a GreenDot or MasterCard rePower location. Another drawback is the monthly fee.
The plus side is clear from the discussion above. No matter which card, service, or app you select, the consensus is that debit cards for kids and teens is a great way to teach them financial responsibility.
By having spending limits or an opportunity to earn, the youngsters are more likely to be more conscientious about their spending. That’s especially ture when they know their card will be declined for insufficient funds.
Welcome to real life!