Sometimes, removing your name from your parents’ credit card (or vice versa) has its advantages. For starters — it’s kind of nice to handle your own bills without getting the glowering stink eye about your spending sprees on the card’s statement. And while you’re on the card, your credit is generally linked to your parents’ credit, so if your parents are irresponsible, you’ll look irresponsible too, said Eric Lindeen, vice president of marketing for ID Analytics in San Diego, California.
“It can be a great financial head start to be listed on a parent’s card, but [it] can become awkward or damaging if their credit isn’t sterling,” he said.
To get an idea of how your parents’ card use may be affecting your credit, it’s a good idea to check your credit report. That’s because if your name is listed on a shared credit card account, the good and bad habits of all users can show up on your credit report.
“It should be easy to spot problems and decide if you should remove yourself from the card,” Lindeen said. “A horrible card will be less than a year old, maxed out, with multiple late payments.”
You can pull your credit reports for free each year at AnnualCreditReport.com. You can also watch for changes by viewing two of your credit scores for free every 14 days on Credit.com. If you ultimately decide it’s time to go your separate credit ways, the next steps vary, depending on how the account is shared. Here’s a rundown of your options.
1. If You’re an Authorized User on Your Parent’s Card
You can breathe a huge sigh of relief if you’re an authorized user, because you’ll have no responsibility for repayment of the credit card’s debt, according to Rod Griffin, director of public education at credit bureau Experian. If you want to come off the account, call the card company to learn its policy for removing your name. It normally only takes a call to remove authorized users, although the issuer may request a letter, or for the person responsible for the account to contact them directly, which could admittedly get awkward.
“The biggest challenge in a situation like this is having the conversation with the parent (or more often, the child) to explain the action. We can hope they accept graciously,” said Lindeen.
In addition to contacting the card issuer, you should also get in touch with the three major credit reporting agencies to have the account removed from your credit report.
“Experian will remove authorized user accounts from the credit history upon request,” said Griffin. This step is particularly important if your parents’ credit card habits are a little irresponsible.
2. If Your Parent Is an Authorized User on Your Account
Let’s say you were helping your parent rebuild credit by adding them as an authorized user to one of your accounts, but the process has gone awry: You can call to have them removed from the account. However, keep in mind, while this removal can prevent future problems, it won’t eliminate any black marks mom or dad have already added to your credit report.
“An authorized user can definitely damage a primary cardholders’ credit report, as the primary cardholder assumes all responsibility for the [authorized user’s] activity,” said Sukhi Sahni, director of communications and marketing public relations for Capital One.
In other words, as a primary accountholder, you’re considered liable for the debts your parents may have run up — and, if those debts caused you to miss any payments on the card, you’ll have to wait for those to age off of your credit report.
3. If It’s a Joint Account
If you are a joint accountholder on the card in question, you can move to have the account closed. Either party can unilaterally close the account by contacting the card issuer over the phone or in writing. Once closed, the cards of both joint account holders and any authorized cardholders will be deactivated, and any future attempt to make purchases will be declined. But both parties are generally still considered on the hook for any debt remaining on the card. And, yes, those debts and/or missed payments will likely appear on your credit report until they’re paid down or age off, respectively.