One of my daughters is starting to work and has asked me questions about what she should be doing with her money. She is lucky, her student debt is not very high and she has very few expenses, but she has a credit card (more on that later). We started with where she should put her excess savings (but yes she is paying down her student debt too). We decided she should open a TFSA (I will write more about that later).
During these discussions, she asked me, “Should I put more money in my TFSA or pay off my credit card balance?”. Luckily she asked me that in an e-mail, and I was able to delete the, “WHAT ARE YOU INSANE? DON’T YOU READ MY BLOG?!?“, e-mail and simply responded, “Pay off your credit cards balance every month, never carry a balance”.
My daughter took my advice to heart, and she paid off her credit card.
Wait a minute, when did my daughter get a credit card? She never told me she did, maybe she got one when she started working? I was confused.
We started discussing her TFSA again, and she was looking at her on-line banking page, and I asked her, “When did you get a credit card?”. She pointed to her on-line banking, and said, “… there it is…”, so she seemed to have a credit card.
I was still confused, so I asked, “When did you apply for a credit card?”. That was the right question to ask.
As background, about 3 years ago, I decided that as a safety measure, I would give my daughters credit cards from my account. This was when most of them were in school, so it was very much an emergencies only card.
My daughter’s answer to my question was, “I don’t know, I never applied for a card”, and finally everything fit into place. TD had put my credit card on her on-line banking (using her card number). What is interesting is that she sees the entire balance on the card, and she paid it all off (taking my advice).
In the end she had paid off a couple of Uber trips that one of her other sisters had taken, but luckily I had no charges on there.
My only concern is why did TD put my credit card on her on-line banking? My guess is because it is in her name, so it is actually a group credit card, but I am not sure.