#CanAddingKidsAsAuthorizedUsersBuildCredit
##Understanding Authorized Users
Authorized users are individuals who are granted permission by the primary cardholder to use their credit card account. While authorized users have the ability to make purchases with the card, they are not legally responsible for paying off the debt.
###Authorized User and Credit History
Adding your kids as authorized users to your credit card may help them start building a credit history. When you add them, the account history, including the payment history and credit utilization, will likely be reported on their credit reports as well. This can potentially have a positive impact on their credit score.
##Benefits of Making Kids Authorized Users
There are several benefits to making your kids authorized users of your credit card:
###Establishing Credit History
By adding your kids as authorized users, they can piggyback off your credit history. This can be especially beneficial for teenagers who are just starting to establish their credit history.
###Teaching Financial Responsibility
Allowing your kids to use a credit card responsibly can help them learn important financial lessons about managing credit and making on-time payments.
###Boosting Credit Score
If you have an excellent credit score, adding your kids as authorized users can potentially improve their credit score as well. This is because the positive payment history and low credit utilization from your account can reflect positively on their credit reports.
##Monitoring the Impact
To determine whether adding your kids as authorized users is having a positive impact on their credit history, you can:
###Check Their Credit Reports
Regularly monitor your kids’ credit reports to see if your credit card account is being reported and if there are any improvements in their credit score.
###Review Credit Score
Keep track of your kids’ credit scores to see if there are any noticeable changes after adding them as authorized users. This can give you a good indication of whether the strategy is working effectively.
In conclusion, making your kids authorized users of your credit card can be a helpful way to kickstart their credit history. By monitoring their credit reports and scores, you can ensure that adding them as authorized users is positively impacting their credit history.
Doesn’t matter when you add them, the full history will appear on their credit report.
Makes no difference if you do it at 8 or 18
It depends on if the card company sends data to the credit monitoring company if for minors. Not all do (eg Chase). But, once they turn 18, they’ll have that history on their report.
This is how I got a credit score, so yeah it does work! Think you can just look up their credit score and confirm it directly on experian, equifax or transunion.
Only if you gave the card company your kids ss numbers along with their names.
This is what my mom did for me. She put me on her Macy’s card and something else. Ended up having a 700+ credit as an 18 year old… with 0 financial knowledge or finance planning/experience. My parents, for all the good they did for me, never actually taught me anything. I blew my credit up in my 20’s and spent 5+ years repairing it. Happy to say I’ve had an 800+ credit score going for over a decade now so all’s well that ends well, but please try to educate your kids on finance a little and help them make good decisions, in addition to setting them up for success from a credit score perspective.
It is. Don’t give them the cards. It’s not as good as a card in their name, but it helps.
Just make sure you keep a low balance to debt ratio or it won’t help them
As long as you give credit card company their SS #’s to allow them to report to credit agencies… authorized user without the #’s just allows them to use the cards
Ok so my kid is turning 14 and I’ve considered this. But a potential downside is that he’s being given a great credit rating despite the fact that he’s objectively terrible with money. I’m not sure giving him access to credit when he’s older is such a good idea. Shouldn’t a kid have to earn their credit score?
Yes, my parents did this as soon as possible and gave me a copy of said card for emergencies, so upon turning 18/20 or whenever you really fully get a score, mine was and continues to be around the 800 mark. I was in my 20s with like 15 years of credit history, lol
You don’t need to do this until they turn 18
Be sure to teach them about credit
Teach them how to freeze their credit with the three credit bureaus (and to unlock it when they apply for credit, a loan, etc.)