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helping an adult child get started w/ credit

Valued Contributor

helping an adult child get started w/ credit

We have a college-aged son soon to head out of the country for an exchange semester. He's very responsible and insanely frugal -- easily moreso than I was at his age -- and I'd like him to have a card for emergencies.  Still, because of the very real dangers of theft & fraud, I'm unwilling to make him an authorized user on my account, as one can't place a ceiling on the spend of an authorized user.

 

So ... is the best way forward to be a guarantor and, if so, any things to be wary of?

 

Insights welcome.

2019 Goal: 800+ across the board (my sole 30-day late drops in Q1 2019)
2018 Goals: garden, 750+ across the board, garden, put away 3 months' savings, garden



Experian is the canary in my coal mine.

EQ7756 INQ (4 CC, 2 mort)
EX7528 INQ (4 CC, 2 HELoan, 2 mort)
TU8026 INQ (4 CC, 2 mort)
6/24 < 8.5% AAoA 7y 1m | AoYA 4m | AoOA 19y 6m
Take the myFICO Fitness Challenge [ Last INQ 11-May-2018 ]
Gardening 'til Q1 2019
Message 1 of 15
14 REPLIES
Contributor

Re: helping an adult child get started w/ credit


expatCanuck wrote:

I'm unwilling to make him an authorized user on my account, as one can't place a ceiling on the spend of an authorized user.

 

 


Hey expatCanuck,
Yesterday, I was online looking at my AMEX BCE account. While using the chat feature to IM with a rep, about my statement cut dates, she asked me if I wanted to add an additional card holder.  I declined as I needed to know exactly how that would impact my credit.

 

The rep, pushing for the upsell said that it wouldn't be able to make a negative impact then she did mention that I could even put a $200 limit on that additional users card. I still declined, but found this last claim interesting. 

 

Perhaps it is something you can look into.

 


Merrick Bank Visa $2000 | Citi BestBuy Visa $11,000 | Chase Freedom $2000 | Amex BCE $18,000 | Amex Plat Charge | Amex EDP $5000 | Discover IT $5000 | Alliant SSL
Starting Score: Fico 8: EQ 721 TU 742 EX 736
Current Score: Fico 8: EQ 785 TU 788 EX 786
Goal Score: Fico 8: EQ 750+ TU 760 EX 750+


Take the myFICO Fitness Challenge
Message 2 of 15
Valued Contributor

Re: helping an adult child get started w/ credit

Thanks.  Based on this 18-month-old article, it looks like Amex is the the only issuer offering such control:

https://www.nerdwallet.com/blog/credit-cards/credit-card-spending-limit-for-authorized-users/

 

Still, I'm comfortable being a guarantor for a non-annual-fee card with better acceptability (i.e. - Visa or MC network) without foreign transaction fees.  I've got an 18-year history with BoA -- I'm hoping that I can work something out with their Travel Rewards product.

2019 Goal: 800+ across the board (my sole 30-day late drops in Q1 2019)
2018 Goals: garden, 750+ across the board, garden, put away 3 months' savings, garden



Experian is the canary in my coal mine.

EQ7756 INQ (4 CC, 2 mort)
EX7528 INQ (4 CC, 2 HELoan, 2 mort)
TU8026 INQ (4 CC, 2 mort)
6/24 < 8.5% AAoA 7y 1m | AoYA 4m | AoOA 19y 6m
Take the myFICO Fitness Challenge [ Last INQ 11-May-2018 ]
Gardening 'til Q1 2019
Message 3 of 15
Contributor

Re: helping an adult child get started w/ credit


expatCanuck wrote:

Thanks.  Based on this 18-month-old article, it looks like Amex is the the only issuer offering such control:

https://www.nerdwallet.com/blog/credit-cards/credit-card-spending-limit-for-authorized-users/


Confirmed!...Nice! 

The rep was selling me on: additional card gets more reward points. I will look at this offer more seriously now.

Do you have an AMEX? If so, will you give the kid a shot this way or continue to help find a separate card?


Merrick Bank Visa $2000 | Citi BestBuy Visa $11,000 | Chase Freedom $2000 | Amex BCE $18,000 | Amex Plat Charge | Amex EDP $5000 | Discover IT $5000 | Alliant SSL
Starting Score: Fico 8: EQ 721 TU 742 EX 736
Current Score: Fico 8: EQ 785 TU 788 EX 786
Goal Score: Fico 8: EQ 750+ TU 760 EX 750+


Take the myFICO Fitness Challenge
Message 4 of 15
Valued Contributor

Re: helping an adult child get started w/ credit

Possibly, but the Visa network would be my first choice, given it's wider global acceptance.  I may also be able to work out something with our 'family' bank, which is in the top 10 nationally.

 

[edit] Actually, the more I think about it, the easier the mechanics are -- I CLD my lowest line (an MC which has no foreign transaction fee) to an amount we're comfortable with, and make my son an authorized user. 

 

I've got 6 other lines providing more credit than I can use; when he returns, my scores should all be above 750 -- enough to support a CLI request, should I be so inclined.  Right now, as my sig shows, my EX score can't tolerate another inquiry.

2019 Goal: 800+ across the board (my sole 30-day late drops in Q1 2019)
2018 Goals: garden, 750+ across the board, garden, put away 3 months' savings, garden



Experian is the canary in my coal mine.

EQ7756 INQ (4 CC, 2 mort)
EX7528 INQ (4 CC, 2 HELoan, 2 mort)
TU8026 INQ (4 CC, 2 mort)
6/24 < 8.5% AAoA 7y 1m | AoYA 4m | AoOA 19y 6m
Take the myFICO Fitness Challenge [ Last INQ 11-May-2018 ]
Gardening 'til Q1 2019
Message 5 of 15
Regular Contributor

Re: helping an adult child get started w/ credit

Unless NFCU have changed their policy, that offer is good with them as well.

Message 6 of 15
Valued Contributor

Re: helping an adult child get started w/ credit


tricie17 wrote:

Unless NFCU have changed their policy, that offer is good with them as well.


Thanks.  Unfortunately, not eligible for NFCU. (Could become eligbile for PenFed, tho', via Voices for America.)

2019 Goal: 800+ across the board (my sole 30-day late drops in Q1 2019)
2018 Goals: garden, 750+ across the board, garden, put away 3 months' savings, garden



Experian is the canary in my coal mine.

EQ7756 INQ (4 CC, 2 mort)
EX7528 INQ (4 CC, 2 HELoan, 2 mort)
TU8026 INQ (4 CC, 2 mort)
6/24 < 8.5% AAoA 7y 1m | AoYA 4m | AoOA 19y 6m
Take the myFICO Fitness Challenge [ Last INQ 11-May-2018 ]
Gardening 'til Q1 2019
Message 7 of 15
Valued Contributor

Re: helping an adult child get started w/ credit

Make him an AU but don't give him the card. Let it update to the CRA's then he should be able to apply for his own cards.


TU FICO 8: 750 (5/18) — Ex FICO 8: 751 (6/18)
Message 8 of 15
Valued Contributor

Re: helping an adult child get started w/ credit

Excellent point, assuming that the issuer reports an AU to the CRAs.

 

 

2019 Goal: 800+ across the board (my sole 30-day late drops in Q1 2019)
2018 Goals: garden, 750+ across the board, garden, put away 3 months' savings, garden



Experian is the canary in my coal mine.

EQ7756 INQ (4 CC, 2 mort)
EX7528 INQ (4 CC, 2 HELoan, 2 mort)
TU8026 INQ (4 CC, 2 mort)
6/24 < 8.5% AAoA 7y 1m | AoYA 4m | AoOA 19y 6m
Take the myFICO Fitness Challenge [ Last INQ 11-May-2018 ]
Gardening 'til Q1 2019
Message 9 of 15
Established Contributor

Re: helping an adult child get started w/ credit

Prepaid international travel card.  No exchange fees. Loaded/reloaded at the balance you want.  Cancelable if lost/stolen. reasonable emergency cash fees for atm usage. And it looks like Visa offers them.

 

https://usa.visa.com/pay-with-visa/cards/prepaid-cards/travel-money-card.html

Message 10 of 15