Being a joint account holder and an authorized user are two different ways that two people can share the same account. However, there are a few important differences that you’ll want to be aware of.
When you add an authorized user to your account, the authorized user can benefit from the good credit and payment history on your account but is not responsible for the debt. With a joint credit card account, however, both people apply at the same time and are then legally responsible for all purchases and debt on the account, regardless of which person actually makes the purchase.
Key Points
• Joint credit card account holders share equal responsibility for all charges, while authorized users are not legally liable.
• Joint accounts impact both parties’ credit scores, whereas authorized users can benefit from the primary cardholder’s credit history.
• Joint accounts are ideal for committed relationships, while authorized users are better for helping someone build credit.
• Both arrangements can increase credit card rewards, but the primary cardholder retains full control in an authorized user setup.
• Choosing between a joint credit card and an authorized user should consider relationship dynamics and financial goals.
What Is a Credit Card Authorized User?
An authorized user on a credit card, sometimes called a user of a supplementary credit card, is an additional person who is added to the account of the primary cardholder. The authorized user gets their own physical card and can make purchases. The authorized user may benefit from the good credit or a positive payment history on the account; it could help them establish or build their credit. However, they are not responsible for any of the purchases or debt.
How an Authorized User Impacts Your Credit
There are many factors that affect credit scores, but adding an authorized user to your account is not one of them. If you add an authorized user to your account, your credit will not be checked, and there should be no immediate impact on your credit. You will want to keep in mind, however, that you are responsible for any purchases made by authorized users. So if your authorized user spends more than you anticipate and you have trouble making the full monthly payment, it could negatively impact your credit score.
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Things to Consider When Adding an Authorized User to Your Account
There are many different types of credit cards out there. Here’s a quick look at some things to consider when adding an authorized user to your account, regardless of the card’s specific features:
| Risks | Rewards |
|---|---|
| You are legally responsible for all purchases made by an authorized user | May help establish or build the authorized user’s credit if used responsibly |
| May impact your credit if not used responsibly | Additional spending can generate additional credit card rewards |
| Primary cardholder can remove the authorized user from the account at any time |
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What Is a Joint Credit Card Account Holder?
Unlike adding an authorized user to your account, you will typically obtain a joint credit card by applying for one with another person. With a joint credit card, the credit of both prospective cardholders is evaluated and used to determine eligibility. If approved, both cardholders are equally and separately liable for all of the debts and purchases on the account, regardless of who actually made the purchase.
It’s worth noting that joint credit cards are becoming less common, and it may therefore be challenging to find one.
How a Joint Account Impacts Your Credit
When you apply for a joint account, the credit of both people is reviewed, and then the applicants are possibly approved to receive a card. This will generally show up on each potential account holder’s credit report as a new inquiry, which may temporarily lower each person’s credit score by a few points.
Additionally, both joint cardholders are responsible for all of the debt, regardless of who actually uses the credit card. So if one person spends more than expected or has trouble paying the bill on time, it may negatively impact both cardholders’ credit scores.
Things to Consider Before Opening a Joint Credit Card Account
Here’s a quick look at some things to keep in mind before opening a joint credit card account:
| Risks | Rewards |
|---|---|
| Many major issuers do not allow joint accounts | Additional spending by two people can generate higher credit card rewards |
| Cannot remove one person from the joint account without closing the entire account | When used responsibly, it can help establish or build the credit of both cardholders |
| May get complicated if the relationship between the joint cardholders changes (e.g. divorce) |
Joint Credit Card Account Holder vs Authorized User
Consider the differences between these two arrangements:
• A joint credit card account is one where two people jointly open and use the account, with both people equally responsible for all of the debt.
• An authorized user vs. a joint credit card has a key difference: The authorized user is not liable for any purchases they might make — instead the primary cardholder is responsible for all charges.
• Being an authorized user may be one way to help establish or build your credit if the primary cardholder already has good credit and continues to use the account responsibly.
Recommended: What Is the Minimum Age to Be an Authorized User on a Credit Card?
Choosing the Right Option
A joint credit card account typically only makes sense for two people that are in a committed relationship in which they are already sharing their finances. And you will also want to keep in mind that many major credit card issuers do not offer joint credit card accounts.
An authorized user, on the other hand, can make sense if you want to help build the credit of someone who is starting out or wants to positively impact their score. By adding them to your account, you may help them establish or build their credit.
The Takeaway
An authorized user and a joint credit card account are different ways that two people can share a credit card account. With a joint credit card account, both people open the account together and are equally liable for all charges on the account. With an authorized user on an account, only the primary cardholder is responsible for the charges. Those differences may help you decide which (if either) arrangement is right for you.
Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.
FAQ
Is a joint credit card holder the same as an authorized user?
No, having a joint credit card account is not the same as having an authorized user on your account. With a joint credit card, both account holders are equally and separately liable for all charges on the account, regardless of who actually makes the purchase. With an authorized user account, only the primary cardholder is responsible.
Is it better to be an authorized user or have your own credit card?
When you are an authorized user on a credit card, you can make purchases and may be able to establish or build your credit, but you’re not responsible for any of the charges. However, it may make sense at some point to work towards having your own credit card account where you don’t have to rely on anyone else.
Can you have 2 names on a credit card?
Generally there won’t be two names on a credit card, even if it is a joint account. In both the case of a joint account and being an authorized user, each person will get their own credit card with their name on it. Depending on the card issuer, the credit card account number may be the same or may be different.
Photo credit: iStock/Igor Alecsander
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