You and your partner are thinking about merging your finances and using the same credit card account. Should you? There are definitely benefits to having your partner as an additional cardholder on your credit card account, but there are some risks and downsides as well. Here’s a brief look at the good and bad, to help you determine whether or not you want to add an additional cardholder to your credit card, or be listed as an additional user on someone else’s account.
Risks of Additional Cardholders
The primary risk of having an additional cardholder on your credit card account is that there will be two cards. Why is this a potential problem? Two credit cards increases your risk that one of them will be lost or stolen, and you won’t have full control over keeping that secondary credit card secure. In other words, you have to trust someone else with your financial security. If that additional credit card is lost or stolen, you probably won’t be able to access your account with your own card either until new cards are sent by the credit card company (in their effort to prevent any fraudulent charges).
Having an additional cardholder has another possible downside. Some credit cards will charge you additional annual fees for each card added to your account. Not only that, but if it’s a rewards card, you might also have to pay an additional rewards programme fee for each card on your account. For example, the ANZ Balance credit card charges a $10 annual card fee and a $22 rewards programme fee annually for each additional cardholder (in addition to your total $79 annual fee for the primary credit card).
Rewards of Additional Cardholders
Despite the downsides, there are some positive things to consider when it comes to additional cardholders. For example, let’s say you’re using the rewards card mentioned above. The extra annual fee might be worthwhile if two people spending with the card will significantly increase the rewards points you earn, rather than splitting points between your card and someone else’s card with a completely different credit card company. You’ll earn higher levels of rewards points more quickly — ideal if you want to redeem them for something costly like a flight.
While some credit card companies do charge you extra for each cardholder, those fees are easy enough to avoid. Just choose a credit card that offers free additional cards. For example, the Woolworths Everyday Money credit card gives you one additional cardholder for free. Other credit cards will give you even more at no added cost.
In the end, you have to weigh the risks and rewards before deciding if having an additional cardholder is right for you. You might be able to simplify recordkeeping with just one statement but have to be more careful because your credit card use affects someone else’s spending ability, for example. If you do decide to go with an additional credit card on your account, you might want to look into balance transfers at the same time if another credit card company will help you significantly save on annual fees with multiple cards.
Risks and Rewards of Additional Cardholders
You and your partner are thinking about merging your finances and using the same credit card account. Should you? There are definitely benefits to having your partner as an additional cardholder on your credit card account, but there are some risks and downsides as well. Here’s a brief look at the good and bad, to help you determine whether or not you want to add an additional cardholder to your credit card, or be listed as an additional user on someone else’s account.
Risks of Additional Cardholders
The primary risk of having an additional cardholder on your credit card account is that there will be two cards. Why is this a potential problem? Two credit cards increases your risk that one of them will be lost or stolen, and you won’t have full control over keeping that secondary credit card secure. In other words, you have to trust someone else with your financial security. If that additional credit card is lost or stolen, you probably won’t be able to access your account with your own card either until new cards are sent by the credit card company (in their effort to prevent any fraudulent charges).
Having an additional cardholder has another possible downside. Some credit cards will charge you additional annual fees for each card added to your account. Not only that, but if it’s a rewards card, you might also have to pay an additional rewards programme fee for each card on your account. For example, the ANZ Balance credit card charges a $10 annual card fee and a $22 rewards programme fee annually for each additional cardholder (in addition to your total $79 annual fee for the primary credit card).
Rewards of Additional Cardholders
Despite the downsides, there are some positive things to consider when it comes to additional cardholders. For example, let’s say you’re using the rewards card mentioned above. The extra annual fee might be worthwhile if two people spending with the card will significantly increase the rewards points you earn, rather than splitting points between your card and someone else’s card with a completely different credit card company. You’ll earn higher levels of rewards points more quickly — ideal if you want to redeem them for something costly like a flight.
While some credit card companies do charge you extra for each cardholder, those fees are easy enough to avoid. Just choose a credit card that offers free additional cards. For example, the Woolworths Everyday Money credit card gives you one additional cardholder for free. Other credit cards will give you even more at no added cost.
In the end, you have to weigh the risks and rewards before deciding if having an additional cardholder is right for you. You might be able to simplify recordkeeping with just one statement but have to be more careful because your credit card use affects someone else’s spending ability, for example. If you do decide to go with an additional credit card on your account, you might want to look into balance transfers at the same time if another credit card company will help you significantly save on annual fees with multiple cards.
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