If you’re being added to someone else’s credit card account, there are a few things to consider first. While being an authorized user on a credit card has its perks, you should be aware of your responsibilities.
So long as you understand your privileges and responsibilities, you can use the authorization in the best possible way.
Key Points On Being An Authorized User On A Credit Card
- Authorized users can use another cardholder’s credit card to spend on credit and build credit history.
- Authorized users aren’t responsible for credit card payments.
- The main cardholder is fully liable for the debt, including whatever is spent by the authorized user.
What Is An Authorized User On A Credit Card?
An authorized user (a.k.a., supplementary cardholder or additional cardholder) is someone who gets a card that is linked to the account of the primary holder. Because they are piggybacking off of the credit account of the primary cardholder, the authorized user doesn’t need to meet the same financial criteria and is not responsible for the account.
An authorized user gains access to some or all the credit card benefits seen by the primary cardholder. This may include the credit limit as well as any associated discounts or perks the credit card gives you access to.
Are There Requirements To Be An Authorized User?
To be added as an authorized user on someone else’s credit card, you’ll usually need to meet certain age requirements:
- Age – To be an authorized user on a credit card you must be at least the age of majority in your province. That said, there are many credit cards that allow minors usually between 13 to 17 years of age to be authorized users on their parent’s or family member’s credit card.
Learn more: How To Add An Authorized User To A Credit Card
Which Credit Card Can You Be Added As An Authorized User?
You can be an authorized user on various credit cards. However, while some allow the primary cardholder to add an authorized user for free, others charge an annual fee, which you may have to pay depending on your relationship or agreement with the primary cardholder.
| Authorized User Allowed | Cost | ||
| Tangerine Money-Back Credit Card | Yes | $0 | Learn More |
| BRIM Mastercard | Yes | $0 | Learn More |
| TD Aeroplan Visa Infinite Privilege Card | Yes | $199 | Learn More |
What Are The Responsibilities Of An Authorized User On A Credit Card?
Authorized users typically have no responsibilities, including not being liable for repaying the money. However, certain factors authorized users should keep in mind to ensure they’re acting respectfully and not putting the primary cardholder in a precarious position:
- Use The Credit Card Responsibly: Only make purchases that the primary cardholder agrees to or allows.
- Cover Your Own Payments: Whatever you spend on credit, you should repay yourself.
- Stay Within Healthy Credit Limits: Spending too much on credit can hurt the primary cardholder’s credit score and your own. So, it’s best to keep expenditures well below 30% of the credit limit (or below the threshold established by the primary cardholder).
- Be Transparent With The Cardholder: It may be a nice gesture to let the cardholder know whenever you decide to use the credit card for certain purchases, especially large ones.
Can You Build Credit As An Authorized User?
As an authorized user (a.k.a., supplementary cardholder or additional cardholder) you’re not the owner of the account and you’re not legally responsible for the credit account. As such, any purchases you make on the account are not reported on your credit report and won’t help you build credit.
For more information visit the Government of Canada website.
Pros And Cons Of Being An Authorized User On A Credit Card
The authorized user has far fewer responsibilities than an account primary, along with key perks to take advantage of. To decide if being added as an authorized user is a good decision, there are a few things to consider.
Pros
- Make Purchases On Credit. Many purchases and rentals require a credit card. Whether shopping online, renting a car, or visiting a hotel, being an authorized user gives the opportunity to complete these transactions.
- Learning Experience. For younger or less experienced credit users, being an authorized user is a good way to learn about finances. It poses the opportunity for parents to teach about interest, minimum payments, scheduled payments, and fiscal responsibilities.
Cons
- No Ownership. You’re limited to what the primary cardholder does with the account in terms of how the card is used and credit building.
Bottom Line
Getting added as an authorized user can provide you with the convenience that comes with credit card spending. However, you’re limited to how the primary cardholder uses the card. Eventually, if the card is managed responsibly, you may be able to build a healthy credit score that can help you secure your own card in the future.
