Different stages in life require different financial tools. Investments, mortgages, and student loans are all available tools based on your age and goals. Credit cards are part of that mix, and it's important to select the right plastic for your age.

The thought of a child with his own cell phone used to seem ridiculous. Today, with growing safety concerns and the ubiquity of mobile phones, it's getting harder to find a child who doesn't have access to such instant communication.

Credit cards have also climbed over some demographic barriers. Different types of plastic now appeal to young and old. They can be particularly helpful when applied to the needs of a specific age group. Here are some ideal uses:

Young teens/college students: A good start

Financial companies used to get lambasted for marketing credit cards to college students, and for good reason. Many students-often without their parents' knowledge-would run up huge credit card debts. Upon graduation, a large amount of their paychecks then went to paying down debts instead of building up savings.

Giving a young teen or college student a credit card can be a valuable learning experience, providing he's properly supervised. Pick a card with a credit limit of $1,000 or less, and a low interest rate. It allows the child some leeway and personal responsibility. It also serves as a nice source of emergency funds, particularly for college students.

Young adults: Avoid temptation to overspend

As young professionals start their careers and begin to earn significant money, they should use-not abuse- credit cards. Making regular purchases can help a young adult establish good credit. He must avoid, however, the temptation to make big ticket purchases, like a plasma TV or elaborate vacation. Paying off balances every month will help him boost his credit score, and make it easier to qualify for a mortgage or car loan.

Middle-age: Reaping rewards

As adults cast an eye toward retirement, they should choose plastic with low-interest rates and good rewards programs. If a person is carrying a balance, he should focus on paying down debt and boosting cash flow. As always, cardholders must resist the temptation to jump at the big-ticket purchases.

Senior citizens: Out of balance

An alarming trend taking place is the increased use of credit cards by senior citizens. Balances are beginning to rise as seniors struggle to pay for healthcare and keep pace with rising fuel costs. People in this situation may need to consider a part-time job, or look into tapping home equity via a reverse mortgage.

Credit cards offer benefits to people of any age. They can also get you into serious financial trouble if you misuse them. Understand your current financial situation before you select the card, and set personal limits on how you use your line of credit. For consumers young and old, these precious pieces of plastic can be either a blessing or a curse. Use financial self-discipline to make sure it's the former.

Published on July 28, 2008