One move can help your child achieve a high credit score in the future, advises a CFP and father of six—but beware this 'dangerous' mistake.

Your child will receive their own card linked to your account, but as the primary cardholder, you will still monitor their purchases and be responsible for paying off the balance each month.

"According to Gregg Murset, a CFP and co-founder and CEO of BusyKid money management app, this method is an excellent way to help children start building credit. By providing some supervision, parents can guide their children as they learn about credit management."

By consistently making on-time payments and keeping credit utilization low, your positive credit habits can be passed on to your child, giving them a strong foundation to build their own credit after turning 18. However, it's important to check with your card issuer to confirm if they report the payment history of authorized users to credit bureaus.

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Murset suggests that it's not necessary for a child to have a perfect 850 score for them to benefit from being an authorized user, but it's important to consider your own score.

"If you have a responsible credit score, it will help them more likely."

If you add your child as an authorized user without teaching them how to manage money responsibly, it can negatively impact your credit score, warns Murset. To avoid this, follow these three steps before making the move.

1. Avoid 'other people's money syndrome'

""The notion of using 'other people's money' becomes ingrained in their minds, making it effortless to rely on their parents' credit card for purchases like a hamburger, which can lead to irresponsible and unaccountable behavior if not addressed," he warns."

One way to help your child get ahead is by opening a debit card with them first.

Some banks provide joint checking accounts for teens and their parents, and certain banks allow parents to obtain debit cards for children as young as 6.

""Add them as an authorized user after they demonstrate responsibility with their own money, but don't consider it until their mindset is set, as they may waste your money if they don't see it as their own," Murset advises."

2. Set clear spending guidelines

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3. Go over credit card statements with your child

Allowing your child to use your credit card for purchases may lead them to believe it's a gift card rather than real money, according to Murset.

He advises going over the credit card statement with them, tallying up their charges, and having them explain their monthly purchases on the card.

If they exceeded the spending limit or purchased items they weren't allowed to with the card, we can discuss a plan to repay the excess amount, which will hold them responsible for their spending.