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Why You Need a Credit Card Account in Your Own Name

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Debit_HakanDahlstrom_CCFlickrI recently heard from a reader (let’s call her Diane) who was going through a difficult time. Her husband had recently died and she suddenly realized she had very little credit in her own name.

Her late husband had been keeper of the finances and he’d done a great job with it. Diane was an authorized user on their credit cards, but her husband was the official account holder on all of them. Diane had assumed that her husband’s great credit—and his excellent credit score—also belonged to her because they were married.

“A common misunderstanding with married couples is that all their credit is joint credit since they are married. This is not the case. Credit reports are created and maintained on an individual basis. So, any credit you had before you were married or have obtained individually while married would only be seen on your credit report—not on that of your spouse. All joint credit would be reported on both spouses’ credit reports,” says Tom Quinn, consumer credit expert for Credit.com.

This really isn’t common knowledge, so I told Diane she shouldn’t be too hard on herself. She wanted to get a credit card in her own name so for her first step, I suggested that she obtain her free credit reports from the three major credit reporting bureaus as well as her credit scores. Looking at this information will tell her where she stands with her credit history and whether her score is high enough to qualify for an unsecured credit card.

When you have a significant other, it can be tough to recognize the best choices when it comes to credit card accounts. Going the “authorized user” route isn’t a bad choice if you’ve each established your own credit history. Another option for couples is to become joint account holders on a credit card. Here’s a quick rundown of the legal and credit-related differences between being an authorized user and being a joint account holder.

[Related article: Your Credit Report: A Resume, Not a Rap Sheet]

Authorized Users »

Image: Håkan Dahlström, via Flickr

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  • http://www.mickeygoodman.com Mickey

    Thank you for writing this article. This is information so many older women need. When we were young adults, a wife HAD to be listed as “Mrs. John Smith,. She was not allowed to use her first name (not even on voter registration forms!) It’s no wonder women have assumed that their husband’s credit was automatically theirs. I insisted that my daughter establish her own credit at an early age, and it has served her well.

    • Beverly Blair Harzog

      Mickey, it’s great that you’ve encouraged your daughter to establish her own credit at an early age. Kudos to you! And wow, that’s so interesting that years ago women had to be listed using their husband’s name!

  • JB McDaniel

    Great story, Beverly. This exact thing happened to my mother-in-law — the credit card companies canceled all her cards when she called to tell them her husband had died, and she had trouble getting a new one because she did not exist in the credit world. I also have three friends of varying ages who have been widowed in the past year — and they all have horror stories about dealing with banks, water and power utilities, credit cards — you name it. A real eye-opener.

    • Beverly Blair Harzog

      JB, thanks so much for sharing those stories. This situation is really quite common. I’ve talked with so many women recently who either experienced this or know someone else who has.

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