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New Visa card gives parents teen control

Updated: May 3, 2013 12:14PM

Originally published: August 29, 2002

College credit used to be a way of counting class hours. Now it’s become a way of counting students’ personal debt. Almost every student has a credit card--78 percent of all college students carry at least one card, and the average amount owed is $2,748 according to, a Web site that helps compare the best credit card deals.

But are students learning the most important lesson: Not only doesn’t money grow on trees, it doesn’t grow on credit cards, either.

With parents and students pending a lot of money on school supplies and clothes in this season, it’s a perfect time to teach your kids some lessons about spending and credit.

And there’s a great way to get started.

Visa has come up with a new type of credit card--the Visa BUXX card--that solves kids’ needs for a way to carry their money safely and parents’ needs to control where the teens do their spending.

Reloadable debit card

The Visa BUXX card is a reloadable debit card. That is, parents deposit money into an account, and the teen card user can charge up to the amount that’s available in the account. Parents can add more money on a regular basis for an allowance or whenever the money runs low. That’s easily done by transferring money from the parents’ checking account or their own regular credit card. And it’s a great way for grandparents to send birthday money instead of a check. They can also add to the account balance online.

The student gets the convenience of credit with an automatic spending limit. The card can be used anywhere a Visa card is accepted. And it can be used to withdraw cash from an ATM.

But the best part is the fact that students and parents can track spending from this account online, using a secure Personal Identification Number. That means Mom and Dad know exactly where the money is going.

If the college student calls home complaining about the cost of books and supplies, but the parent sees money spent on clothes or at the campus bar and grill, you can be sure there’ll be a confrontation.

Parents can cancel or suspend the card at any time. And parents can sign up for an e-mail alert when the card is used at a merchant that might sell inappropriate materials for teens. That gives some real control over these independent teens.

There’s an educational component to this Visa BUXX card: a workbook and online quiz that parents can use to teach their children about spending and credit. It’s a perfect tool to start teaching teens about tracking spending, setting priorities, and managing money using spending limits. Plus, it’s a lot safer for them to carry a credit card than cash.

Online tracking of expenditures

The key to this program is online tracking of spending. You have to sign up for the card online at That Web site will answer all your questions, as well as giving you direct links to each of the five national banks that offer these cards. Most charge only about $15 per year for the card. It will only take a minute to apply. No credit check is necessary because parents are putting up the money to fund the account.

We live in an unusual world where kids are granted credit even before they have earnings to justify their ability to repay. College students are an obvious target, because marketers figure they’ll go on to get good jobs. Or their parents will bail them out.

If you don’t want to face that prospect in the future, start teaching your children about the wise use of credit right now.

This is the perfect way to get started on a lesson that will last a lifetime.

And that’s The Savage Truth.

Terry Savage is a registered investment adviser and is on the board of directors of McDonald’s Corp. and Pennzoil-Quaker State Co. Send questions via e-mail to She appears weekly on WMAQ-Channel 5’s 4:30 p.m. newscast.

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