For couples who enjoy maximizing travel rewards and managing points, the concept of “two-player mode” has become increasingly popular. This strategy involves combining efforts to earn more points and miles, thereby gaining access to more rewards. But one key question remains: Should your partner get their own credit card, or should you add them as an authorized user on your account?
The answer depends on a variety of factors, including your financial goals, spending habits, and long-term plans. Let’s dive into the benefits of each option so you can decide which approach suits you best.
Benefits of Adding Your Partner as an Authorized User
Adding your partner as an authorized user on your credit card can streamline the rewards-earning process and simplify account management. Here are some benefits:
- No Separate Application Needed: Adding an authorized user doesn’t require a credit check, which helps avoid potential hard inquiries on your partner’s credit report.
- Combined Spending for Bonuses: All spending on the account generally counts towards welcome bonuses, so you can reach spending thresholds more quickly.
- Potential for Bonus Points: Many cards offer additional rewards for adding authorized users. For example, Chase and Capital One cards sometimes offer bonus points for this action.
- Reduced Fees: Many credit cards, like the Chase Sapphire Preferred® Card, allow authorized users at no additional cost. This way, you avoid paying two annual fees.
- Exclusive Perks for Authorized Users: Some cards extend benefits to authorized users. The Citi® / AAdvantage® Executive World Elite Mastercard® provides Admirals Club access for up to 10 free authorized users, while The Platinum Card® from American Express offers lounge access and other travel perks for a fee.By adding your partner as an authorized user, you’re simplifying your credit management and potentially helping them build their credit score, all while enjoying shared benefits.
Benefits of Your Partner Getting Their Own Credit Card
Alternatively, having your partner get their own card opens up a world of new possibilities:
- Earn a New Sign-Up Bonus: Separate cards mean separate bonuses. For example, you could earn points or miles through a sign-up bonus on both your accounts, which doubles your rewards.
- Referral Bonuses: Many credit card issuers offer referral bonuses if you recommend your partner for a new card. This way, you both benefit from the new account.
- Diverse Reward Strategies: Owning separate cards allows for different strategies, such as one person earning airline miles while the other focuses on hotel rewards. This makes it easier to plan trips using both types of points.
- Independence in Credit Management: By having separate accounts, you each maintain control over your credit score and report. This independence can be crucial if either of you plans to apply for a major loan, as fewer accounts on your credit report can be beneficial.
- Retention of Card Benefits: If you’re solely an authorized user and you separate or the primary cardholder passes away, you risk losing card benefits. Having your own card ensures continued access to your account perks.
Choosing individual cards allows you and your partner to diversify your rewards and enjoy separate bonuses, which can be ideal for couples with unique travel and spending goals.
Questions to Ask Before Making the Decision
To determine whether you should add your partner as an authorized user or encourage them to get their own card, consider these questions:
- Can You Meet the Spending Requirement Alone? If your card has a high spending requirement for a welcome bonus, adding an authorized user can help you reach it. But if it’s easily attainable, separate cards may yield better rewards.
- Are You Prepared for Additional Fees? Separate cards mean two potential annual fees. Ensure this aligns with your budget before proceeding.
- Will Your Partner Benefit from the Card’s Perks? Determine if your partner will make use of the perks offered as an authorized user. If not, having their own card might be more beneficial.
- What’s Your Long-Term Credit Strategy? Consider how being an authorized user could affect your partner’s credit profile and whether having a separate card is better for your financial future.
Additional Considerations
For American Express cardholders, the date on which an authorized user is added is reported as the opening date, which could potentially impact your partner’s average age of accounts on their credit report. This might affect their eligibility under certain banks’ restrictions, like Chase’s 5/24 rule.
Choosing the Right Path for Your Financial Goals
Deciding whether your partner should be an authorized user or have their own credit card ultimately depends on your shared goals and priorities. Weigh the advantages of shared spending and access to perks against the benefits of independent credit management and additional rewards. Each couple’s needs are unique, so evaluate your options and choose the one that best supports your financial journey together.
