In an era of growing independence, is it still wise to opt for a joint credit card? The answer is both yes and no. You must base your decision depending on your relationship with the other person and what you aim to gain out of a joint credit card. While a majority will shake their heads in a vehement ‘no’ to owning a joint credit card, it can actually simplify finances, especially among married couples.
Of course, finding the right joint credit card can be tricky. What you need to do before investing in one is to read reviews first. But when exactly should you open a joint credit card account? Here are some points that may help you make a decision.
Sharing the responsibility
If used correctly, owning a joint credit card can help build trust. This is especially true for couples who want to proceed to the next stage of the relationship, like moving in together. Sharing a credit card helps divide the financial worries and ease the load of sharing bills and other financial responsibilities.
Helps lift bad credit
A joint credit card can also help a partner deal positively with bad credit score. If you wish to improve the credit score of your partner, get a joint credit card with them. This helps you keep them on track whenever they falter.
Getting a competitively low interest
Many times, a partner, who is a maverick credit card user, gets hordes of discounts and deals on credit card. They even get an amazingly low interest on their card due to regular usage and a good credit score. For those who wish to share these benefits with their partner, you can avail a joint account.
All these said, opting for a joint credit card involves some risks. These risks include the following:
Arguing over money
In an argument, one partner always tends to be more judicious than the other. However, money can topple the balance of a relationship. It gets even more complicated when a credit card is involved. So, before you open an account, ensure that you are both comfortable with each other’s financial habits. Before you can establish trust, you need to work out your differences first. According to Ameriprise’s study on Couples and Money, 68% of couples with matching financial habits revealed that their conversations over money were perfect.
Unbalanced credit usage
One person can use up the maximum credit, thus leaving the other with nothing to use. This leads to mismanagement of finances and arguments. To prevent this, set up clear guidelines on the amount of credit each person can use. Communication is the key. Having transparent conversations in money matters always helps.
Owning a joint credit has its benefits and drawbacks. Whether it works for you or not solely depends on what you intend to get out of it. It’s worth a try if you have the right trust levels with the other person.