If you’re considering sharing a credit card with a loved one, addressing some of the hot topics beforehand—such as spending limits, who pays the bill, and rewards strategy, to start—can help. to avoid subsequent quarrels.
Here are five conversations to have before you share a credit card with your partner:
1. What is your past financial history?
If you have some credit card debt Or if you’ve had trouble getting it in the past, it’s important to tell your partner before you start sharing the credit card to avoid surprises later.
This conversation is not always easy. According to a recent survey, about one in five people have lied to their spouse about having credit card debt or how much they owe. However, more than two in five people think it is important for spouses to discuss their credit score before moving in together, and the vast majority of those who pool their finances with their spouse — 86% — say all couples should pool at least some of their resources. Finance.
2. Who will pay the bill?
If one partner is the primary cardholder and the other is the authorized user, the primary cardholder is ultimately responsible for paying the bill. By paying it in full and on time each month, you’ll avoid paying interest and late fees. If you open a new credit card together, you can decide who will take on this role.
3. What kind of expenses should be discussed upfront?
If everyday expenses, such as coffee or groceries, probably don’t require a detailed discussion, it’s a good idea to state what level of expense is expected.
For example, maybe someone shouldn’t afford a $500 plane ticket without talking to the other person first. Large purchases may strain the card’s credit limit or make it difficult to pay the bill in full at the end of the month, which can result in interest charges.
4. How will issues be handled?
If your monthly bill is higher than expected, or if you hit a late payment penalty or two, it’s a good idea to have a calling plan.
He suggests holding periodic meetings once a month to review card and spending habits and savings goals.
5. How will you share the rewards?
Credit card rewards can be part of an overall strategy to help fund vacations, and couples can rack up points faster if they share cards. If travel isn’t in your plans, you can also use rewards for cash back or points to use toward purchases or gift cards, among other options.