Young people & debt: How do teen-agers and young adults fall into financial trouble?

And is this becoming more frequent?

Teen-agers typically fall into financial trouble by trying to keep up with their peers. Because so many of today’s activities involve immediate gratification, teen-agers often do not learn how to save for purchases. As a bankruptcy trustee and attorney, I see more and more 20-something people and even teens in financial trouble.

What’s the youngest age at which someone can get a credit card?

A teen-ager with a co-signer can obtain a credit card under the age of 18. To obtain a credit card alone the person must be 18.

How can a young person develop a good credit record?

Once a person reaches the age of 18, with a credit card with a low credit limit that is paid off in full each month. I have suggested limits in the past of $300 or $500. Do not increase the limit or get additional cards.

What precautions should young people take against identity theft?

Use only one or at the most two credit cards. Check your credit report each year. In Maryland, consumers are entitled to a free credit report each year.  Annualcreditreport.com is a helpful website.

Source: Lori Simpson is a partner with Bishop, Daneman & Simpson in Baltimore and a Baltimore Chapter 7 Bankruptcy Trustee. She can be contacted at lsimpson[at 

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