Are joint credit cards a good idea?
Key takeaways
- Joint credit cards let two individuals share the same account at the same time, yet there are few credit cards and issuers that allow this option.
- A shared credit card lets two individuals charge purchases and earn rewards alongside one another with the shared responsibility to repay amounts borrowed.
- A joint credit card is different from adding an authorized user to an existing credit card account in a few ways, including that the authorized user is not legally responsible for repayment.
Joint credit cards let two people share the same account at the same time, although few credit cards or card issuers allow this option. Whether having a joint credit card is a good idea is a decision you and the other person on the account need to make together.
There are a range of notable advantages and disadvantages that come with joint credit card accounts, although many of them will vary based on the individuals in question, their lifestyle and their financial attitudes. Joint credit cards are just one of the many ways people share their financial lives. For example, it’s common to take out a mortgage that lasts up to 30 years with a partner or spouse. Many people also open a joint bank account (whether a checking account, savings account or both) with another person, in which case all the money inside the account is shared.
Even though commingling financial responsibilities is common in close relationships, you may still be wondering if joint credit cards are a good idea. While there is no “right” answer to this question, it’s easy to see scenarios where having a joint credit card makes sense.
Two ways you can share a credit card
Before we dive into the intricacies of joint credit cards and how they work, it’s important to explain the differences between shared credit cards and authorized user accounts. For the most part, there are two main strategies individuals can use to share a credit card:
- Authorized user cards: You add an authorized user to an existing credit card (or become an authorized user on someone else’s account)
- Joint credit cards: You open a joint account with a co-borrower
Authorized user
When you add an authorized user to your account, you’re adding another person to a card account that is already open and in operation. After doing so, authorized users will get their own credit card with their name on it, but their purchases and other transactions will post to the primary card holder’s account.
Also note that authorized users don’t have to go through a credit check to be added as an authorized user. The primary cardholder is taking all of the responsibility, so a hard inquiry on the authorized user’s credit report isn’t required.
Joint cardholder
With a joint credit card account, on the other hand, you’ll apply with a credit card together with another person, similar to how you would apply for a mortgage or a car loan as joint applicants. This means you’ll both have a hard inquiry on your credit report when you apply, and that both of your financial situations will be considered for approval.
Be aware that, with joint credit cards, both individuals on the account are legally responsible for repaying the amounts borrowed. It’s also harder to remove your name from a joint account compared to removing yourself as an authorized user, as you’ll need to have the balance paid off in order to close the account.
How joint credit cards impact your credit score
Both individuals sharing a joint credit account will have their credit scores impacted by the usage of the card. The results of this arrangement can be good or bad, depending on how the card is used and how carefully the cardholders manage their credit.
For example, joint credit card account holders who use their cards for purchases, keep their credit utilization in a reasonable range (preferably below 30 percent of available credit limits) and always pay their credit card bill on time will build credit together. Meanwhile, cardholders who rack up high levels of debt or pay their bill after its due date can easily see damage to both of their scores that could take years to fix.
The most important difference with joint credit cards is the fact that one cardholder’s financial decisions can dramatically impact the other person’s credit. If one cardholder is responsible for paying the credit card bill and they forget, for example, both individuals on the account will face the consequences of that late payment. The same applies if one partner on the account makes excess charges and racks up a significant bill. With a joint account, both parties on the credit card are equally responsible for paying off these balances — even if both parties weren’t equally responsible for creating them.
Pros and cons of joint credit cards
While there are some risks that come with joint credit cards, these risks can be easily managed by joint owners who are on the same page when it comes to finances. There are also some advantages that come with joint credit card accounts.
Pros
- Build credit together: Joint credit cards let two people build credit together. One person with better credit could even help the other qualify for a card with better rewards or terms.
- Fewer bills to manage: Having one credit card to manage each month means having just one credit card bill to pay, lessening the complexity for couples with shared finances.
- Easier to track spending: Couples who want to stay on the same page financially can use a joint credit card to increase their transparency and teamwork.
Cons
- Potential for conflict: Sharing a credit card could be problematic if one person overspends, a couple breaks up or another disagreement comes into play.
- Lower rewards potential: While two people using a joint credit card can earn rewards for their spending together, having just one card means less potential to earn lucrative sign-up bonuses.
- Shared legal responsibility: Shared card accounts mean both parties are legally responsible for paying down balances, which can be a problem if one person made a disproportionate amount in charges.
Authorized user vs. joint cardholder: Which is better?
It’s hard to say whether the use of joint accounts or authorized users is better for anyone in particular. But there are some distinct differences to be aware of. For example, there are differences in who is ultimately responsible for repayment with either option, and joint credit cards have the potential to have a greater impact to your credit score than an authorized user account.
Other nuances come into play when you choose an authorized user account as well. The chart below shows the main differences to be aware of when you’re considering either option.
| Authorized user accounts | Joint credit cards | |
|---|---|---|
| Responsibility for repayment | Primary cardholder is responsible | Account holders are equally responsible |
| Reporting to credit bureaus | Not all card issuers report authorized user accounts to credit bureaus | Activity reported to both users’ credit reports |
| Spending limits | Spending limits can be set on authorized user accounts | Both users have access to the entire line of credit |
With these differences in mind, there are some things that work the same with joint accounts and authorized user accounts:
- Any rewards you earn will all pool in the same place
- Having more people on a single account can help you rack up rewards faster
- Both types of accounts can help you both improve your credit scores, although whether your card issuer reports authorized user activity will make a difference
Which banks offer joint accounts?
If you specifically want a joint credit card account, you’ll need to find a card issuer that offers this option. Unfortunately, joint credit cards aren’t always easy to find.
The three main banks that offer the joint account option are Goldman Sachs, U.S. Bank and PNC Bank.
Best credit cards for joint cardholders
Apple Card
- Earn 3 percent back on everything you buy from Apple and from select merchants when you pay with Apple Pay and your Apple Card; 2 percent back each time you pay using Apple Pay and Apple Card; and 1 percent back on all other purchases
- No annual fee and no hidden fees
The Apple Card* is unique because it allows joint credit cards right off the bat. You can even set up an Apple Family account, which lets primary cardholders earn rewards and monitor spending across authorized user accounts set up for other family members.
Rewards can be redeemed for purchases through Apple Pay, transferred to a bank account or sent to friends through Messages. You do need an Apple device to have this joint credit card.
U.S. Bank Cash+® Visa Signature® Card
- Earn 5 percent cash back per quarter on two categories of your choosing on up to $2,000 in purchases; 2 percent cash back for one category of your choosing (gas stations, EV charging stations, grocery stores or restaurants); and 1 percent cash back for all other qualifying purchases
- Earn $200 bonus cash back with $1,000 in eligible purchases in the first 120 days of account opening
- No annual fee
Having the ability to rotate categories each quarter with the U.S. Bank Cash+® Visa Signature® Card* gives you and your joint cardholder the ability to maximize your cash back rewards based on your spending habits. You also get to choose one permanent cash back category.
To add a joint cardholder, simply call the number on the back of your credit card or 1-800-285-8585. U.S. Bank allows you to add a joint owner for all cards except College Cards.
PNC Cash Rewards Visa Credit Card
- Earn 4 percent cash back on gas station purchases; 3 percent on dining; 2 percent at grocery stores (up to $8,000 per year in combined purchases in these categories annually); and 1 percent on all other purchases
- Earn $200 bonus cash back after $1,000 in purchases during the first 3 billing cycles after account opening
- No annual fee
The PNC Cash Rewards Visa Credit Card* will have you and your co-applicant covered in a variety of categories for your household. You can use your cash back credit towards something you both want or distribute it evenly for each person to make their own purchases.
How to choose the best joint credit card
Choosing the best joint credit card will come down to what meets the needs of you and your joint applicant. It’s important to have clear communication going into this process, especially since you will both be responsible for making payments on the card. Here are a few tips to help you along the way.
- Check both your credit reports. Many joint credit card accounts are looking for credit scores in the good to excellent range (typically between 670 and 850). If you or your partner have a lower credit score, you may want to take some time to improve your scores before you apply.
- Discuss your spending needs. Talk with your partner about how you think you will use your joint credit card. If you’re interested in very different rewards categories, you may be better off applying for individual cards or for a card with rotating rewards categories.
- Have a plan for making payments. Make sure you and your partner have a plan for how you will manage purchases on the card and their repayment. Will you each pay off the purchases you make or will you handle the bill with a 50/50 split? Or will you only use the card for household purchases that you make together?
- Decide how you will handle rewards. You may decide that you want to pool rewards on the card to use towards things you will do or use together or distribute points individually based on what each of you has earned.
- Be open to the ‘authorized user’ route. If one of you doesn’t qualify for the card, choosing to add the second person as an authorized user could help you accomplish the same goal of being on one credit card together as an authorized user won’t have to undergo a credit check.
- Have an exit plan. There are numerous reasons a joint credit card account may need to be closed, the card may not work out or perhaps the relationship won’t. Be sure you understand the credit card terms and conditions for canceling a joint account, including whether one joint owner can maintain the account.
Alternatives to joint credit cards
If you’re not entirely sure a joint credit card is for you, there are some alternative options to consider instead. For example, you can opt to add one person to an existing credit card as an authorized user. This would let them make purchases and potentially build credit, but only the primary cardholder would be legally responsible for repayment.
Both parties could also sign up for their own separate credit card accounts. This means having more than one credit card bill to pay each month, but it also lets individuals manage their own spending and keep their rewards entirely separate. Having both people get their own credit cards can also help a couple earn two credit card sign-up bonuses, which they may be able to merge together depending on the card issuer. For example, Chase lets its credit card customers pool rewards with one person who lives at the same address.
The bottom line
Getting a joint credit card may sound like a good idea, but there’s a reason these accounts are falling out of fashion. Having your own card means you’ll never have to stress over another person’s purchases and you’ll be able to earn your own credit card sign-up bonuses and ongoing rewards on your spending.
You may be better off adding an authorized user to your account if you want to help someone else build credit or if you want to earn rewards on all of their purchases. Another good reason is if you want your child or dependent to have access to your credit limit for emergencies.
The information about the Apple Card, U.S. Bank Cash+® Visa Signature® Card and PNC Cash Rewards Visa Credit Card has been collected independently by Bankrate.com. The card details have not been reviewed or approved by the card issuer.
