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Personal Finances / Credit Cards and Consumer Debt


Subject:  Re: Credit for College Date:  1/11/2019  11:22 AM
Author:  aj485 Number:  312328 of 312777

First, it is my understanding that being an authorized user does not impact her credit score (but I could be mistaken on that).

Sorry, you are incorrect. There was a short time frame when being an authorized user was pulled out of some of the credit scoring models, but there was significant pushback, and it was reinstated.

Second, and more importantly, I don't see how that does anything to help her learn how to actually use and manage a credit card.

Well, the immediate question was how to get the daughter some credit, which is probably most quickly accomplished by putting her on other cards as an authorized user, since new accounts can delay reporting to credit bureaus for up to 90 days. That said, even with an authorized user card, the daughter could be allowed to manage the card herself, especially if the owner(s) of the card don't use it.

I do agree that it's important to ensure that the daughter is responsible in her use of credit, and managing her own card will help with that. But co-signing accounts, especially for someone who doesn't have any credit history puts your own credit record at significant risk, so it's probably better to wait to co-sign until there is some history of responsible use of credit.

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