Episode Transcript
[00:00:00] What's Randy Miles on the phone with mansa Musa from MoneySmartLife.org and Manta. Let's get back to a very important topic about credit cards. And today we're going to talk about those joint credit card accounts. Yeah. Money Smart Life best practices is not to have a joint credit card account, not with your spouse and certainly not with anyone that you're not legally bound to. And here's why. When you have a joint credit card account, say between a husband and a wife, you just cut your credit potential in half. Got it. If the credit card has a $5,000 limit, that's shared between both of you. Right. If you each had a credit card for $5,000 now, you'd have $10,000 worth of credit limit.
[00:00:58] If you want someone to share your credit card, make them an authorized user, not a joint account holder. Makes a difference. Absolutely. Authorized user. They have all the same privileges as if they were a joint cardholder, except they're not responsible for the paying of the bill. They are responsible if they make charges. Got it. On the account and you have to pay them, but they're not responsible for paying your bill. The other thing is if you and your family go through some sort of economic dislocation and you have a joint account and you miss a payment, you just ding both of your credit. Oh.
[00:01:43] If the same situation arises and you have separate accounts, then you can prioritize one person's credit over another. And if you're in a position where you can't make a payment, then it only hits one person rather than both of you. And so if you miss a payment, if you have a joint account, it exacerbates bad news. It doubles it. You both get hit. So that's a big reason not to have joint accounts. And finally, we say that your credit limit is part of your safety net.
[00:02:18] Now, once again, we're not recommending you go out here and jack your credit card debt up. But what we are saying is if you're going through a hard time and you need to get your hands on some money, your credit card available balance can help you with that. Right? So if you both share one credit card with a $5,000 limit, that's your safety net per se. If you each have a credit card for $5,000 and now your safety net is $10,000. Exactly. So in summary, once again, it's best practices not to have joint accounts between married people. Have your own individual accounts. And if you want to share credit cards, just make the other person unauthorized user on your account. That is amazing and very, very good information. You can find all kinds of great information on Money, Smart Life.org and also on Take Control Tuesday.com Manta thank you so much. Thank you.
