Self-advocacy. Independence. Driving. When we think about all the things we need to teach our children, borrowing usually isn’t among them. In fact, for many children, particularly teenagers, borrowing seems to come naturally.

“Dad, can I borrow the car?”

“Mom, can I borrow 10 bucks?”

The truth is, if we want our children to reach their financial goals later in life, we really need to teach them how to borrow now. And, they’ll need to learn how to obtain loans from institutions other than Bank of Mom and Bank of Dad, which often provide unrealistic views of the risks of borrowing.

“Dad, I can’t pay you back the money I owe you because I spent it.”

So just what can you do to prepare your children for developing a healthy relationship with credit? Here are some parental pointers:

• Make sure your children understand what credit is and why it’s important. Ask them what kind of car or house they’d like to own someday and then show them how borrowing can help them achieve their goals. Show them an example of what their monthly payments would be and how much money goes toward interest.
• Teach them about credit score and history. It is important for them to know that mistakes they make when they are young can keep them from obtaining loans when they are no longer a student.
• Ensure they have a steady job. If your teenager is old enough to work, encourage them to get a job, since a steady income is essential to obtaining credit.
• Open a bank account with your child. Once your child has a job, they can begin putting money in checking and savings. They can obtain a debit card, which will teach them how to spend and manage the money they have responsibly.
• Get starter credit. If your child is 18 years or older, they may be eligible for starter credit. For example, DNB First offers a Student Banking program that provides a low-limit credit card to help students establish a credit history.

Your child may also apply for a department store charge card, which is easier to qualify for than a traditional credit card.

If your child does obtain credit, it’s important to emphasize the importance of paying off their balance in full each month to avoid interest charges.

One other important thing to remember is that despite the fact that your children may be quick to point out your “poor fashion” or other differences, they often try to be like their parents. So if you have a healthy relationship with credit, chances are your children will model your good habits, especially if you take the time to educate them.

Teaching your children about credit won’t always be easy, but in the long run, it will help them become more independent and less reliant on you. And you never know what that might lead to… maybe even a branch closing for Bank of Mom or Dad. Imagine that.

Vince Liuzzi serves as Executive Vice President and Chief Banking Officer at DNB First.