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credit card authorized user

Q&A: After her husband died, a widow’s credit limit plummeted

September 2, 2024 By Liz Weston

Dear Liz: You’ve mentioned how important it is for spouses to each have credit cards on which they are the primary account holder. My husband died last year. We had a credit card with statements that showed the charges we each had made on our separately numbered credit cards. I found the account was in his name only. I had to get a new credit card in my own name, and the credit limit dropped from $75,000 to $7,000. Hope this warns others.

Answer: It bears repeating that most credit cards these days are not joint accounts. If two of you are using a card, one is probably the primary account holder and the other the authorized user.

After a primary account holder dies, credit card companies are often willing to work with surviving spouses who were authorized users to establish new accounts. But as you experienced, the credit limits for these new accounts may be much lower than those of the original.

Filed Under: Credit Cards, Q&A Tagged With: authorized user, couples and money, credit card authorized user, Credit Cards, Estate Planning

Q&A: What to do with a drawer full of unused credit cards?

August 19, 2024 By Liz Weston

Dear Liz: At 75 and 79, my husband and I have no plans to buy a new car or property. We own our home and cars. We have excellent credit ratings. We use one major credit card. I’m consolidating our financial life for our heirs. We have a drawer full of cards we never use. Is there any reason not to just cancel these cards and save our heirs the trouble? Should I care if my 850 credit score tanks?

Answer: At this point, simplifying your finances probably makes more sense than trying to keep your credit scores as high as they can possibly be.

Cards you aren’t using still need to be monitored for fraud, which is a hassle, plus you may be paying unnecessary annual fees. Reducing the number of accounts should make your life easier, but don’t go too far.

As explained in previous columns, each spouse should have at least one card on which they are the primary account holder. A spouse who is an authorized user often loses access to the card when the primary account holder dies and card issuers close the account. Few credit card issuers offer joint accounts these days, so you should determine who is the primary account holder and who is the authorized user on each of your cards before deciding which to close.

You can reduce the damage to your scores by trying to preserve as much of your current credit limits as possible. Ideally, the cards you keep will be the ones with the highest limits. If you’re closing other accounts at your chosen issuer, you can ask that the credit limits for the shuttered cards be transferred to the card you’re keeping.

Filed Under: Credit Cards, Credit Scoring, Q&A Tagged With: authorized user, couples and money, credit card authorized user, Credit Cards, Credit Score, Credit Scores, credit scoring

Monday’s need-to-know money news

March 28, 2022 By Liz Weston

Today’s top story: Why rising car prices make gap insurance worth a look. Also in the news: The fed interest rate hike, and what a credit card authorized user is, how to apply for a credit card, and how to handle a windfall.

Why Rising Car Prices Make Gap Insurance Worth a Look
If your car is totaled or stolen and you owe more than it’s worth, gap insurance can help pay the difference.

Smart Money Podcast: The Fed Interest Rate Hike, and What’s a Credit Card Authorized User?
Higher interest rates may affect your mortgage and credit card payments, as well as everyday finances.

How to Apply for a Credit Card: Questions You’ll Be Asked
Applying for a credit card isn’t hard, but it helps to know in advance what information you’ll need.

‘Where’d the Money Go?’ How to Handle a Windfall
A windfall can either be a lifeline to short-term financial relief or a stepping stone to long-term financial stability.

Filed Under: Liz's Blog Tagged With: applying a credit card, car insurance, credit card authorized user, fed interest rates, Smart Money podcast, windfall

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