This post originally appeared March 15, 2018 on CreditCards.com as “Can adding authorized user to charge card help them build credit?“
By Barry Paperno
Dear Speaking of Credit:
I’m adding an authorized user to my American Express Gold to help this person rebuild credit – and for me to earn rewards.
However, this card does not have a preset limit. Does this even help improve this person’s FICO credit score? Or will it hurt the authorized user’s credit because there will not be a debt-to-credit ratio?
There will only be a high balance indication. And this person does not have any other credit line out there.
Good question. And good idea adding an authorized user whose additional card use can help generate enough additional rewards points to make that American Express Premier Rewards Gold card worth the $195 annual fee (after a free first year).
Yet, while helping you accumulate those points, I understand your concern over the card’s impact on the authorized user’s credit score, especially since this authorized user doesn’t have any other open “revolving” credit.
We’ll focus on why this lack of available credit matters and how this American Express Premier Rewards Gold card, and other “charge” cards, do and do not help authorized users’ credit scores.