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Depending on the credit card issuer and the card, there can be foreign transaction fees assessed when you purchase an item overseas as well as annual fees. There are also some credit cards that don’t charge any foreign transaction fees or annual fees at all.

Opting for a no annual fee and no foreign transaction fee credit card may seem like the obvious choice when selecting a card — and often it is. However, there are some scenarios in which avoiding fees won’t necessarily be a cardholder’s top priority. Learn the full story here.

What Are Foreign Transaction Fees and When Are They Applied?

A foreign transaction fee is a charge that you might pay when you make a purchase on your credit card while in a foreign country. For instance, you might get charged a foreign transaction fee when buying a ticket to visit a museum or dining at a restaurant abroad. These fees might also get tacked on when you take out money from an ATM in another country.

You don’t necessarily have to be in a foreign country to get charged a foreign transaction fee though. Sometimes, a foreign transaction fee might kick in if you’re buying something from a company that’s based in a foreign country and that processes the transaction in its local currency. For instance, let’s say you buy a pair of shoes from a retailer based in France. If the purchase is processed in euros, you might be charged a foreign transaction fee.

A foreign transaction fee is typically based on a percentage of the transaction amount. For instance, if your card charged a 2% foreign transaction and you bought an item that cost $100, the foreign transaction fee would be $2.

Foreign transaction fees are a common credit card fee that will show up on your credit card statement, and they can make your travels more expensive. Say you spend $4,000 on a trip overseas, and your credit card charges a 2% foreign transaction fee. In that case, you’d pay $80 extra to cover the cost of foreign transaction fees.

How Much Are Foreign Transaction Fees?

The amount of foreign transaction fees varies depending on the credit card issuer. That being said, most foreign transaction fees are between 1% and 3% of the transaction amount. A number of cards don’t have a foreign transaction fee.

One thing to note: Foreign transaction fees are different from currency conversion fees. In some cases, you might get hit with a double whammy and be charged both. You could also face a credit card convenience fee, depending on where you use your card.

Foreign Transaction Fees by Credit Card Issuers

Here’s a look at foreign transaction fees charged by the major credit card issuers. On average, here’s how much they can run, depending on which card you’re using and the issuing bank or credit union. Just keep in mind that they may vary depending on the different types of credit cards available from an issuer.

Credit Card Issuer	Average Foreign Transaction Fee
Visa	0% or 3%
Mastercard	0% or 3%
Discover	0%
American Express	0% to 2.7%

Recommended: How Credit Cards Work

What Are Annual Credit Card Fees and When Are They Applied?

Some cards come with an annual credit card fee. This fee is a yearly charge collected by a credit card issuer in order to use the card. Often, paying an annual credit card fee allows cardholders to tap into special perks and benefits, such as higher credit card points earnings on purchases, extended warranties and price protection, and travel or cash back perks.

The annual credit card fee will turn up on your credit card statement once a year as a single lump-sum charge. Usually you’re charged during the same billing cycle or month in which you initially signed up for the card. Once you pay the annual fee, the next time you’ll get charged is in 12 billing cycles.

You’ll cover a card’s annual fee just like you would any other purchase you put on your card. The fee will show up on your card and get folded into your statement.

How Much Are Annual Fees Typically?

The amount of an annual fee depends largely on the card, but in general, annual fees can run anywhere from $95 per year to upwards of $500. There are a number of credit cards available that don’t charge an annual fee. And some that do also offer the opportunity to get the fee waived.

Do Cards With No Annual Fees Tend to Also Have No Foreign Transaction Fees?

Whether cards that skip out on charging annual fees will also have no foreign transaction fees varies. There’s no hard-and-fast rule. In some instances, a card might have an annual fee but no foreign transaction fee. On the flip side, a credit card might have a foreign transaction fee but no annual fee. Or a card could charge both fees or neither fee.

Before opening an account, it’s important to read the fine print and comb through the terms and fees of a given credit card. This will outline the fees a card might charge as well as the rate of credit card purchase interest charges. That way, you’ll know what you’re getting into with any given card.

Recommended: How to Avoid Interest On a Credit Card

No Annual Fee and No Foreign Transaction Fee Credit Cards: Who They’re Great For

Here’s a closer look at when a one-two punch of a credit card with no foreign transaction fees and no annual fee might best benefit you.

Online Shoppers

If you do a lot of your shopping online, particularly through brands that aren’t U.S.-based, you might find a no annual fee and no foreign transaction fee credit card beneficial. That way, if you happen to buy something from a merchant based in a foreign country and with credit card processing done in their local currency, you can save on foreign transaction fees.

Plus, if you have a strong credit score and can snag a card that offers a better-than-average rate of cash-back rewards or points, you might not need to splurge on a card with an annual fee to gain access to added perks.

International Travelers

Foreign transaction fees can rack up quickly if you’re putting purchases on your card while traveling in other countries. For instance, if you spend $5,000 on your credit card while on a trip overseas, and your card charges 3% for foreign transaction fees, that could cost you an additional $150.

To avoid this expenditure, you might be better off looking for a card that doesn’t have foreign transaction fees. You’ll further avoid cuts to your travel budget by skipping out on paying an annual fee.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score?

No Annual Fee and No Foreign Transaction Fee Credit Cards: Who They’re Bad For

If you fall within one of the following groups, you might not find that it’s worthwhile to focus on finding a credit card with no annual fee and foreign transaction fee.

People Who Want the Most Rewards and Perks

For those looking for the most competitive rewards rate, lucrative travel perks, or a sizable welcome bonus, then a credit card with an annual fee might be their best bet. By taking advantage of these benefits offered by the card, you could still come out ahead even with the annual fee, as the perks can effectively offset the cost of the fee.

Just make sure to do the math ahead of time and ensure you’ll take enough advantage of the available perks before agreeing to a hefty annual fee.

Recommended: Choosing a Rewards Credit Card

Those With Poor or Limited Credit

If you have poor credit or a limited credit history, you might not be faced with the choice of credit card miles vs. cash back when choosing a card. Instead, your options may be pretty limited. For those in this situation, a credit card that charges an annual fee and/or foreign transaction fees may still be their best — or only — available option.

By using your credit card responsibly, you may be able to build your score and qualify for a card with more competitive terms.

Tips for Save on Credit Card Fees When Traveling Abroad

Hoping to avoid credit card fees while you’re out of the country? Here are some pointers to keep in mind:

•   Ask about fees ahead of time. If you’re not sure which of your credit cards does or does not charge foreign transaction fees, it can pay to ask ahead of time. Then, you can opt to avoid using a card with a hefty rate for foreign transaction fees while you’re traveling. Even if you can’t avoid these fees entirely due to the credit cards you have, you’ll at least avoid a surprise when you get home from your trip and be able to spend more strategically.

•   Consider getting a no foreign transaction fee credit card. If you have the time ahead of your trip, can weather a dip in your credit, and are in the market for a new card, then getting a credit card with no foreign transaction fees can make sense. This is especially true if you have a number of trips abroad planned for the future.

•   Exchange cash before leaving the country. Another way to dodge fees while traveling is to exchange U.S. dollars for the local currency in the country you’re visiting before you leave. This will allow you to avoid potentially costly trips to the ATM and added fees when swiping your credit card. Just make sure to take safety into consideration before taking out a huge amount of cash.

Recommended: Can You Buy Crypto With a Credit Card?

The Takeaway

A no annual fee no foreign transaction fee credit card can save you money — especially if it comes with its own set of perks that you don’t have to pay extra for. Plus, you don’t have to keep as close an eye on your spending abroad so you can better kick back and enjoy the sights. However, these cards aren’t right for everyone. Understanding your financial goals and options can help you make the right decision for your situation.

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

What does it mean when a credit card has no foreign transaction fees?

A credit card with no foreign transaction fee means that you won’t get dinged with a fee should you make a purchase in a foreign country. Depending on how much you end up spending while traveling, it could save you a significant chunk of change.

Why are no annual fees important?

A credit card with no annual fee can mean you save money and access similar services without a surcharge. Plus, you won’t have to work as hard for the annual fee to pay off. In other words, you won’t have to strategize to make the most of any special perks, nor will you need to worry about spending a certain amount to offset the cost.

Is 3% foreign transaction fee a lot?

A 3% foreign transaction fee is on the high end of average. The rate of foreign transaction fees can vary, but they typically run anywhere from 1% to 3%, with some cards not charging any foreign transaction fees.

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Photo credit: iStock/RgStudio

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

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How old an authorized user has to be really depends on the credit card issuer. Some set the minimum age for an authorized user on a credit card at 13, while others require that an authorized user is 15 or even 16. Many issuers don’t specify a minimum age requirement at all.

In other words, it’s largely up to the adult’s discretion whether a minor seems old enough to become an authorized user. While it can serve as an educational tool and help build their credit, it also can lead to racking up debt and impacting both parties’ credit. You’ll want to make sure you know what you’re getting into in order to determine if it’s the right arrangement for you.

How Old Does an Authorized User Have to Be?

While the minimum age to get a credit card of your own is 18, an authorized user on a credit card can be as young as 13.

That being said, the minimum age for an authorized user on a credit card ultimately depends on the credit card company, as each issuer has its own age requirements. Some set the minimum age to 13 years old, while others may make authorized users wait to get a credit card at 16 or 15 (SoFi requires an authorized user to be age 15 or older). Some credit card issuers don’t specify a minimum age for authorized users on credit cards.

Factors to Consider Before Adding a Minor as an Authorized User

Before you add a minor as a credit card authorized user, consider the following factors.

Whether You’ll Have to Pay a Fee

Depending on the particular type of credit card and issuer, you might have to pay an additional annual fee to add an authorized user. For example, the Chase Sapphire Reserve card currently charges a $75 fee to add an authorized user.

Check with your card card issuer to see if you might get hit with a fee for adding authorized users to your account.

If They’re Old Enough to Handle the Responsibility

Even if you can add an authorized user as young as 13 to your card, doing so might not be in your best interest — or theirs. For instance, a child in their early teens might not have a basic grasp of managing finances, or they might not be mature enough to handle the financial responsibility and abide by basic credit card rules.

If you’re adding your minor as an authorized user to help them establish credit, a few years is enough time for them to be on their way. Plus, should you slip on your credit, it could also impact your child’s credit.

Recommended: How to Avoid Interest on a Credit Card

How You’ll Track the User’s Purchases

Most credit cards don’t issue unique card numbers to each authorized user. That means if you have multiple authorized users on an account, you won’t be able to easily figure out who made which purchases. Before you go ahead with adding an authorized user, make sure you have a system worked out so you’re not stuck covering their spending (unless you want to).

Whether You’ll Give Access to the Card

While you can give an authorized user their own card, you don’t have to, especially if you’re worried about how they’ll spend with it. If you’re strictly adding a child to your card to help them build credit, there’s no need to hand them a card. They don’t need to have access to your credit card number, either.

Steps to Add a Minor as an Authorized User

First and foremost, you’ll want to carefully weigh the pros and cons of adding someone under the age of 18 as an authorized user. If you have decided that you want to proceed, you’ll need to do the following.

1. Educate the Child About Credit Card Basics

Before adding a minor as an authorized user and giving them the privilege to spend on your card, sit them down and walk them through how credit cards work. For instance, you’ll want to explain what a credit limit is, how interest rates work, what one’s financial responsibility is when putting purchases on a card, and why it’s beneficial to build credit.

Recommended: What Is the Average Credit Card Limit?

2. Reach Out to the Credit Card Company

Next, you’ll need to contact the credit card company to let them know you’d like to add an authorized user to your card. You can do so by calling the number on the back of the card or by logging onto your account online.

You usually need to provide the following information about the individual you’re adding as an authorized user:

•   Name

•   Date of birth

•   Social Security number

•   Address (for them to receive the card)

•   Additionally, you may be able to set spending limits or restrictions for the authorized user at this point in the process.

3. Check Your Account

To make sure the authorized user was correctly added, log on to your account on the issuer’s website or through the app. Double-check to make sure the minor’s name and details are all correct. You might also receive an email notification informing you of this change.

The Cost of Adding an Authorized User

Many credit card issuers do not charge a fee to add an authorized user to an account. However, premium credit cards or cards that already charge annual fees, may charge an annual fee for adding authorized users. This fee may apply per authorized user, or you may pay a flat cost for up to a certain number of users.

Beyond this potential fee, there are other costs you could incur by adding an authorized user. For instance, additional purchases made by the authorized user could cause you to rack up a balance. Plus, their activity can impact your credit utilization, which could hurt your credit score.

Recommended: What Is a Charge Card?

Pros and Cons of Adding a Minor as an Authorized User

Here’s an overview of the advantages and downsides of adding a minor as an authorized user to your credit card:

Pros

Adding an authorized user can have the following benefits:

•   Can help build credit: A major upside of adding a minor as an authorized user is that it can help them establish credit at a young age. They’ll have a more firm financial footing as a result.

•   May allow you to earn more rewards: Another person making purchases on your card means there’s greater potential to earn more rewards. You can gain rewards more quickly than if you would if you were the sole user.

•   Serves as an educational tool: You may find that adding a minor as an authorized user to your card can help them learn credit basics and how to manage credit card debt, especially if you coach them through the process.

Recommended: Can You Buy Crypto With a Credit Card?

Cons

Beware of the potential downsides of having an authorized as well:

•   May cause you to rack up debt: It can be easy to rack up debt and overspend on the credit card with an authorized user. This is especially possible if you’re giving a child access to your card who is still wrapping their head around financial basics.

•   Can’t easily track who is making the purchases: Because purchases aren’t tracked by the authorized user, it might be tough to figure out which person was responsible for which transaction with your card. This is particularly tricky when you have, say, a joint account user and several authorized users.

•   Can impact credit of both primary cardholder and authorized user: If having additional users on your card equates to carrying a higher balance, that can up your credit utilization ratio. As credit usage makes up 30% of your credit score, you’ll want to keep that ratio under 30%, preferably closer to 10%. Beyond potentially hurting your credit, also know that any irresponsible credit behavior on your card can hurt your authorized user’s credit. For instance, if you are late on a credit card payment, both your credit and the credit of the minor you added to your card can suffer.

Recommended: When Are Credit Card Payments Due?

Tips for Managing a Minor as an Authorized User

If those possible downsides are making you nervous, here are a few things you can do to ensure your minor uses their privileges responsibly:

•   Set limits. Talk to your child and give them an amount they can spend on the card each billing cycle. Also, determine if they’ll be responsible for helping you pay off their share. Or perhaps you might consider an alternative arrangement, such as doing chores around the house to cover purchases they made on their credit card. Hash this out beforehand.

•   Treat the card as a teaching tool. Sit down with your child and go over basics of a credit card, such as how interest fees work, how to read a billing statement, and what can happen if you’re late or miss a payment. You’ll also want to teach them how repayment works.

•   Set alerts. To keep an eye on your child’s spending, consider setting alerts on your credit card. You can set it up so you get notifications for transactions over a certain amount, or any transactions made online, in person, or over the phone.

Recommended: Tips for Using a Credit Card Responsibly

Removing a Minor as an Authorized User

Removing a minor as an authorized user from a credit card is a relatively simple and painless process. To do so, you call the number on the back of the card and let them know the name of the person you’d like taken off. If you have several authorized users on a card, be sure to specify which card user you’re removing.

It’s not a bad idea to leave a paper trail and send a letter to the credit card company reiterating that you’ve requested the change over the phone.

The Takeaway

The minimum age for an authorized user on a credit card varies depending on the credit card issuer. Some require an authorized user to be 13, while others set the age limit at 15 or 16 or even have no formal limit at all. Before adding a minor as an authorized user on a credit card, you’ll want to carefully weigh the pros and cons before doing so. If you decide to add a child as a user, set some ground rules and teach them credit and financial basics beforehand.

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

Do some issuers allow authorized users with no minimum age?

Usually the minimum age requirement to add an authorized user to a credit card is at least 13. However, there are several credit card issuers that don’t note a specific minimum age.

How many authorized users can I add to my account?

It depends on the credit card issuer. Some allow, say, between four and seven, while others have no limit as to how many authorized users you can add to a credit card. The number of authorized users might also depend on what type of card it is, such as a rewards or travel credit card.

Is an authorized user relationship or a joint account holder better?

It depends on what kind of privileges you want the additional card user to have and the reason you’d like to add them. If you want to help build someone’s credit and not have them responsible for making payments, then an authorized user could be the better route. If you’d like the user to be equally responsible for making payments and have access to make changes on the account, a joint account holder might make sense.

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Photo credit: iStock/Manuel Tauber-Romieri

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Third Party Trademarks: Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER®, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.

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A black credit card is a financial product extending a line of credit to wealthy, high-spending consumers. Colloquial references to a black credit card typically refer to the American Express Centurion Card that launched in 1999. It quickly developed a reputation for being more than a credit card — rather, it became a status symbol of ultra wealth and almost limitless spending power.

Here’s a look at what a black credit card is in detail, how to get one, and the card’s benefits and drawbacks.

What Is a Black Credit Card?

A black credit card is an ultra-luxury private banking credit card product that’s designed to support the credit needs of the world’s wealthiest individuals, which can include A-list celebrities, professional athletes, and multi-millionaires. These are individuals who likely spend six figures a year using their credit card.

Although the black credit card meaning was originally derived from the AmEx Centurion Card, it now includes other luxury cards that have since come to the market. The list of exclusive card products include the Dubai First Royale Mastercard and the J.P. Mortgage Reserve Card.

Although the Mastercard Black Card might have the phrase “black card” in its name, it’s more accessible and arguably not in the same caliber as the aforementioned cards. That’s because consumers can submit an application online for this card without first being invited, which is more in line with typical credit card rules.

How Black Credit Cards Work

Unlike other consumer credit cards, the most exclusive black credit cards aren’t available for online applications. Card issuers publish very limited details — if any at all — about how to apply for the card or what it takes to receive an invitation. All of the elusiveness can enhance the allure of black cards.

Aside from their exclusiveness, black cards are generally known for having no credit limit, allowing members to spend freely. However, credit card issuers have already determined who they feel is financially capable of wielding the black card’s limitless buying power.

Recommended: Does Applying for a Credit Card Hurt Your Credit Score?

Requirements for Getting a Black Credit Card

Specific black credit card requirements and thresholds vary between black card products. However, they generally include the following factors:

•   Minimum annual spending

•   Income and/or net worth

•   Creditworthiness

If you believe that you meet the criteria for a black credit card, you can reach out to the card issuer directly to see if you’re eligible. American Express, for instance, may offer existing members an online form for its Centurion Card for those who want to request consideration.

Worth noting: The Centurion Card is currently said to have a one-time $10,000 initiation fee and an annual fee of $5,000 thereafter.

Recommended: The History of Credit Cards

What Kinds of Perks Do Black Credit Cards Offer?

Whether you’re still learning how credit cards work or are experienced with credit, you likely know that different cards offer varying benefits, including rewards, travel and shopping credits, and more. The perks of a black credit card also differ depending on the type of black card.

For example, the AmEx Centurion Card, offers the following black card benefits:

•   VIP airport lounges. Access to AmEx’s Global Lounge Collection, including the coveted The Centurion Lounge.

•   Travel accommodation enhancements. Upgraded bookings and credits through AmEx’s Fine Hotels and Resorts program, with 900 hand-selected, iconic properties, and elite status with additional hotel programs.

•   Airline loyalty status. Complimentary top-tier status through airline partner loyalty programs.

•   Unique experiences. Access to one-of-a-kind travel experiences around the world.

•   Travel inconvenience credit. Up to a $2,000 credit per traveler for carrier-related inconveniences, like delays, and up to $10,000 for canceled trips.

•   Travel insurance. Up to $100,000 in travel medical assistance, and up to $1 million in travel accident insurance.

•   Rental car insurance. Up to $75,000 in car rental loss and damage insurance.

•   Saks Fifth Avenue credit. Quarterly $250 shopping credit, up to $1,000 per year.

•   Equinox fitness club membership. Access to clubs in multiple countries.

•   Additional buying protection. Purchase protection, return protection, and extended warranty for goods purchased on the card.

•   Personalized support. Access to personal shoppers and 24/7 personal concierge service.

As noted above, fees, benefits, fees, and spending requirements will vary among different types of credit cards, including those that fall into the ultra-luxury category.

Recommended: What Is a Charge Card?

Pros and Cons of Using a Black Card

As a card that’s not intended for the masses, the card’s pros and cons highly depend on which side of the eligibility spectrum you fall under. Here’s a closer look at black credit card benefits and drawbacks:

Pros of Using a Black Card	Cons of Using a Black Card
No credit limit	Accessible by invitation only
Status symbol	High initiation and annual fees
Luxury perks	High spending requirement
Tailored service experience	High income requirement

Is a Black Credit Card Worth It?

With a reputation of having excessively high annual fees and high minimum spending criteria, a black card can carry a high price tag. It’s important to consider that you can afford this kind of credit card — that is, assuming you’ve received an invitation in the first place.

Weigh the black card benefits, and consider if you’d actually be using a credit cardin such a way that it would be worth it for your needs.

Recommended: When Are Credit Card Payments Due?

The Takeaway

Black cards are typically reserved for wealthy customers who have demonstrated the ability to spend hundreds of thousands on a credit card and repay that amount with ease. If you’re an everyday consumer or it’s your first time getting a credit card, a pricey black card probably isn’t a practical credit card solution.

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

What does it mean to have a black credit card?

Being invited as a black card member means that you’ve met the card issuer’s underwriting criteria in terms of having a high income, high net worth, high spending activity, and more. It’s perceived as being a card that’s only accessible to ultra-wealthy individuals.

How much does a black credit card cost?

Black credit card fees vary between card products but often cost hundreds to thousands of dollars in annual fees each month. The AmEx Centurion Card, for example, has a $10,000 initiation fee and a $5,000 annual membership fee thereafter.

Are black credit cards actually black?

Generally, black credit cards are designed with a black color scheme. However, some of these cards that fall into the exclusive black card category aren’t black. For example, the J.P. Morgan Reserve card is made of brass and palladium and has a silver metal finish.

What is the difference between a black card and a platinum card?

The AmEx Platinum Card is more accessible to consumers than the AmEx Centurion Card, also dubbed the black credit card. Members who want to apply for a Platinum Card can do so on their own online, while the black card is offered by invitation only. The requirements and annual membership fees of both cards also vastly differ, with the black category charging higher fees and having higher spending requirements as well as more robust perks.

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Photo credit: iStock/Lemon_tm

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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For those stumped about which presents to buy, a top gift that parents and grandparents really hope to find under the tree this season is a gift card, according to an exclusive survey.

If you’re like many people, you plan to spend a considerable amount on loved ones as you celebrate this winter. For instance, one recent Gallup poll revealed that Americans plan to spend over $1,000 on gifts (a new high) for the 2024 holidays. But there’s no need to stress or spend tons of time hunting because you’ll know exactly what to buy.

Here, in our exclusive survey of 1,000 individuals (250 of each — moms, dads, grandmothers, and grandfathers), you’ll learn the holiday present they really want this season — and what they don’t want. Get ready to find out and then get shopping!

Source: Based on a What People Actually Want This Holiday Season survey of 1,000 U.S. adults from October 26, 2022 to October 27, 2022.

Gift Cards Are the Favorite Gift by Far

The number-one gift requested by moms, dads, grandmothers, and grandfathers is … a gift card! And it wasn’t even close. Gift cards were the most-requested gift across the board.

Almost 33% of respondents picked gift cards as their most-wanted holiday gift. Here’s how it breaks down across the generations:

•   Moms: 39%

•   Dads: 31%

•   Grandmothers: 34%

•   Grandfathers: 27%

The Type of Gift Card You Give Makes a Difference

There are all kinds of gift cards to choose from, including gift cards for restaurants, stores, and airlines, to name just a few. So, as you get ready to shop and celebrate the holidays without blowing your budget, which type should you get for your parents and grandparents?

A gift card that can be used anywhere, like a Visa gift card, was the top choice, selected by:

•   45% of moms

•   44% of grandmothers

•   40% of grandfathers

•   38% of dads

The one group that wants a different kind of gift card? Moms ages 35 and up. They preferred a gift card to a retailer like Target, Amazon, or Walmart.

The way gift cards function is similar to how credit cards work, since your parents and grandparents can use them to buy whatever they like. Perhaps that’s why they were so popular in our survey: Your relatives can pick out exactly what they want.

Recommended: Breaking Down the Different Types of Credit Cards

Skip the Fancy Jewelry

You might think mom would be thrilled with luxury goods like an expensive necklace, bracelet, or earrings, but jewelry is actually at the very bottom of her list. When asked the gift they wanted least, most moms (22%) said fine jewelry. Dads agreed — 21% chose fine jewelry, such as a watch, as their least favorite holiday gift.

Grandparents also said no thanks to fine jewelry:

•   26% of grandmothers picked it as their least favorite gift

•   21% grandfathers chose at gift they wanted least

Recommended: Secrets to Not Paying Full Price

Holiday Gift Ideas for Mom

Here’s what Mom wants most:

•   A gift card: 39%

•   No gift at all — she just wants to spend time with family: 14%

•   An experience (like a concert or vacation): 10%

•   Clothes or shoes: 9%

•   A homemade gift like a photo collage: 7%

•   Electronics: 6%

•   Jewelry: 6%

•   Home goods: 5%

•   Donation to a charitable organization: 3%

•   Beauty/health products: 2%

Holiday Gift Ideas for Dad

Here’s what dad wants most:

•   A gift card: 31%

•   Electronics: 14%

•   No gift at all — he just wants to spend time with family: 12%

•   An experience (like a concert or vacation): 12%

•   Clothes or shoes: 10%

•   Jewelry: 9%

•   A homemade gift like artwork: 5%

•   Donation to a charitable organization: 4%

•   Home goods: 2%

•   Beauty/health products: 2%

If you’re thinking about getting dad the electronics he wants, but you don’t have the cash to pay for the gift upfront, applying for a credit card, and charging the electronics to it, is an option you may want to consider.

Holiday Gift Ideas for Grandmothers

•   A gift card: 34%

•   No gift at all — she just wants to spend time with family: 22%

•   An experience (like a concert or vacation): 12%

•   Clothes or shoes: 8%

•   A homemade gift like artwork: 6%

•   Electronics: 5%

•   Jewelry: 4%

•   Donation to a charitable organization: 3%

•   Home goods: 3%

•   Beauty/health products: 2%

Holiday Gift Ideas for Grandfathers

•   A gift card: 27%

•   No gift at all — he just wants to spend time with family:14%

•   Electronics: 12%

•   An experience (like a concert or vacation): 10%

•   A homemade gift like artwork: 10%

•   Clothes or shoes: 8%

•   Donation to a charitable organization: 8%

•   Home goods: 5%

•   Jewelry: 4%

•   Beauty/health products: 2%

Recommended: 41 Charities to Support This Year

Who Buys the Best Gifts?

It’s unanimous: Moms, dads, grandmothers, and grandfathers all agree that their spouse or partner is tops when it comes to choosing holidays gifts. No other person even comes close.

Who Gives the Best Gifts?

•   Spouse/partner: 37%

•   Parents: 18%

•   Friends: 10%

•   Siblings: 9%

•   Other relatives: 9%

Whose Gifts Rate the Worst?

Ranking at the bottom of the best gift-giver list: In-laws and bosses. Only 4% of respondents said their mother-in-law and father-in-law give good gifts, and just 1% said their boss does.

Regifting is Real — and It Can Be Pretty Awkward

There’s a lot of regifting going on: 41% of our respondents admitted they’ve done it. But when the tables are turned on them, things can get a little uncomfortable. Fortunately, many have a sense of humor about it.

Almost 1/3 of Moms Have Been Regifted a Gift They Gave First

•   68% thought it was funny

•   32% were hurt, annoyed, or mad

Yet this didn’t deter them from doing it themselves: 38% of moms have regifted what they didn’t want. Most of these unwanted gifts were from friends.

Almost Half of Dads Have Been Regifted a Gift They Gave

•   71% thought it was funny

•   28% were hurt, annoyed, or mad

Dads are even more likely than moms to regift: 47% of them have done it — mainly with presents from distant relatives.

Lots of Unwanted Gifts Are Sitting in a Closet Someplace

When they get a Christmas present they don’t want or need, the overwhelming majority of respondents said they hang onto them, rather than exchange them. This was the answer chosen by:

•   80% of grandmothers

•   79% of moms

•   74% of grandfathers

•   70% of dads

(Perhaps eventually they decide to sell their unwanted stuff, however. It can be a good way to bring in some cash.)

So Whose Gifts Do They Take Back?

Of those parents and grandparents who return or exchange gifts:

•   Moms are most likely to return gifts from friends

•   Dads are most likely to return gifts from parents or other relatives

•   Grandmothers are most likely return gifts from distant relatives

•   Grandfathers are most likely to do return gifts from distant relatives or coworkers

Recommended: Tips for Using a Credit Card Responsibly

Plenty of Moms and Dads Are Wishing for a Vacation

If you splurge and get your parents a trip as their holiday gift, expect them to waste no time in packing their bags. Of the moms and dads who chose an experience as the gift they most want for the holidays, taking a vacation was at the very top of the list.

While paying for a vacation can be expensive, you might want to think about splitting the cost with your siblings or putting it on your credit card to help cover the cost. This is one reason why getting a credit card can be helpful when you’re buying holiday gifts.

Time Together Might Be the Greatest Gift of All

You may not need to get your parents a lot of presents (besides a gift card, that is!). A number of moms and dads who took our survey said they wanted family time over the holidays more than anything. In fact, for moms, spending time with family is their second most-wanted gift.

For dads, family time came in third. Electronics like gaming systems edged it out slightly.

Grandmothers and grandfathers want to spend time with family most of all. Each of them chose it as their second favorite gift option.

The Takeaway

One specific holiday gift will please your parents and your grandparents this year: a gift card. Not only does this make your shopping easier, but it gives your loved ones exactly what they want. A gift card that can be used anywhere, like a Visa gift card, is what the respondents to our survey wanted most.

If you’re looking for other gift options, dads are partial to electronics, like gaming equipment, and both moms and dads would be happy to find airline tickets for a vacation in their stocking.

One way to fund holiday gifts can be by using a credit card.

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.

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Photo credit: iStock/seb_ra

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

This content is provided for informational and educational purposes only and should not be construed as financial advice.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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If you’re someone who swipes your credit card for pretty much anything and everything, you know just how disruptive a hold placed on your card can be. This could happen at any time — when you fill up your tank at the gas station or when you pay for a hotel room during a weekend getaway. It can feel like the cash flow equivalent of the power getting shut off in your home.

The good news is that credit card holds are only temporary. And chances are, you’ll be able to tap into your credit card in no time. Learn what a credit card hold is, how long a credit card company can hold your payment, and more.

What Is a Credit Card Hold?

A credit card hold is a two-part process in which the merchant and credit card issuer communicate with one another electronically. On one side, a merchant checks with your card issuer ahead of time if you’re good for a specific, preset amount. On the other side, the card issuer locks in that amount on your credit card balance. That way, the merchant ensures it is paid for the purchase.

In turn, due to how credit cards work, you won’t have access to that amount that’s set aside until either the transaction or the issue gets resolved and the hold is released.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

Types of Credit Cards Holds

Here’s a closer look at the two main types of credit card holds: authorization holds and administrative holds.

Credit Card Authorization Hold

A credit card authorization hold is usually the more complex of the two types of holds. They’re also known as “pre-authorizations,” and you can think of them as a security deposit.

A credit card authorization usually happens when you’re using a credit card to make a larger purchase or when the final amount of the transaction is unknown. Merchants in industries such as car rental companies, gas stations, and hotels commonly use these authorization holds. Other industries where a card isn’t present may also make a request.

How Does An Authorization Credit Card Hold Work?

Here’s how it works: When an authorization hold on a credit card is requested, the card issuer makes a portion of your credit card balance unavailable until the transaction is finalized.

For example: Say you book a hotel room, and the grand total is $1,000. The hotel asks the card issuer for a hold. In that case, the issuer will make that $1,000 of your credit limit unavailable. Once the transaction goes through, the authorization hold will be lifted.

Depending on the situation, there might be two authorization holds placed on your credit card. For instance, if you used your credit card to pay for a hotel stay, the first hold would be for accommodations. The second might be for the tab at the mini-bar in your room or for the restaurant bill.

Recommended: What is the Average Credit Card Limit

How Long Does an Authorization Credit Card Hold Last?

An authorization credit card hold can typically last anywhere from one to 30 days. Some holds might be released the same day, while others last for a few days after the transaction is settled. For instance, a hotel hold is usually released a few days after you checkout, while a hold placed by a gas station might be lifted the day you spend money at the pump.

If the transaction doesn’t settle before a hold reaches its expiration, the hold will fall off, and the amount that was held will become available again.

Credit Card Administrative Hold

The other main type of credit card holds are administrative holds. Administrative holds can be broken down into two types:

•   Over-the-credit-limit administrative hold: As the name implies, if you go over your credit card limit, an administrative hold will be placed. And yes, you’ll be barred from using your card until you pay down your card so it falls below the credit limit. This is why it’s important to follow the credit card rule of spending within your limit.

•   Late-payment administrative hold: If you’re behind on your credit card payment, your credit card issuer may place a late-payment administrative hold on your card. In this case, one of two things can happen. If you have a solid credit history, the card issuer might only report the late payment to the credit bureaus, and allow you to continue using your card. But if you keep making late payments or your credit is less-than-stellar, a late-payment hold might be placed until you make several months of on-time credit card payments.

Recommended: When Are Credit Card Payments Due?

When to Use an Authorization Hold

As a cardholder, an authorization hold isn’t really something you have control over. That’s because the merchant is the party that reaches out to the credit card issuer and requests a hold. This is done as a form of security to ensure the merchant gets paid for a purchase.

That being said, there are things you can do to prevent an authorization hold from happening in the first place. (More on that in a moment.)

When Not to Use an Authorization Hold

It’s up to the merchant whether or not to use an authorization hold. This might be requested if there’s a big question mark hovering over the final amount of the transaction.

Such holds are also requested when it’s worthwhile for a merchant to request a hold, given what a credit card is and how they work. This could include if the purchase is for a larger amount, or if the merchant works in an industry where there’s a high rate of non-payment for purchases.

Tips to Avoid Credit Card Holds

You can avoid credit card holds by doing the following:

•   Use a card in-store. To avoid authorization holds, go inside the store and pay at the counter instead of paying online or at the pump.

•   Check the policy beforehand. If you’re concerned about a hold being placed on your account, reach out to the hotel or car rental company ahead of time. See what their authorization hold policy is and what the typical amount and length of the hold is.

•   Check your credit card balance. If you plan on booking a hotel room or car rental, do a quick check of your credit card balance and your card limit. If you’ve already used a lot of your current balance and might go past your limit, consider using another card, or looking for less-expensive options so you can stay within your limit.

•   Pay your card balance. To keep your credit card limits low, aim to pay off your credit card balance. To stay out of late-payment territory and avoid late-payment holds, always make the credit card minimum payment.

Steps for Removing an Authorization Hold

While the merchant can release an authorization hold at any time, as the card holder you’ll need to jump through a few additional hoops to do so. Here’s what you need to do to lift an authorization hold:

•   Request that the hold get lifted right away. As some holds linger a few days after the bill is paid, ask the merchant if the hold can get released as soon as the bill is paid and the transaction settled.

•   Ask the credit card issuer if the hold can be removed. You can also reach out directly to the card issuer to see if a hold can be lifted. In this case, the issuer would contact the merchant and make the ask on your behalf.

The Takeaway

A credit card hold can be a nuisance, but you can also avoid one by taking a few steps. This includes checking your available balance before making a charge and always making sure to make the minimum payments. And if a hold is lingering for longer than you’d like, you can always request that the hold is removed.

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

How do I remove a credit card hold?

You can remove a credit card hold by reaching out directly to the credit card company or to the merchant.

How long does a pending authorization hold take?

It depends. If it’s an authorization hold from a gas station, the hold can get lifted the same day. If it’s a hold from a hotel or car rental, where the amount you’ll be putting on the card is unknown, it can often take several days after you’ve settled the final bill for the hold to be lifted.

What can go wrong with an authorization hold?

There’s a chance that a hold can remain on your card after it’s been canceled or settled. In that case, the funds you have available through your line of credit will be limited. If this happens, you should reach out to the credit card issuer to have the hold released.

Can authorization holds prevent chargebacks?

A benefit of authorization holds is that they can prevent chargebacks for the merchant. (A chargeback is when the consumer disputes a charge and requests a refund, in which case the credit card company would withhold the funds from the merchant until the dispute is resolved.) Placing a hold would allow the merchant to avoid this scenario because they can delay processing the transaction.

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Photo credit: iStock/Alesmunt

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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