What happens if your older teen moves out and gets a credit card? We all hope that he will use it effectively and will pay off the bill each month. All those years of talking to your child about handling his money has made a difference. In that scenario, credit cards are a great tool for money management.
But...what if your teen spends the limit of the card and can't pay it? If he ignores it, then he will find himself dealing with debt collectors. Does he know what to expect with debt collection? What are fair and legal debt collection practices? What practices are shady and illegal? I have realized that this needs to be part of what I teach my teens. I hope that they never get themselves into a debt collection scenario but having the knowledge to handle the situation is crucial.
Jason at FrugalDad.com recently posted an excellent infographic detailing the American debt collection practices, legal and illegal. Thanks, Frugal Dad, for letting us share this information.