Adding your spouse as a credit card authorized user is a big credit score hack! Building your credit is just like staying married, it’s a long and consistent game. This was one of the credit building hacks that my husband and I did to boost our credit scores. This hack worked for us because we both had good credit, long history, and didn’t have credit card debt. But what tips do you give a couple where one person has good credit and the other has bad credit?
When it comes to building credit as a married couple, one person having bad credit is a heated topic. To cool things down, I want to clarify that building good credit takes dropping old habits and building new ones. When you’re married, a lot of times the spouse that has good credit can help motivate you. This is why I believe that when you’re married, you are a team that’s stronger together than separate. The main reason I say this is because it’s easier to accomplish goals and attack problems together. Especially, when you want to buy a home, a new car, or even get a joint credit card.
Credit Card Authorized User
The easiest credit card hack to increase your credit score is to add the person who has a lower credit score as an authorized user to your credit card. This will allow the authorized user to only able to use the card, but not be responsible for the bill. The best way to explain this is when you have kids that live in your home. They can live there but they don’t own the home or are responsible to pay the rent. This is you giving another person the ability to claim your home address, use the home, but that’s it. Thus, helping them claim you’re good credit history or in this example use your address.
So, I know you’re probably wondering if you can add your teen kids as authorized users. If you have amazing credit then the answer is yes, but I wouldn’t recommend giving them the actual card. You only want to give someone the credit card they’re authorized to use if you’re okay with being fully responsible for the bill. This is why it’s important to only add people you trust as authorized users like your spouse or teen.
Authorized User Example:
To better clarify how adding your spouse as an authorized user to your credit card works, here is this example.
Let’s say you have a credit card that you’ve been using for 8 years. You’ve never paid late, always paid the full amount and you have a high credit score.
By adding someone as a credit card authorized user, you are sharing all of your positive credit histories. This is specifically with the credit card you grant authorization to, not all of your credit history.
So, when you go look at their credit history. You’ll see a positive 10-year credit history to their credit score due to that card’s positive credit history.
Credit Card Fraud Prevention
The last tip is to review which credit card you want to keep or toss. Before adding your spouse as an authorized to your credit cards, make sure you still want to keep that card. I personally found it difficult to keep credit cards open only because it will help boost my credit score. You hear a lot of financial gurus recommend to never close a credit card. But you don’t hear too much about the anxiety of keeping the account active just to keep it active. Especially, if it’s a card that you don’t use or has a specific purpose in your daily routine.
I personally had a credit card that I never used open simply because of the advice of never closing a credit card. This was a card that I had no use for and never even checked on because I didn’t use it. I later come to realize that I had fraud on that card. My anxiety kicked in and I decided to clear the fraud and then close the account. Even though this is not recommended, it was honestly the best decision ever. I didn’t have to deal with using the credit card to keep it active or check for fraud anymore. It was a relief! After that, I became more cautious about opening credit cards and if the credit card fit into my everyday routine.
The best tip I have for any couple or parents trying to help someone they love to build their credit is to teach them positive spending habits. The best way I’ve been able to do that is to use my credit card like a debit card. Just using your card wisely will make a difference in helping your loved one build and maintain good credit. Well, I hope you guys found value from this blog post and Q&A. As always mi gente, keep up the positive financial habits.