18 year old credit card question

[Anonymous]

I've done authorized user for years, but it is not a great way to build credit. It counts but not the same as having their own account. When my daughter turned 18 I had her open a secured card TD Cash $300 limit) and I make the payments. Once it graduates to unsecured I will have her open a regular card and that will be my contribution to her credit building life as an adult. After educating her, of course.

[Anonymous]

My son tried to apply for a card at 18 and was declined. So now he has that on his record. Instead we added him to our credit card as an authorized user. We had all sorts of talks about how it would be revoked it he ever used it without telling us first. Over the first year he used it like twice to just show he was using it, and to add to his credit score. Now in his junior year he gets all sorts of applications at our house to apply for his own. We will let him stay on our if he keeps following our rules, then when he graduates he should have his own credit score to fall back on.

[Anonymous]

Anonymous wrote:Discover does special student credit cards. Got my now 20 year old one about 8 months ago, and DC now has a nice high credit score!
When you fill out the application for income, I believe they allow monthly parent contributions (towards rent, other living expenses, payment of cell phone, etc) to count as income. I conservatively entered something like 2K per month (when you factor what you spend on room and board!) + DC's summer earnings... it was enough to get a 1200 LOC. And then after 5 months Discovered up'ed the credit after responsible use, paying off the cc each month.

But I think the point is YOU filled out this credit card application for him? isn't that for him to do?

[Anonymous]

Anonymous wrote:

Anonymous wrote:You don’t want I’m to be authorized user on your cc because your credit limit will be much higher than what he needs. Also if card is stolen or he overspends then hard to deal with the headache. Not to mention that he can start establishing credit on his own credit card and learn to be responsible and pay own bills.

Some credit cards allow you to set spending limits for authorized users. Our AmEx card, for example, allows limits. We’ve made our kids (one in college, one in high school) authorized users on our AmEx card, but have set the spending limits pretty low (a few hundred bucks). And one benefit of having the kids be authorized users is that we get the miles/points from cc spend

This is what we did. With regard to the limits, we did discover that gas stations will “reserve” a significant amount (like $100+ bucks or so) when a card is used at a pump, and the gas station will reject the card if there isn’t that much room in the card limit. So DC ended up with a much higher limit than they would have otherwise. I just checked the other day, and the credit card is reporting the card to the credit rating agencies for DC, so it is the same from a credit building standpoint.

[Anonymous]

When my son was 18 we went into Bank of America for notary services. My son had had a debit card there for a couple years at that point. They said, while you are here, would you like a credit card? As another poster noted above, they inputted his income as what I spend in a month on him. So we just made something up, like 2000$ or something. Approved. It has a pretty low limit but has been fine for him at college. I did apply on his behalf (with his permission) to a United Explorer card about 5 months after that to try to get him free bag check on his flights to and from school when I was booking his Christmas flights, but he did get denied for that one. I apologized to him for dinging his credit, but oh well. I assume his credit history is not extensive enough to get that particular card at this point.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:You don’t want I’m to be authorized user on your cc because your credit limit will be much higher than what he needs. Also if card is stolen or he overspends then hard to deal with the headache. Not to mention that he can start establishing credit on his own credit card and learn to be responsible and pay own bills.

Some credit cards allow you to set spending limits for authorized users. Our AmEx card, for example, allows limits. We’ve made our kids (one in college, one in high school) authorized users on our AmEx card, but have set the spending limits pretty low (a few hundred bucks). And one benefit of having the kids be authorized users is that we get the miles/points from cc spend

This is what we did. With regard to the limits, we did discover that gas stations will “reserve” a significant amount (like $100+ bucks or so) when a card is used at a pump, and the gas station will reject the card if there isn’t that much room in the card limit. So DC ended up with a much higher limit than they would have otherwise. I just checked the other day, and the credit card is reporting the card to the credit rating agencies for DC, so it is the same from a credit building standpoint.

It is helpful and contributes to a positive rating, but is by no means the same

[Anonymous]

Anonymous wrote:I've done authorized user for years, but it is not a great way to build credit. It counts but not the same as having their own account. When my daughter turned 18 I had her open a secured card TD Cash $300 limit) and I make the payments. Once it graduates to unsecured I will have her open a regular card and that will be my contribution to her credit building life as an adult. After educating her, of course.

My DD just got her own card after only being authorized on ours. I guess in her case it helped alot because her credit score was in the upper 700's...a few points over ours!! She is 20 and has an interns salary!