Two ‘safe’ ways to build credit using cards


Either piggybacking or going solo, responsible cardholder behavior is key

The Credit Guy columnist Todd Ossenfort
Todd Ossenfort has been chief operating officer for Pioneer Credit Counseling since 1998. He writes our weekly “The Credit Guy” column, answering reader questions about credit counseling and debt issues.

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Dear Credit Guy
In regard to building credit, which option is a safer choice, opening a credit card account on your own at a financial institution, or joining someone else’s account, being a cardholder and using their credit? – Evelin


Dear Evelin,

I’m not really sure what you mean by a “safer choice” when it comes to building credit. But I can tell you how each option you mentioned works. Hopefully that will help you decide which way to go.

Building credit as an authorized user

Let’s talk about adding yourself as an authorized user to somebody else’s card first. This option is particularly helpful for those without a credit file, or those with a very slim file.

It is used most frequently by parents who are seeking to help their children establish credit for themselves. The child receives the benefit of a parent’s credit experience and can learn how to manage a credit card without any legal responsibility for the account.

I suppose that could be considered “safer,” since you could not be held liable for anything that goes wrong with the account.

Being an authorized user can work well to build credit, assuming the account is in good standing and remains that way. This means that the amount of credit used is low and the account is paid in full on time, every  time.

These actions will reflect well on both the owner and any authorized users on the account. By the same token, any missteps with the card will reflect badly on every person associated with the account.

For that reason, I’d advise against adding yourself as an authorized user to an account of someone whose credit and card management habits are less than stellar. Adding yourself as an authorized user to a reckless cardholder’s account can backfire and have the opposite effect of building good credit.

2 ways to build credit on your own

Video: What is a secured card?

The second option is to build credit on your own, even if you already have a slim credit file or have been added as an authorized user to someone else’s account.

Having credit on your own, for which you are responsible, is key to building a strong credit profile.

In this case, a starter card or a secured card are good options if you are concerned that you might not qualify for a card on your own.

  • A starter card can either be a student card or a low-limit card geared toward consumers with limited credit history or those rebuilding credit.
  • A secured card works pretty much like a regular credit card, except the cardholder makes a security deposit to open the account. That deposit, often equal to the credit line, assures the card issuer that a borrower won’t rack up a bill and walk away. When managed responsibly, secured cards are great credit builders, as in most cases their payment activity will be reported to the major credit bureaus.

How to apply for a card to build credit

Be sure to research your credit card options carefully. Among the things to consider:

  • Your spending habits
  • The card’s interest rate
  • Credit limit

See “6 things to consider before choosing a credit card,” and “10 things NOT to do when you apply for a credit card” for more tips.

Next, apply only for a card that you feel somewhat certain you can get. Checking your credit report and score and understanding income requirements are two things you should do before applying for a credit card.

You can also use’s CardMatch to find credit cards for which you’ll be most likely to qualify. 

Remember that hard inquiries are part of your credit score computation (using CardMatch, however, won’t affect your score). In the beginning your credit score may even drop a few points, but with responsible card use you can regain those points fairly quickly.

Again, responsible card use means you stay well below your credit limit and pay your bill on time. My recommendation is to only charge the amount that you can afford to pay off in full when the bill comes.

This will help you build your credit and keep you from accumulating credit card debt.

Lastly, regardless of the credit card you choose to apply for, before doing so make sure the card issuer will report your payment activity to the credit bureaus. That way your responsible cardholder behavior will contribute to building your credit profile even further.

Take care of your credit!

See related: Applying for a credit card? Your odds of approval, 9 things to know about secured cards, Student credit cards: The definitive guide, 6 questions to ask when adding an authorized user to your card

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