Capital One and ING DIRECT discover one in four teens can't distinguish credit from debit

By , CardRatings contributor
  • Google +
  • Twitter
  • Facebook

As many as one in four American teenagers don't know the difference between a debit card and a credit card, according to a survey commissioned by ING DIRECT USA and its parent company, Capital One. 24 percent of respondents told researchers that they thought spending money with a debit card involved borrowing a bank's money instead of using their own cash. Nearly 12 percent of teenagers surveyed said that they lack adult guidance about how to save and spend their money.

1,000 survey respondents between the ages of 12-17 answered questions about earning and saving money, sharing their concerns and perceptions with researchers. Nearly half of teens surveyed said they get most of their spending money from jobs outside the home. About 30 percent of teenagers reported getting most of their cash from allowances or from handling household chores.

Researchers followed up their survey by asking respondents' parents about their personal finance habits. A sample of 558 parents revealed that most families have prepared for conversations about drugs and sex, but that less than a quarter of American adults have figured out how to talk about money with their kids. One in five parents told researchers that they considered themselves poor financial role models.

Capital One and Search Institute launched a website at BankIt.com to help parents and children talk more openly about money. According to the site's editors, adults can use a few tricks to help their kids build financial literacy skills:

  • Keep the conversation simple. Instead of tripping up on broad technical details, parents can focus on how to save for specific goals, like a video game or tickets to the movies.
  • Tie money lessons to everyday activities. Parents can ask children to help hunt for bargains online and to clip coupons from weekly circulars, offering a commission from the savings.
  • Practice what you preach. Kids can help hold parents accountable when adults share information about financial successes and missteps.

ING DIRECT's survey offers an optimistic view toward closing a gender gap related to personal income. 50 percent of teen girls surveyed make money from jobs, compared to just 38 percent of their male counterparts.

0 Responses to "Capital One and ING DIRECT discover one in four teens can't distinguish credit from debit"

No Comments

Leave a Comment
About Our Ratings ×

Our editors rate credit cards objectively based on the features the credit card offers consumers, the fees and interest rates, and how a credit card compares with other cards in its category. Ratings vary by category, and the same card may receive a certain number of stars in one category and a higher or lower number in another.

The ratings are the expert opinion of our editors, and not influenced by any remuneration this site may receive from card issuers.

Advertisers in our database are highlighted, and advertisements include an option to apply using links on our site. CardRatings.com may be compensated by companies mentioned on the site when a user's application is accepted or approved by such companies.

How do your cards stack up?

Compare your card starting here


Featured Partner Cards