Benefits of being added as an authorized user

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Adding a loved one — whether it's a partner, child or another family member — as an authorized user on a credit card can help in many different ways.

For one, it might simplify things. Instead of putting expenses on multiple cards and settling up after the fact or paying multiple different bills each month, you can simply divide one bill between two people or pay from one shared account, depending on your situation, of course. Plus, the primary cardholder earns all the points, which could help if the authorized user didn't care about points anyway.

But there are other perks that come with adding someone as an authorized user, too. In this edition of Quick Points, we'll take a closer look at these benefits and discuss how this can help you earn more points and benefit the authorized user at the same time.

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Benefits of adding an authorized user

Beyond just simplifying expenses, there are some lesser-known benefits to adding authorized users to your credit cards. Some of these include:

• The primary cardholder earns rewards on all transactions — and after all, if you're liable for paying an expense, you might as well reap the rewards, too.
• Likewise, the authorized user's spending usually counts toward the minimum spend requirement for welcome offers.
• The authorized user will build credit when you pay your card on time, which can be beneficial if you add your child as an authorized user.
• Speaking of children, authorized user cards generally have lower age requirements. For example, American Express lets those as young as 13 years old become authorized users. Chase doesn't have a minimum age limit.
• Some premium cards let authorized users access travel benefits. For example, Citi® / AAdvantage® Executive World Elite Mastercard® authorized users 18 or older can access Admirals Club lounges with their card when flying with American Airlines or another Oneworld carrier.

In most cases, authorized users are still eligible for the card's welcome offer if they decide to apply for their own card down the road. So if you add your partner as an authorized user on your Capital One Venture Rewards Credit Card and they later decide to open their own card, they're still eligible for whatever welcome bonus the card is offering when they apply.

Related: Credit cards with the greatest value for authorized users

The risks of adding (and being) an authorized user

Adding an authorized user doesn't come without risks.

The main risk of adding an authorized user to your account is that you're still liable to pay all charges posted to the account, even if your authorized user makes the purchase. With this in mind, you should only add extremely trusted individuals as authorized users on your card.

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One way to mitigate this risk is by adding spending limits to authorized user cards. Not all banks offer this, but the most notable is American Express. You can add limits as low as $200 to American Express authorized user cards.

Further, authorized users take on some risk when being added to someone else's account, too. If the primary cardholder doesn't pay their bill on time, the authorized user's credit may also suffer. That said, in most cases, the authorized user will not be held liable for charges made to the account if the primary cardholder doesn't pay their bill.

If you find yourself in this situation, call the issuing bank and ask to be removed as an authorized user. You can then dispute the late payment with the credit bureaus if necessary.

Related: How to save your credit score after a late payment

Bottom line

Adding a relative or another very trusted person as an authorized user is a great way to build up your points stash while helping that person build credit and take advantage of various perks. But before you add an authorized user to your account, make sure you're comfortable with the risks.

Feature photo by Maskot/Getty Images

Featured image by Getty Images/Maskot

Editorial disclaimer: Opinions expressed here are the author’s alone, not those of any bank, credit card issuer, airline or hotel chain, and have not been reviewed, approved or otherwise endorsed by any of these entities.

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• Steep annual fee
• Difficulty meeting $15,000 welcome offer for smaller businesses
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• Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com, and 1X points for each dollar you spend on eligible purchases.
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TPG Exclusive Offer

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Rewards Rate

• Intro Offer

  Earn 150,000 points

  120,000 points

• Annual Fee

  $695

• Recommended Credit

  670-850

  Good, Excellent

Why We Chose It

It's hard to find a card that competes with the mile-long list of benefits that come with the Amex Business Platinum. While it's certainly not the card for the average consumer, a business owner with tons of expenses -- especially related to travel -- will find this card incredibly valuable. This card is similar to the consumer version that Amex offers, but with more business-oriented perks around statement credits and earning rates that are a better fit for business owners.

Pros

• An up to $100 credit for Global Entry or TSA PreCheck application fee every four to five years
• Up to $400 annual credit for eligible U.S. Dell purchases (enrollment required)
• Gold status at Marriott and Hilton hotels (enrollment required)
• Access to the Fine Hotels & Resorts program and Hotel Collection
• Extended warranty protection
• International Airline Program and Cruise Privileges Program

Cons

• Steep annual fee
• Difficulty meeting $15,000 welcome offer for smaller businesses
• Limited high-bonus categories outside of travel

• The Points Guy Exclusive Offer: Earn 150,000 Membership Rewards® points after you spend $15,000 on eligible purchases with the Business Platinum Card® within the first 3 months of Card Membership.
• Get 5X Membership Rewards® points on flights and prepaid hotels on amextravel.com, and 1X points for each dollar you spend on eligible purchases.
• Earn 1.5X points (that’s an extra half point per dollar) on eligible purchases at US construction material & hardware suppliers, electronic goods retailers and software & cloud system providers, and shipping providers, as well as on purchases of $5,000 or more everywhere else, on up to $2 million of these purchases per calendar year.
• Unlock over $1,000 in annual statement credits on a curation of business purchases, including select purchases made with Dell Technologies, Indeed, Adobe, and U.S. wireless service providers.
• $200 Airline Fee Credit: Get up to $200 in statement credits per calendar year for checked baggage fees, lounge day passes, and more at one selected airline.
• $189 CLEAR® Credit: Use your Card and get up to $189 back per year on your CLEAR® membership. CLEAR® is available at more than 50 U.S. airports and stadiums.
• The American Express Global Lounge Collection® can provide an escape at the airport. With more than 1,400 airport lounges across 140 countries and counting, you have more lounge location options than any other credit card on the market as of 9/2021.
• $695 Annual Fee.
• Terms Apply.