It reports to the three credit bureaus.

• This is the most important factor, because you can only build credit if your payment history shows up on your credit report. This is why a debit card doesn’t work to build credit; you’re using your own money, so nothing is reported to the credit bureaus.

  There are three credit bureaus: Equifax, Experian and TransUnion. Your ideal card reports to all three to make sure all your bases are covered. When you go to apply for an auto loan, for example, you won’t know from which credit bureau the lender will use to pull your credit report. If your credit card only reports to Equifax, and the auto loan lender pulls from TransUnion, the lender won’t have a complete picture of your credit history.

• It allows you to set spending limits

  If you plan to add your teen as an authorized user to your own card, you’ll probably want a feature that allows you to limit their spending. Not only does it prevent your teen from going on a spending spree, it protects you in case the card gets in the wrong hands. Older teens may appreciate this feature, or preset alerts, as a way to help keep their spending at a reasonable level.

• It has few fees

  Before applying for a card, you should carefully read its terms and conditions to make sure it doesn’t include a lot of hidden fees. Cards aimed at applicants with a limited credit history can sometimes charge account set up fees, annual fees and monthly maintenance fees that can amount to more than $100 per year. Fortunately, there are many beginner credit cards with no annual fees, which make great cards for teens.

  You should also be aware of penalty fees, including late fees and returned payment fees. Fortunately, these fees can be avoided if you pay your bill on time and in full, especially if you set up automatic bill pay.

  For college students who want to travel or study abroad, look for a card that doesn’t charge a foreign transaction fee. While the usual fee of 3% seems small, when it’s charged multiple times over a week or a year, that amount adds up to a significant number.

• It allows an authorized user at a lower age

  Since credit cards aren’t issued to minors, the best way to help your teen build credit is to add them as an authorized user on your credit card. Many credit cards allow this, but the age requirement for the authorized user varies between issuers. If you’re opening a new credit card with the intent to add your child to your account, look for a card that has the lowest age requirement. This will allow your child to build credit from age 13 rather than 16.

A teen credit card is one that a young adult can be added to with the intent of using and building credit responsibly. Unlike debit cards for teens, there are no specific credit cards for teens because a child under 18 cannot enter the legal contract required for opening a credit card. However many credit cards allow an adult to add a teen as an authorized user. The age at which a teen can be added as an authorized user varies by card issuer. Even adults under 21 will need a parent or other responsible adult to co-sign for a credit card.

Who can get a teen card?

Young adults who are 18 and older can apply for their own credit card, but if they are under 21, a co-signer is typically required. Teens under 18 can often be added to an adult’s credit card as an authorized user.

Each card issuer has its own rules regarding the age of authorized users. Check with the credit card issuer to see their age requirement and verify whether or not they report authorized user accounts to the credit bureau.

Having a credit card is a major privilege; what a teen does with their card — either responsible or irresponsible use — can set a financial trajectory that can stay with them for years to come.

There are several types of cards that teens and young adults can consider to start building credit:

Beginner credit cards: Credit cards for beginners have low credit score requirements, if any. Some even allow you to get a credit card without a Social Security number (SSN). The downside is that they are generally low-frills when it comes to sign-up bonuses and intro APR offers.

Student credit cards: The best student credit cards come with no annual fee and allow you to apply even if you have no credit history. You may earn rewards but remember to charge only what you can afford to pay when your balance comes due.

Secured credit cards: For young people who don’t qualify for an unsecured credit card, a secured card may be an option. You generally need to send in a security deposit to act as your line of credit. It’s refundable if you close your account in good standing or move up to an unsecured card from the same issuer.

It’s normal to have reservations about allowing teens to use a credit card. But, just like learning to drive, using credit is an important part of growing up and provides an opportunity for learning and developing good financial habits.

• Teens can develop responsible financial habits with credit cards. If you help your teen manage their first credit card, you can teach them to handle credit responsibly. Setting a spending limit for an authorized user is a good way to ensure they don’t overspend. Also involve them in checking the balance and paying the bill so they can see where the money is coming from.
• Credit cards help establish a credit history for big purchases down the road. A strong credit history helps get better interest rates when it comes to getting a car loan or a mortgage. A LendingTree study found that those who have very good credit save nearly $50,000 in interest on a mortgage than those with fair credit.

• Credit cards can be useful in an emergency situation. A credit card can also come in handy for emergencies like having to pay additional expenses while away at college or unexpected car repairs.
• Credit cards can be more useful and safer than cash. Credit cards are a convenient payment option that come with useful protections such as zero-liability for unauthorized purchases. These protections can make credit cards a safer bet than using cash or a debit card. When a teen goes on an overnight trip to an amusement park and takes a handful of $20 bills and loses them, the money’s gone for good. But if your teen loses a credit card, you likely won’t be out any money. As long as you report the lost card, its zero liability protection should cover you.
• You can earn rewards with credit cards. Everyone loves rewards and many teen credit cards are also rewards credit cards. Cardholders earn rewards from their spending which are accumulated as points, miles or cash back. Points and miles come with a variety of redemption options, including cash, statement credits or gift cards.

Credit cards are not necessary for teens, and while they are useful, they do come with risks that parents and teens may prefer to avoid. The following options are good alternative payment methods, but it’s important to remember that none of these can help you build credit.

• Prepaid card: Banks and credit card issuers readily sell prepaid cards that resemble a mashup of credit card and gift card. They can be used almost anywhere cards are accepted and aren’t tied to a certain retailer. These can be used online or in stores and are generally issued by Visa or Mastercard. They may have some security features, but it’s best to treat these as cash; if you lose it, your money is gone.
• Debit card: A debit card is linked to your checking account, which means your own money is withdrawn from your account whenever you use it. Unlike cash, a debit card gives you the convenience of paying with a card, without the risk of building up debt from overspending. However, know that if a debit card gets in the wrong hands, you will be responsible for charges, and you may not be able to recover the money that was withdrawn from your account. Each bank has its own policy on how it handles investigations and reimbursement of the funds in question.
• Cash: Cash is a great first teaching tool to help teens and kids understand how money works. Unlike a card, which looks and feels the same no matter how much you use it, as you spend a $100 bill, the amount in your wallet reflects the purchases you make. However, cash can be easily lost or stolen and you can’t use it for online purchases.

To select the best card for each of these categories, our credit card experts compared student, secured and unsecured credit cards designed for individuals with limited or nonexistent credit on LendingTree.com and issuer sites.

We chose our top picks based on a variety of factors, including the value of the card’s rewards program, the annual fee and the interest rate. Other factors that come into play when making our selection include the benefits offered by the card, as well as the opportunity to increase your credit line or improve your credit score.

For Capital One products listed on this page, some of the above benefits are provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply