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Teaching Financial Literacy

Are your kids ready for a cell phone?

By Carla Hindman, Director of Financial Education, Visa Canada

If your preteen child hasn't hit you up yet for a cell phone, you're among a rare breed indeed. Studies have found that roughly 70 percent of 11- to 14-year-olds now use cell phones. Closer to home, my young niece recently got her first smartphone… in fact, a newer model than mine!

While the need for a teen to have a phone escaped me at first, upon investigation, I see why parents may want a phone in their kids' hands. Here are a few pros and cons for giving your preteen a phone, and some safeguards you can take:

Safety. Anyone who's ever had a flat tire or gotten lost can attest to cell phones' safety advantages. On the flip side, unless you install parental controls, your child could access inappropriate content or be more vulnerable to bullying and predatory behaviour.

Expense. Cell phone use, including calls, text messaging, web browsing and application downloads, can be wildly expensive. You have a few different payment options, including: Prepaid plan – buy minutes and "pay-as-you-go." Plans vary widely in terms of fees and per-minute calling and text rates. Advantages: No locked-in service contract; know exactly how many minutes they're using. Disadvantages: Parental controls usually don't apply; phones more expensive than under a service contract plan.

  • Family plan – sometimes it's cheaper to add a phone to your existing plan. Some plans allow unlimited calls/texts between friends and family or those using the same carrier. Advantages: Generally cheaper if your kids make lots of calls/texts; most allow parental controls. Disadvantages: Parental controls may cost extra; some plans don't allow usage caps, so undisciplined kids may rack up large bills; tied to service contract.

Parental controls. One of the best ways to protect your kids is to subscribe to your carrier's parental controls plan. Plan features vary widely, but look for these when comparison shopping:

  • Cost.
  • Ability to cap phone minutes and text messages.
  • Allow emergency calls, even if over monthly usage allowance.
  • Cap and/or block entertainment downloads (costly/inappropriate ringtones, music, video, etc.)
  • Block mature content websites from Internet-enabled phones.
  • Restrict time-of-day usage (e.g., block during school hours or after bedtime).
  • Block calls/texts from specific or unknown numbers (helps prevent stalking, bullying and inappropriate contact).
  • Track your child's physical location (requires GPS-enabled phone and typically costs $5 to $10 a month).

Parental control programs generally are not available with prepaid plans. And, since no filtering tool is completely foolproof, it's important to regularly discuss safety issues with your kids. Make sure they're comfortable coming to you with any questions or details of inappropriate contact they've received.

Not every child is ready for cell phone responsibilities. Set ground rules and be prepared to withhold privileges if they cross boundaries, such as not abiding school regulations, exceeding curfews or usage limits, using to bully others, repeatedly losing or damaging the phone, etc. And make sure they kick in part of their allowance to help pay.

This article is intended to provide general information and should not be considered legal, tax or financial advice. It's always a good idea to consult a tax or financial advisor for specific information on how certain laws apply to your situation and about your individual financial situation.

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