Will adding someone as an authorized user hurt their credit?

Authorized User: Access to Credit, Not Credit Impact

Adding someone as an authorized user to your credit card offers them the convenience of using your account, but a common question arises: will this affect their credit score? The short answer is no, not directly. While the authorized user gains access to credit, it doesn’t automatically translate to a positive or negative impact on their personal credit report.

This is because credit bureaus primarily report account activity for the primary account holder(s). The authorized user’s name might appear on the account statement, but their individual credit profile remains largely untouched. They won’t gain credit history simply by being added, nor will their score be negatively impacted if the primary account holder misses payments.

This is a key distinction to understand. Authorized users aren’t building their own credit history through this arrangement in the same way that they would by applying for and managing their own credit card. They are, essentially, benefiting from the established creditworthiness of the primary account holder. The authorized user’s credit report will continue to reflect their own borrowing history, payment behavior, and other financial activities, independent of the authorized user status.

However, there’s a crucial caveat. While the authorized user’s credit score remains unaffected, the primary account holder’s credit behavior directly impacts the account’s standing. If the primary account holder consistently makes on-time payments and keeps the credit utilization low, this positive account activity reflects favorably on their credit report. Conversely, late payments or high utilization will negatively affect the primary account holder’s credit score. This is the only way the authorized user status indirectly affects credit – through the performance of the primary account.

Therefore, adding someone as an authorized user is primarily a matter of convenience and access, not a credit-building strategy. Those looking to establish or improve their credit history should focus on applying for their own credit cards, building a positive payment history, and maintaining responsible credit usage. Becoming an authorized user can be a helpful supplementary measure, particularly for those with limited credit history, but only in conjunction with responsible individual credit management. It’s not a magic bullet for credit improvement.