The pros of adding an authorized user to a credit card outweigh the cons in most cases. The primary pro of adding an authorized user to an account is that it allows the authorized user to build credit, while the biggest con is that you are responsible for any purchases the authorized user makes.
Fortunately, there are ways to manage the downsides of this arrangement. For one thing, you don’t have to give the authorized user an actual card to use as they see fit. Simply being listed on your account is enough for them to build credit, provided you pay the bills on time. You can learn more about the possible pros and cons of adding an authorized user below.
Pros of Adding an Authorized User
- Helps a friend or family member improve their credit score.
- Gives the authorized user access to better rewards or lower interest rates than they might get otherwise.
- Enables the user to make purchases, whether for everyday needs or emergencies, if you decide to give them an actual card.
- You will earn rewards on the authorized user’s purchases if you have a rewards card.
- Some credit cards give bonus rewards for adding an authorized user.
- Adding an authorized user will not affect your credit score.
While there are some obvious benefits to adding an authorized user, there are also some downsides to consider before you add one.
Cons of Adding an Authorized User
- You share your credit limit with another user, so you may have less available credit when you go to buy something due to their purchases.
- You are legally responsible for paying off the authorized user’s purchases.
- Missed payments can hurt the authorized user's credit score as well as the primary accountholder’s score.
Adding an authorized user can be both convenient and a great way to help someone else build their credit, so long as it’s a person you trust to use your account responsibly. Be sure to take a look at WalletHub’s authorized user guide for a full breakdown of how to add an authorized user and everything that comes along with doing so.
This answer was first published on 01/18/23. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
FAQs
Authorized users get several advantages of credit cards, such as flexibility and credit-building opportunities, but the primary cardholder is still responsible for payments. Meanwhile, primary cardholders can enjoy more convenience and the chance to earn additional rewards.
Is there a downside to adding an authorized user? ›
And if an authorized user racks up a high balance, it could hurt the primary cardholder's credit utilization. You risk allowing the primary cardholder to hurt your credit: The primary cardholder's behavior also reflects on the authorized user. Late payments and other credit mishaps can harm both of your credit scores.
Is it worth adding authorized user to credit card? ›
Being added as an authorized user on another person's card may help you establish a credit history or build your credit. Yet cardholders and authorized users' on-time, late or missed payments will be added to both parties' credit reports, so it's important that cardholders and authorized users see eye to eye.
Can adding someone as an authorized user hurt their credit? ›
The risks of being an authorized user
In order for a credit account to impact your credit score, it must be reported to the credit bureaus. If your credit card issuer doesn't report authorized user activity to one of the three credit bureaus, your credit score will not be impacted.
Why did my credit score drop when I was added as an authorized user? ›
If there's a history of late or missed payments on the account you've been added to, or if that account has a balance that exceeds about 30% of its credit limit, it will tend to lower the credit scores of the primary account holder—and potentially yours, as an authorized user.
Will removing myself as an authorized user hurt my credit? ›
A: Removing yourself as an authorized user will not affect the primary cardholder's credit score.
Should I add my son as an authorized user? ›
Adding a child to your credit card as an authorized user can help them establish a credit history. Your credit history can boost theirs, and improve their odds of getting approved for credit later. Any charges they make are your responsibility; be sure to set clear guidelines and know the risks.
Can an authorized user see all transactions? ›
Authorized users on credit cards can make purchases, review their transaction history and dispute unauthorized charges. However, they don't have complete access to or control over the credit card account, and they aren't ultimately liable for the debt.
Is it better to be an authorized user or have your own card? ›
One of the primary benefits of being an authorized user is building your credit history. If you are added to a card that doesn't report authorized users, you'll enjoy the card's benefits, but it won't improve your credit score.
What happens when you add an authorized user? ›
An authorized user is someone who's been added to a credit card account by the card's owner, also known as the primary cardholder. The authorized user can make purchases with the credit card as if it were their own. However, the responsibility to pay any charges remains with the primary cardholder.
Authorized users usually won't run into this problem, as there's generally no credit check involved. The authorized user strategy is common for parents who want to help their children build credit.
Does adding an authorized user affect their credit capital one? ›
Adding a user won't impact your credit score—only the usual factors like payment history and available credit do that.
Does being an authorized user affect your credit limit? ›
Being an authorized user can help you build credit—increasing your credit age, overall credit limit and history of on-time payments—but creditors will also want to see that you're up to the task of repaying the money you borrow.
How fast will my credit score go up as an authorized user? ›
According to a 2018 study done by Credit Sesame, people who had a fair credit score saw their credit score improve nearly 11% just three months after becoming an authorized user on someone's credit card.
Do authorized users build credit? ›
Becoming an authorized user on someone else's credit card account is a strategy for improving credit quickly. It works best if the primary user's card has a long record of on-time payments and a high credit limit and the authorized user doesn't have recent blemishes on their credit report.
Can you remove an authorized user? ›
To remove an authorized user, call the number on the back of your credit card to reach the card issuer's customer service number and request the authorized user to be removed from the account. Some credit card issuers may even allow you to remove an authorized user online or via the company's mobile app.
Will adding someone as an authorized user help their credit capital one? ›
Adding a user won't impact your credit score—only the usual factors like payment history and available credit do that. As long as you and your user use your card responsibly and make payments on time, these actions can have a positive impact on your user's score.
Will adding my wife as an authorized user help her credit? ›
Building good credit
If your partner's credit could use a boost, adding them as an authorized user could be one of the best ways to help them earn a good credit score.
Is it better to be a authorized user or joint account holder? ›
If you want to help someone build their credit or access to a credit line for emergencies but are willing to cover their charges, adding someone as an authorized user may be a good idea. But if you want them to be equally responsible for the payments, a joint credit may be a better choice.
