Consumer Watch: How to help your teen build credit

OKLAHOMA CITY (KOKH) — Some parents opt to work on their kid's credit score way before adulthood. The length of credit history is a key part of what makes up your credit score, so it can open some doors, but it's not without risk.

Credit scores can help get you a lot of things, including a better mortgage rate, low interest rates on a car loan, and credit cards.

“I still have my first credit card from early in college, and I will never close it for that reason because I don't want to shorten my credit history,” says Andrew Schrage with Money Crashers, a personal finance site.

Schrage says it is a great idea to help your kids build their credit score, but you must focus on financial responsibility too. If you are giving a kid a credit card or debit card, make sure they are using it properly.

Another possible problem is the increased risk of identity theft. Talk to kids about ways to protect themselves, like only spending what they can pay off every month, and regularly checking their accounts to catch identity thieves early.

“Parents play an important role in teaching their kids financial responsibility, and keep a close eye on how they use their first credit card or other financial product,” says Schrage.

Some safer ways to build your child's credit:

-Open a bank account-- they can practice using plastic and saving money.

- Add your child as authorized user on your card, provided you use it responsibly.

- Help them apply for a secure credit card. These are usually low balance cards and have a cash backing.

Children under 18 years old cannot enter into a contract, so a parent or guardian would need to in any new account. This means if your kid messes up, it can affect your credit too.

It's important to talk to even very young children about financial responsibility, but if you are looking at letting them use a credit card, it could be safer to wait until they are in their later teens and are possibly more responsible.