How an Authorized User Status Help Build Credit Score?

This article will discuss when to consider adding an authorized user, credit score implications of becoming an authorized user on someone else’s credit card account, and other considerations. 

What is an Authorized User?

By becoming an authorized user on someone else’s credit card—be it a parent, guardian, or other trusted adult—the credit card issuer will send a credit card to the primary cardholder having your name appear on the card.

How Does Being an Authorized User on a Credit Card Work?

Authorized users don’t hold responsibility for paying the balances due on credit cards, meaning when you become an authorized user, it has a limited effect on your credit.

Authorized User Pro

– Being an authorized user can help a person build or restore their credit if they get added as an authorized user on a credit card of someone with an excellent (or better) credit history. – The primary cardholder remains fully responsible for all credit card charges, payments, and liability. – Adding an authorized user account doesn’t cost money in most cases.

Authorized User Con

– You can remove an authorized user from the credit card account at any time. – You can negatively impact an authorized user based on poor user activity from the primary cardholder. – You have no guarantee of an authorized user seeing a quick credit improvement—if at all.

Do Debit Cards for Kids Help Build Credit?

For an account to impact your credit scores, it needs to count as debt or liability. To build good credit, you need to make regular payments on these debts over long periods. This factor plays the most significant role in building your credit.

What is a Credit Score?

A credit score is a number that predicts how likely you are to repay borrowed money.

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