Adding Authorized Users

[Anonymous]

My little brother has no credit report and my parents are one year off of a bankruptcy.  Would adding them as an AU on a Citi affect me at all?  Also how about on an Amex, where my parents had put them on a bankruptcy?  Would it help them a lot? I think it would be good for all of us because of reward points and I can monitor it since we still all live in the same home and will for about a year or possibly longer.

[jsucool76]

Adding someone as an AU doesn't affect you, but as the primary account holder, you're responsible to pay for any purchases they make with their AU cards. 

If your parents burned amex in their BK amex might deny adding them as AUs, not sure if they do that, though it is definitely a possibility. 

[webhopper]

If it were me I would keep them away from my cards depending on the reasons for the BK. What were the circumstances that caused them to be bankrupt?

[Anonymous]

Business debt came into personal debt after the 2008ish little by little and then the business collapsed.  The business was doing very well for over 20 years until then.

[webhopper]

So if the family business collapsed; what income do they have that would be useful for paying you back for charges on your citi card? I don't like mixing family with finances because someone always gets hurt.

[Anonymous]

Since they only do contract type work right now or collect unemployment checks, I'll add them as AUs, but completely sockdrawer it?

[webhopper]

That's what I would do... it doesn't hurt to help them but you don't want to be in the business of trying to manage what they are spending as an AU. It could be very uncomfortable if they charged something and were unable to pay and that you cant afford.

The situation sucks but they will ultimately be better off using a cash based system to relearn how to only spend what you can afford. They have a learning curve that they need to go through to get back on track with dignity.

The business must have been highly leveraged for the debt to start creeping in on the personal side. I have my own business; its very small but definately you have to have enough in savings to buffer out the bad months. When you leverage everything like that then you are basically just layering risk like a house made of cards.

[Anonymous]

Hate to hijack this but.. If you get a card for a AU will it help their credit score or does just reflect on mine?

I was also wondering if I can set a spending limit on a freedom or more card.

[webhopper]

It will help their credit score. Amex is the only one I know of where you can set spending limits for the AU.

[Anonymous]

Thanks for the info.