Many Tennessee residents have added a friend or loved one to one or more of their credit cards. Adding someone as an "authorized user" can help boost their credit score, and is a great tool for someone who is just starting to establish credit, or is recovering from a serious credit score setback. This act of kindness, however, can come back to bite the original borrower if the privilege is abused. Far too many people have seen their credit card debt rise based on the actions of an authorized user.
Some people add authorized users in an attempt to earn more reward points. They may never intend for the users to actually charge items on the account. Other people share their account with a live-in boyfriend or girlfriend, for the purpose of covering shared household expenses. If the relationship goes sour, the authorized user could rack up quite a bill before the other party is aware of the spending.
At the end of the day, the primary account holder is the one who is responsible for paying the debt, not the authorized user. That is why individuals must make a careful and conscious decision when they add another party to their account. Be clear about the expectations for use of the credit card, and follow up on spending by checking the account use on a regular basis. As soon as there seems to be an issue, take back the authorized user's card, and have their name removed from the account.
As many Tennessee residents know, it is easy enough to get into trouble with credit card debt on one's own, without the help of another party. Adding an authorized user to one's account is a risk, and should be treated like one. While this arrangement can work out for many people, it requires a great deal of trust, respect and adherence to the established rules in order to work for both parties. If those elements are not in place, then it may make sense to choose a different means of helping the friend or loved one.
Source: bankrate.com, "When an authorized user goes rogue: What to do", Erica Sandberg, March 29, 2017