Here's how parents can use a "stepping stone" strategy to improve their kids' credit score.

• Adding a child as an authorized user to a parent's credit card account can aid in establishing a child's credit history and score.
• Experts recommended that the strategy is generally best for kids in their later teenage years, around 16 years old, or those in their early 20s.
• Experts advised that parents may establish spending limits and a conclusion date.

Experts suggest that parents can aid in establishing their child's credit history and score by adding them as an authorized user to their credit card account.

By piggybacking off their parent's good credit, a child can begin building their own credit at a young age.

According to Ted Rossman, a senior industry analyst at CreditCards.com, the best strategy for kids is generally to wait until they are around 16 years old or in their early 20s before implementing a credit strategy.

Building credit can be viewed as a "milestone" by parents, he stated.

"Rossman stated that it has become more difficult to establish credit under one's own name, but using this tool can greatly assist in overcoming this challenge."

Teaching kids responsible credit card management can help them develop healthy financial habits early on, according to consumer finance expert Andrea Woroch.

Why building credit is important

Typically, lenders view credit scores of 700 and above as the best.

A credit score is influenced by various elements, including payment history and the length of an account's existence.

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Early in one's career, having good credit can lead to numerous financial advantages, such as being eligible for loans and lines of credit, and receiving a lower interest rate on that debt.

When evaluating applications, landlords, utility providers, cell phone companies, and prospective employers typically conduct credit checks.

Things to consider

Experts advised that parents should only employ the authorized user strategy if they themselves possess good credit.

Your child will benefit from your positive credit history and credit score if you pay your bills on time and don't carry a large balance each month, according to Woroch.

They should also ideally have an end date in mind.

Rossman stated that he might be away for one to three years due to certain circumstances.

If a child misuses a credit card, the primary accountholder, usually a parent, is legally responsible for all authorized user's transactions.

Experts advised that parents can establish spending limits for authorized users based on their card provider.

They set a low credit allowance, just enough for the teen to fill up their car's gasoline tank or go to the movies a few times each month.

Kids don't need a card from their parents.

Rossman stated that the credit benefits are translated regardless of whether the card is used or not.

Parents should ensure that they establish clear rules and boundaries regarding the use of the card, as advised by Woroch.