Ask Jean: Should I Add My Grandson As An Authorized User On My Credit Card?
Trying to make the most of ask jean should add? You are in the right place. Below we break it down in plain English, with practical tips you can actually use.
Key Takeaways
- A reader asks HerMoney CEO Jean Chatzky if she should add her grandson as an authorized user on her credit card to help him build credit his...
- Q: I’m considering adding my 24-year-old grandson as an authorized user on my credit card to help him build credit history.
- I do not plan to give him access to a credit card.
Q: I’m considering adding my 24-year-old grandson as an authorized user on my credit card to help him build credit history. I do not plan to give him access to a credit card. If he messes up his credit at some point, will it affect my score?
A: Short answer? No. Anything your grandson does in the future will not affect your credit score, since your score is based only on your own accounts.
That said, it’s your grandson who could be at risk. “If the credit card he’s added to as an authorized user falls into trouble, for example, if balances run too high or payments are missed, that negative activity would appear on both your credit report and his,” says Michael Lofley, a CFP with HBKS® Wealth Advisors. “In other words, the real credit risk in this arrangement falls primarily on your grandson.”
A potentially better option? Consider a “secured credit card.” “This acts as a line of credit based on an amount on deposit in a bank account, typically a few hundred dollars to start, which a grandparent could provide,” says Michael Pumphrey, a CFP with Tanglewood Total Wealth Management. “This allows the grandson to learn how to use credit wisely, but with the guardrail that they won’t go over the amount they have saved.”
Share this guide:Final Thoughts
The bottom line: a little research on ask jean should add goes a long way. Compare your options, watch for seasonal offers, and never pay full price when a better deal is one click away.
Originally published at savingswitch.com.
SnaggyCodes Editorial Team
Our editorial team researches and verifies every money-saving guide before publishing. Editorial policy · About us