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- A joint credit card can be a convenient way to share expenses with a spouse, domestic partner, or another member of your household.
- It’s usually easy to set up, but a joint credit card does come with its risks. In most cases, one person takes primary responsibility for the card, no matter how the other person uses it.
- For that reason, you only want to share a credit card with someone you know you can trust to use it responsibly.
Opening a joint credit card account allows you to make purchases with someone else. Just about every credit card I have is joint with my wife, as most of our purchases are shared for our household and we pay for everything from a joint checking account.
A spouse is the most common person to share a credit card account with, though it is not the only situation you would want a joint credit card. It may be convenient, but you should probably hold off on opening a joint account with a boyfriend/girlfriend or even a fiance until you tie the knot and say "I do."
It may also make sense to open a joint credit card with a parent or child. In some rare cases, you may want to open one with a friend or other relative. But when you open a joint credit card, you share more than just a way to pay.
The risks of a joint credit card account
When it comes to credit and loan accounts, uniting with someone else may provide a host of benefits. But you shouldn’t rush to join your finances with someone else, however, as there may be some serious financial consequences. But unlike a mortgage or student loan, the burden of a joint credit card may not fall on both parties equally.
When opening a credit card, you typically can’t open it as a joint account from the start. Instead, one of you will open the account in your own name. Once the account is approved, or in the application process, you can add the second person as an authorized user.
If you are the primary account holder, you are legally liable for all charges made by the authorized user. They may have the account show up on their credit report, for better or worse, but don’t have the same liability for charges as the person who puts their name at the top of the application form. Regardless of any agreement you make, the bank cares most about the primary account holder if the bills are not getting paid on time.
Speaking of late payments, they will probably show up on both of your credit reports if a due date is missed. If you think the other person is responsible and paying, but they are not, you could have an expensive and challenging surprise waiting for you on your credit report.
This is why you should be incredibly careful when opening a joint account with someone. If you trust the wrong person, it can ruin your credit and leave you with thousands of dollars in debt.
How to open a joint credit card
I added my wife as an authorized user to one of my credit card accounts when we moved in together to use for groceries and other shared expenses. In this case, I had an account I already liked and just added my wife. But in many cases, it could make more sense to start fresh with a new account you both plan to share.
The first thing you should do after you decide to open the new account is to figure out who has the best credit. The interest rate and approval for the card is based on the primary applicant. If the partner with a lower credit score attempts to open the account, you could end up with unfavorable terms or even a denial.
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You can start by getting your free credit reports at AnnualCreditReport.com, the official credit report website mandated by the US government. To get your credit score, you can use a free credit score website or app like Credit Karma.
Once you know who has the best credit, that person should open the new account. When they get to the step to add an authorized user, you can enter the information for the joint cardholder. Beware that some credit cards charge an additional annual fee for additional authorized users. Check your card details to find out if that applies to you.
A joint credit card can be convenient, but it also puts a lot of trust in the joint account holder to pay their share and not overspend. If you find the right person to open a joint account with, likely a spouse or domestic partner, a joint account can be a great decision. Just make sure you are aware of the risks and trust that you can work together for joint success.
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