Parents now have the power to keep young adults out of credit card debt
Parents should be particularly elated about one section of the freshly adopted credit card law that could keep young people out of debt.
The Credit Card Accountability, Responsibility and Disclosure Act prohibits card issuers from extending credit to a person under 21 unless one of two conditions is met. Under one condition, the card issuer has to verify that a young adult has the "independent" financial means to repay any credit.
Under a second condition, a young adult could get a credit card if a parent, guardian, or an individual 21 or older agrees to be a cosigner. The law says you have to agree to be jointly liable for the charges. If you cosign, you are agreeing to be responsible for all the debt.
So I'm recommending you don't cosign. Tying yourself to how someone else pays his or her bill can damage your credit. But more importantly, there's little, if any, reason for a young adult to get a credit card, particularly if the person doesn't have a full-time job. The new law has the potential to prevent suckering millions of young people into debt. However, it won't work as intended if parents or other adults cave and cosign.
It doesn't matter if you have a family agreement that your kid will pay for any charges. One missed payment and you get the bad mark on your credit reports. You get hounded for the payments.
And don't give me that baloney about young adults needing to build a good credit history or to learn to handle credit. Those are reasons that have been fed to you by the credit card companies. There's plenty of time for young people to get and use a credit card. Let them spend their younger years learning to live with the cash they have.
Besides, there's little need to worry they won't be able to establish a good credit history. With the sophistication of the automated credit scoring system, it takes only about six months to create a credit history, according to Craig Watts, public affairs director at FICO, which produces the FICO credit scores.
Worried about your child getting a job without a good credit history? Don't.
Most employers don't do a credit check. And even those who do pull a potential candidate's credit report are looking for signs that someone has been financially irresponsible.
There are a few other provisions in the new law that make it harder for credit issuers to get their hooks into young people. Gifts to college students in exchange for filling out a credit card application are prohibited.
Issuers can't send prescreened credit card offers to people under 21 unless the consumers have consented to receive these offers. The law bans card issuers from raising the credit limit on accounts held by a person under 21 unless the cosigner gives written permission.
The best part of this law is the authority it gives the parents or guardians to keep young adults away from debt a little longer. Please exercise that power.
Michelle Singletary is a columnist for The Washington Post. She can be reached at singletarym@washpost.com. 
