How The Parent’s Bad Credit Affects The Life Of The Child

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Written By Adrian Cruce






Most people think that bad credit just affects them but in reality it can easily have a negative long-term effect on the child. There are many different reasons for that, with the most important facts you have to be aware of being highlighted in the following paragraphs.

Student Loans Can Be Denied

One of the really easy ways in which you can help the child to afford college is to co-sign student loans. That will cause a serious problem from a financial point of view in the event that loan payments cannot be paid in the future but when you really want to help through co-signing, the bad credit score you have can actually stop the entire process. The child will end up having to choose out of limited education options. The only option that remains is the federal student loan.

Establishing A Good Credit Score For The Child Will Be Difficult

During college the young adult starts establishing an independent credit history. It is not difficult but the truth is that what people see as “independent credit history” is not actually independent when it starts. Many credit card companies will ask for co-signer if the applicant is young. Co-signing the card of the child helps in building start credit. If your credit score is bad, the application of the child can be denied.

Children Learn Bad Financial Habits

In many cases bad credit score appears because of very bad financial habits and unfortunately, the family can easily pass the habits and bad money related attitude to children. When the child does not learn how to save, plan and budget from the parent, few schools have something like this in the curriculum. At the same time, you do not show the child that financial stress can be handled in a proper way. The child can even not learn how to talk about financial problems. The good news is that it is never too late to start learning. Even if you do not have financial education, you can start learning together with the child.

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Options Become Unavailable

Extracurricular activities are not going to be cheap. In various situations the parent is not going to be able to instantly afford the price. Credit cards or various loan options are available but in the event the credit score is low, such payment options become unavailable. This means that children that focus on futures involving sports, music and art can end up missing out on various opportunities. There are options available to build an academic resume that is stellar, like free activities, but good credit opens the door to various opportunities the child will surely appreciate.

Home Life Is Negatively Impacted

Bad credit will have a huge impact on your possibility of accessing transportation, work and housing. Although it is not at all a great thing that you are judged by the credit score, it is something that happens. Through bad credit you have problems when you want to get a lease, so living conditions can become unstable. Life is filled with stress with every major financial decision you have to make.

Take Action Now

Although bad credit has serious negative consequences, you can always improve everything. The simple fact that you work hard to improve your credit score is going to offer a great example for the child. What you really have to do is to seriously consider financial counseling whenever you feel that you are way over your head. If you do not do it for you, do it for the children! Your responsibility is going to help the child a lot more than you imagine in the future.

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