Credit cards: Should you share with your new spouse?

Dec 31, 2009

You can if you want to – simply add his or her name as an authorized user on your account, and have him/her do the same for you. Then you’ll each be issued cards on each other’s accounts and both be able to use all of your combined accounts.

But should you?

Since money issues are a prime cause of divorce, the first thing to do is get into agreement about how your credit cards – and the rest of your financial picture – will be handled. Of course, this issue should have been settled long before the wedding, but if it’s still a question, now is the time to face it.

If your spending habits are similar – good – especially if you’re both conservative spenders. But if one of you is a free spender and the other is conservative, you probably shouldn’t blend your cards.

As far as the credit bureaus are concerned, each of you is an individual entity – with an individual credit history. So if you’ve taken good care of your credit and your spouse spends freely – you probably want to keep your own cards separate. And since joint accounts – such as utility bills – may be reported under both your names, you probably want to oversee payment of those accounts.

Because each of you will be treated as an individual for credit reporting, it is a good idea for you to either have separate accounts or a joint account – with both of you being responsible for payment. A joint account will be reported to the credit bureaus under both of your names, and your credit will be improved or harmed by the way you handle that account.

Many widows have found out too late that merely being an authorized user on their husband’s accounts did not give them a credit history. So when they were widowed needed credit, they had none – even if they had been the person responsible for bill-paying during their marriage.

Every person needs a good credit history, and thus should either have a credit card that is solely in their own name, or be a joint holder on an account – not just an authorized user.

So if your spouse is irresponsible with spending and should not have a credit card – share the account, but shred his/her card!

When the time comes for you to purchase a house – probably together – both of your credit scores will be considered. So it pays for both of you to keep your FICO scores as high as possible.

In cases where one spouse has maintained good credit and the other has not, lenders can write the mortgage in just the name of the “good credit spouse” – but in that case can only use the income from that party. This could be a blessing in disguise if using your combined income would cause you to buy a house with payments that put a strain on your budget.

If you don’t have a credit card in your own name, look over the possibilities and make an application. If you have no credit yet, you may need to choose a high interest card, but if you use it sparingly and pay the balance in full each month, you’ll build your credit and soon will be eligible for a lower rate card.

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