ULPT: Your kids turn 18 with 17 years of credit history.

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Honest_Camera496@reddit

I’m so glad I don’t live in America where you have to worry about this shit

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PIF_Daddy@reddit (OP)

I am glad I live in America. Couldnt imagine living anywhere else.

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PIF_Daddy@reddit (OP)

Have plenty of imagination. Generally we have available everything we could want or need here in the U.S.....except affordable healthcare.

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It works, turned 18 with a phenomenal credit score. Promptly fucked it up by taking out over 12k in credit cards, maxing them out, and stopped paying them cause I couldn’t afford the minimums on my part time minimum wage job. Just dealt with the shit credit for 7 years and it eventually went away. Likely never got sued cause there was nothing for them to win. Still don’t really feel bad about it. To be fair though, what dumbass thinks it’s smart to give an 18 year old with 6 months of work history that kind of money.

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Empty-Discipline8927@reddit

Its fraud.

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Stevesegallbladder@reddit

My dad did this for me when I was a tween. I'm in my 30's now and my credit score for the majority of my adulthood has been in the high 700s to mid 800s. What's wild is lenders 1000% treat you differently too.

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MoonK1P@reddit

My parents did this for me! I’ve got a 738 FICO score and just got my “first” credit card.

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This is incorrect. It will drop temporarily but it will go back up. It’s definitely not worth slowing down payments or paying more in interest. Just because the account closes doesn’t mean there’s no longer an impact on your score.

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KellyAnn3106@reddit

My parents did something like that for me when I was 19. They bought a car for me in cash, then took out a personal loan to pay themselves back. I was put on the loan and made the payments to the bank.

This works. Age of credit line can be extremely impactful on a credit score. Joint family accounts which are attached to all the family members will be included in individual credit histories.

Not an unethical tip at all - but as others have already noted it's what you do with the credit line that matters. Running up a balance and missing payments in your kids name will be disastrous. But using a card for recurring oaymenta or big purchases which you pay off can provide a boost.

Ionalien@reddit

You do not have to go into debt to get a good credit score.

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XxRocky88xX@reddit

You buy 30 dollars worth of groceries on credit, you are now 30 dollars in debt. Yes, it’s easy to pay off, but you still go in debt.

To boost your credit you NEED to use credit, using credit inherently means you go in debt. If you’re conscientious about your credit, this isn’t an issue, but the way the system is set up it actively punishes you for not using credit.

This is the main reason I tell everyone I know to get a credit card as soon as they can and to use it at least once a month and pay off the balance.

If you get a credit card and don’t do anything with it your credit will remain the same.

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pattywhaxk@reddit

Do you also consider your bills that you haven’t paid yet this month as debt?

For most practical purposes, people use the phrase “Going into debt” to refer to carrying a balance and paying interest. Something like a mortgage or car note.

I’ve never once heard someone say “I’m going into debt” to refer to something that they are planning to pay off immediately.

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makaio84@reddit

"Planning to pay off" = debt.

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pattywhaxk@reddit

I agree that it’s debt. But nobody says “I’m going into debt” to refer to something that they are planning on paying off at the end of the month.

To me “going into debt” would refer to a negative net worth.

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makaio84@reddit

I think I see what you're saying, but I don't think I agree in any way past using it as a pretty broad generalization.

Like, my debtors don't care if big picture I'm net positive. They just care that I have a debt to them.

IndyAndyJones777@reddit

No, they see you as a credit risk because you don't have a history demonstrating a responsible use of credit.

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twistedbrewmejunk@reddit

Yes so as my comment and the ones above stated to get a good credit score you need to have open in good standing frequently used credit it's not about being in debt it's about actively using it which they make money off of on the transaction fees. They created the scoring system and they make money off it..

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twistedbrewmejunk@reddit

No but you do need to have open active lines of credit to have a good score.

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TinfoilChapsFan@reddit

A credit rating is an indication to lenders of how likely you are to repay a loan. What are they meant to base this on if you have no history of having loans?

It's not an 'unethical business practice' to not want to give out money you might never see back. You don't have a right to a loan from a bank any more than anyone else has a right to a loan from you, and I guarantee you can think of people in your life who if they asked you to lend them $1000 you wouldn't even consider it for a second because you have your own mental 'credit score' of every single person this idiot has taken money from and never paid back.

Banks are huge and have infinity money though, so I'm sure passing laws to make them give loans to people who their credit rating systems says they should not lend to couldn't lead to unintended outcomes that can have dramatic effects on the entire economy.

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1ultraultra1@reddit

It seems a bit unethical to charge interest rates in the teens and twenty-plus percent range. Credit cards are also marketed in dodgy ways, to younger, naive people, who maybe in a rut financially. Lenders and financial institutions always have fine print that seems to screw consumers... they will just create dollars to their advantage, and it is always the consumers who suffer the losses, with high interest, repossession/foreclosures, or even bailing out the financial institutions when they fail to be responsible. Nobody bails us out, and we bail them out every time!

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TinfoilChapsFan@reddit

It seems a bit unethical to charge interest rates in the teens and twenty-plus percent range.

Why? It's an unsecured personal loan, that's an appropriate amount of interest for the risk taken by the lender.

Credit cards are also marketed in dodgy ways, to younger, naive people, who maybe in a rut financially.

Sure that can be unethical, but I really don't think the majority of people with significant credit card debt didn't know what a credit card was before they got one. If they didn't understand the way interest works in 2024 then that's entirely on them because it takes all of 5 minutes to get your head around it from a Google search.

Lenders and financial institutions always have fine print that seems to screw consumers... they will just create dollars to their advantage, and it is always the consumers who suffer the losses, with high interest, repossession/foreclosures, or even bailing out the financial institutions when they fail to be responsible.

I really don't know what you're talking about here. What fine print do credit cards have to screw you? You use them to buy things you don't have the money for, and then pay interest on the debt. That is what gets people in trouble, and it's the opposite of fine print it's literally the first thing you find out about a card.

Nobody bails us out, and we bail them out every time!

That's OK, contract/post-paid cellular plans are a ripoff. Prepaid is where it's are if you know what you need and how to look for it.

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Jacktheforkie@reddit

Data is more expensive in prepaid and calls texts are always unlimited

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toolsavvy@reddit

r/nocontract is your friend. Once you understand prepaid and how to shop for it, you will save money. If you need priority data your options will be limited, ngl, but prepaid will save you money if you shop for it properly. Also, if you are a data hog because you have too much free time or you just consume ungodly amounts of data, then yeah you probably should stick with postpaid plans.

If you know how much data you need per month, whether you need priority data, and which network works best for you, folks at the sub I linked to can help you choose a prepaid plan to suit your needs.

In the USA the highest credit score is 850. Some countries go up to 900.

My parents filed for bankruptcy twice before I was 18. I was not taught about credit, how to use it or anything. I did get my first brand new car at 19. Had it all of 18 days and got slammed on the interstate and totaled. Gap coverage saved men kinda started adult life with a 700ish score and weak file. Hit 730. Over extended myself early. Been an uphill battle ever since. Got a good job, rebuilt credit. Lost good job. Back in the 6’s. Finally 40’with a high 6 and low debt and a decent job.

TLDR: Teach your kids fiscal responsibility and literacy people.

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crzyjkr99@reddit

Mine did the opposite so by the time I was 18 I had a 330

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mistakes_where_mad@reddit

Same. Only reason I have a credit score. Never really been in debt my whole life which is great cause I'm poor but still have a really good credit score.

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Hi-Point_of_my_life@reddit

I’m not sure if it’s different or how my dad did it but he added me on his gas card and my credit history was 40 years old when I wasn’t even 20

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Wheream_I@reddit

I opened a credit card my senior year of HS and then promptly never used the damn thing all throughout college, living off my debit card.

Razgriz1992@reddit

Yeah I had an emergency card that proudly stated I had been a member since 2 years prior to my birth. Really helped my home buying later on, as it added a well over a decade to my average account history

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clueless_sconnie@reddit

So adding them as authorized users on your cards does it? They don't need separate cards/accounts not attached to you?

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pinkshirtbadman@reddit

it depends on the lender, some report authorized users to credit agencies, some don't.

many lenders have a minimum age for an authorized user so you may not be able to do this until they're teenagers.

Yes and potentially no, as an authorized user on a card the credit usage and history of that card will be reflected on their credit report and score.

Removing them from the card also removes that card's history from their account, as opposed to a card that was originally in their name.

techie825@reddit

I love edgy strategies lmao, just not ones that are straight up gonna deny me a claim or have me convicted and put away. Insurance companies are truly the unethical ones here, anyways.

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SpeakItLoud@reddit

To be clear credit scores are only a thing in the US.

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LovemesenselesS@reddit

Not really. For the average person this would be incredibly expensive.

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digitaladapt@reddit

Minimum age would be 13 in the USA.

One example, American Express: https://www.americanexpress.com/us/explore/additional-card-member-guide.html

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Is it not a red flag at the credit agency?

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Ribeye_steak_1987@reddit

I did this. For various reasons, I made each of my daughters an authorized user of my cc. I pay my card off every month. So, when my 21 year old applied for a home loan, her credit score was over 800.

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MrStickyMuffins@reddit

So then one could hypothetically pass down a card from generation to generation and have a golden credit score? Then one person gets it and fucks the whole thing up? That sounds fun

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fdar@reddit

It doesn't actually change the credit score compared to adding them later.

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Ready2Reach@reddit

This is the way, OP is making it way too complicated. Adding a child, parent, or a stranger to a card that allows it, gives them the same exact credit line information their credit report as the one that actually owns the credit card. American Express is one that does this. My mother had horrible credit but had one Target store card that was 15 years old and was 100% paid as agreed; adding me to that account boosted my credit to the moon (average age of accounts is a major factor in score).

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ImperfectTapestry@reddit

Yeah, this isn't unethical, it's a real gift. My mom did this with me 30 years ago.

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pwlife@reddit

I have added my kids too. I kept the card and have a limit put on it and give it to them to use when they go on field trips to amusement parks or similar.

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MonkeyWithIt@reddit

Make sure they are reporting his credit. I did this with Chase and they won't but Capital One did.

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-forbiddenkitty-@reddit

My mom just added me as an authorized signer to her card at 16. At 18, I got her 800 credit score and my own card with a 25k limit.

Latter_Inspector_711@reddit

My parents did something similar for me, had an 805 when they pulled my credit for a mortgage

Wish they started a Roth IRA for me at a young age but they didn’t. If I have a kid(s), then I’ll do both of those for them

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Thank you, that makes sense!

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njb2017@reddit

I didn't know that. So once they have a part time high school job, parents can contribute towards it? What if there's a lapse of employment when they go to college? Parents have to stop contributing?

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waterbird_@reddit

Parents cannot contribute, they need to put in their own earned income. But it’s a custodial IRA until they turn 18, then you can transfer to them.

If they have a lapse in employment they just wouldn’t contribute anything that year. There’s no requirement in how much you can contribute.

We are opening our son’s through Charles Schwab and there’s $0 fees and no minimum. He’s only making a little bit of money this year but he’s just been sticking it in his savings account so it makes more sense to put it all in the Roth IRA since he has other spending money.

If you wanted to get around these rules a little and make this more unethical, I suppose you could have your kid put in their entire income (up to $7k this year) and you pay them their salary back from your own bank account so they’d still have the money to use now. I don’t even think that’s illegal. I mean that’s basically what we are doing with our kid, he spends his allowance money he gets from us and has been saving his earned income - so now he will just put that earned income into the Roth IRA instead.

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Ok_Independent9119@reddit

Any income below like 14k or something doesn't need to be filled for taxes and the IRA max is 7k so as long as they are earning less than the 14k limit there's no issue. My kid earns money in his allowance, it just so happens that he earns 7k a year in allowance and we put all that money into his IRA. It's his money, he earned it from me, and he's below the limit so he doesn't pay taxes on it.

There's a point where dividends and other returns will potentially put him into a bracket where he needs to file but that's down the line

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generally-unskilled@reddit

If your child actually had $7k in earned income from household work, they need to be filing their taxes and you probably need to be paying payroll taxes as their employer. That kicks in after $2800/year.

They may not owe any federal income tax, but you need to make sure you are following everything else or you could create a huge headache if you or them are ever audited.

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Ok_Independent9119@reddit

Correct. Instead he's out mowing lawns and shoveling driveways and that's how he got the money.

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generally-unskilled@reddit

You just need to be clear that this is earned income. An allowance is typically not considered such.

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waterbird_@reddit

Oh interesting, great point! Thank you.

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gojira_glix42@reddit

Schwab is fantastic for Roth IRA. They have incredible support 24/7 and can talk to a broker anytime as long as you have an account. I suggest doing that when you first open it because their site can be overwhelming as there's not a "basic consumer just funding retirement" vs "I am a professional trader and I need all the tools on front page"

My mom’s a financial advisor managing 100m+ in assets for clients and didn’t teach me shit.

PointCPA@reddit

The vast majority of people who do this are smart enough to not fuck up their kids score.

I do financial advising and everytime I see it the parents are always sharp and getting their kid setup with this (among other things like 529 plans).

In my professional experience I have never seen a parent take advantage of it, but I’m sure it happens and my clientele just aren’t the type.

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thezuse@reddit

I mean I don't come from generational wealth but our family managed to hold onto its middle class prosperity the farming grandparents achieved after WWII. Our one widowed grandmother saved everything she didn't spend from her pension each month and sent her two kids two equal checks every so often. The Depression Era grandmother was stingy with toys and dresses but gave each grandkid $5k for college. Our own parents invested in tuition prepayment and had the accidental foresight to live in a state with a lottery funded full-ride college scholarship.

We think we can only manage to set up one kid well, but we're going to load up their savings and investment accounts and build their credit as much as we can and try to make smart financial choices and retirement planning to give our kid the best chance at breaking into the adult world whatever that may look like in 15-20 years. Thank goodness they are also dual citizen that may help with future education or health care issues. That's so sad to me to not at least try to set your kids up as well as you can instead of extracting everything you can from them for your own benefit!

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theepi_pillodu@reddit

Hi, please help me understand that. I heard kids with 529 education plan with enough money to cover the tution fee would not get scholarship even though they are academically eligible?

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PointCPA@reddit

Depends whether it is merit or need based.

Most people putting money in a 529 have extra fuck you income and we’re likely never going to get an aid based scholarship for the kids to begin with.

I believe there is some way around this now (ish) with the Secure 2.0 act which allows you to move 529 funds to a Roth IRA, but I am not read up on it specifically.

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I thought the goal was to have a shit score to get those predatory loans where they offer you ridiculously low interest because they know you'll miss a payment and then start with the super high interest. Just get one of those and don't miss a payment.

Or the real ULPT, get multiple loans so fast one bank doesn't see the other and go somewhere cheap they can't get you (Thailand for Yanks or Bosnia for Europeans) and live like a king until the loan expires.

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Affectionate-Fan-525@reddit

Wished my mom and dad did this instead of ruining my credit, my parents opened up an account with an electricity company twice and never paid the balance once it got to high and left them instead of paying. Had a terrible credit score before I even passed high school. Boy was I in a surprise.

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SecretRecipe@reddit

this works. even better ULPT:

You can’t do it now because you can’t open a card on a person under 18. Pre-internet and laws. Yep.

My mom opened an am ex in my name when I was 14. She worked at a bank and was…weird…with money and my dad and had tons of secret accounts. Luckily, she was chaotic good and didn’t fuck up my credit. Paid that bad boy off every month.

I turned 18 and had 15 years of credit history!! It helped me out a ton and continues to help me out.

I am not a credit card person. I’m not responsible enough to have them, so I don’t. My parents kept me on their credit card. They’re credit card people. They put every single expense on it and then pay it off entirely at the end of every month. I know that is true because I can see it on my credit report.

If you’re not a credit card person, do not do this. You will fuck up your kid’s future if you attempt this and aren’t a credit card person.

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yung_millennial@reddit

This is exactly how the rich stay rich. Now put your house in a trust and make yourself the executor of the trust and leave the role of executor in your will. Matter of fact do that to all your stuff.

Now your child will inherit everything without paying a dime.

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PIF_Daddy@reddit (OP)

Or transmogrify your trust into a family non-profit corporation. Have the 10 acres family compound put into the family non-profit. All family can live off the land and pay the mortgage. When you die and land passes to your kids/wife/family

NONE OF THE IDIOTS CAN TRY TO SELL IT OFF F#@$ING OVER THE FAMILY!!!

Generational Wealth regardless of descendants missing chromasomes or I.Q. points.

Bonus pts. If you have a trust that has passive income paying the property taxea every year.

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Because most shit are bought with debt in America. Higher score equals lower interest rate. 1% is hundreds per month when buying a house

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juwruul@reddit

The downside to this is when you have an 18 year old who has access to tens of thousands of dollars in high interest loans but little experience with budgeting and is more interested in impulse buying things to show off to his/her friends than being financially responsible.

I'll agree that having an immaculate, 17 year old credit history as an 18 year old can be very beneficial. I'll add that it can also be very dangerous.

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PIF_Daddy@reddit (OP)

That is why you train them about $ far before hand.

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mg1431@reddit

This is just a lifeprotip. Ulpt is friend's junky mom getting a personal loan under his name and SS when he turned 18 and never repaying the 2k and him starting adulthood with fucked credit.

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PIF_Daddy@reddit (OP)

We just unethical here, not douchey .

It works out for the kid but I can definitely see it being unethical since the score reflects someone else’s credit habits. Imagine a parent taking college courses under their kids name to help boost their GPA when they actually start college.

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USnext@reddit

How is the unethical? And don't people do this normally these days?

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Salty-Plankton-5079@reddit

It's not unethical and you don't have to do that. You can add your kids as an authorized user and many companies will report the entire card's history to the kid's file.

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ravens-n-roses@reddit

My parents did this for me. Too bad i spent my early teens and twenties not believing credit or debt was real.

My score isn't terrible but I'm not sure if there's a bank i haven't had a credit card go into default with.

Yes. It’s not unethical either?

My Amex history report goes back actually to before I was born as my dad made me an authorized user on one of his cards so it dates back to when he opened that account.

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bat_scratcher@reddit

My wife's parents did this. She graduated high school with a 750 credit score.

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Ok-Razzmatazz-1547@reddit

My mom did this for me with an old navy credit card. It worked 😊

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DoNotResuscitateB52@reddit

My parents unintentionally did this to me, allegedly. Around 18-19 went to apply for a credit card for myself to start working on building credit, didn’t have any other debt/payments at the time. Bank tells me my credit score is 750 and there’s a credit card open in my name through a different bank. Weird. Worried I’d had identity theft, but also didn’t make sense: what kind of criminal steals someone’s identity and pays off their bills in a timely manner? 🤔

Parents didn’t know what to make of it. Finally after some digging found my name was on their Home Depot credit card. And my parents were known for paying off credit in full/on time. And found that they either forgot or unintentionally added me as a….co-signer? Idk but it definitely made it easier to start with good credit.

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Apprehensive-Run-832@reddit

My dad did this for my little brother. Added him as an authorized user as soon as he could.

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OpALbatross@reddit

My mom accidentally and then intentionally did this with my siblings and our spouses.

She got me an emergency credit card when I started hight school. She put my sister as an authorized user as well.

This isn't an unethical pro tip.

It turns outb people who have parents that plan your credit score out 17 years ahead of time are more likely to pay off loans.

Working as intended.

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ReflectionEterna@reddit

My dad hasn't admitted to it, but I am certain he did this for me. Somehow I graduated high school with pristine credit. Again, he has never said anything about it, but that's exactly the sort of thing he would do and then never mention.

YES.

Thing is, you don't need to be rich to do it. I can't fathom ppl who don't set their kids up for success.

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ngaaih@reddit

My 6 and 2 year olds both have credit cards that get used daily and have 100% on time payoffs.

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Middle--Earth@reddit

Is this legal?

In my country it's illegal to extend credit to minors (under 18s) and so the agreement would be null and voided.

This is because under 18s here cannot sign up to a legally binding contract as they are still classed as a child, and a child cannot have credit extended to them.

The mum would have to falsify the child's birthdate to obtain the credit line, which would be fraud.

Is offering credit to children accepted in other countries?

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Puzzlehead-Dish@reddit

Doesn’t work, the credit industry isn’t stupid. And if you believe that automated AI analysis in 18 years will not instantly flag this, then you can’t be helped.

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vertical-lift@reddit

That's weird. Worked for my wife growing up. It's working for my children now.

What part of it doesn't work?

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Your reading comprehension seems to be lacking so I’ll make it easier for you: corporate greed will close obvious loopholes like babies having credit cards. Technology will make detection trivial.

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lukkynumber@reddit

1) This is not unethical

2) Yes, it “works”

3) However, lenders look at more than just the credit score. They look at length of credit, and TYPE of payment history.

An 18-year old who has 16 years of perfect payment history and a 770 score because of her parents throwing her on their CC as an authorized user, won’t get treated remotely the same (when applying for substantial debt like a car) as a 35 year old with 16 years of payment history and a 770 score.

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One-Phrase4066@reddit

yup, it works. "my" oldest account is only 8 years younger than me. currently a decade of "average account age" more than i should have.

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HorseForce1@reddit

Until the lender looks at the age and realizes what happened.

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I don't think you are either. I don't think its beneficial to label something like this as "structurally unfair" just because those with more are more likely to benefit. The last thing a child born into a poorer situation needs to hear is people constantly telling them how unfair their upbringing is/was.

They will start out with less than their richer peers, but nothing is preventing them from catching up and later providing a better future for their children than what they had. What's unfair is letting them think its not possible to do so because of their upbringing.

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That1one1dude1@reddit

Not sure why you said the other commenter was talking nonsense, you seem you agree with them.

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Entire_Yoghurt538@reddit

I don't. I don't like the thought of one Parent working hard for their child being considered an "unfair advantage." I don't care if I had it or not, and I will not calling my upbringing unfair. Don't call it "unfair" when one Parent works harder and does more research than another. That is nonsense.

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ThunderCorg@reddit

Yep, if your parents didn’t do this for you but you can for your kid, congrats! You’re the first generation to stabilize and can pass it on.

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TaiChuanDoAddct@reddit

"Structurally unfair" is bullshit.

Every immigrant in America (like my parents) will tell you that they came to America for a better life for their kids. That's the whole damn point.

Have them keep it up for the remainder of their working lives and they retire with ~$8.1 million.

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Zealousideal-Pick796@reddit

I did this for my twins. When they turned 14 I added them as authorized users to a credit card I opened when I turned 18 - their credit history is now older than they are. It’s not even unethical!

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EducatorReady1326@reddit

You can do this in a legal way but in banking it is called a fake “A” it can actually be harder to take on debt because they can qualify for a lower rate with a higher risk. If they want another credit card by a AI underwriter they should be fine but a car or house is not going to happen

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eejizzings@reddit

Not even close to the best 18th birthday present ever lol

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Top_Chair5186@reddit

I read of this tactic by making your kids authorized users on your credit card and it builds their credit as well.

I have an 825 credit score and added them to my card. Once the new cards came in I activated them and cut them up so no one could use them and any use is fraud.

I wish I would've done it earlier but my oldest will have about 4 years of credit and my youngest will have 8 years when they each turn 18. It will help give them a slight boost when going on their own, eventually.

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ArcherFawkes@reddit

Authorized users don't have to be immediate family either. But yes, authorized users can be associated with the original owner's credit card account and get boosted credit if the original owner pays off their card regularly. I had to start my own credit journey when I moved out at 21 because my parents "didn't believe in credit cards", so I never got the opportunity. I wished they started me sooner, but I'm hovering mid 800s right now so I'm not that bad.

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Nicelyvillainous@reddit

…I am fairly sure that your history of credit usage in the past is not a major part of your credit score, it is more about how much people are willing to lend you and the age of your credit accounts. So you absolutely don’t need to spend any money on a credit card for a kid every month, you just make one purchase every 12-18 months to make sure they don’t close the account.

Although it may be based off of unrepresentative information, I do think my score is accurate, I’m a very creditworthy person because I learned good financial habits from them, make a decent income, don’t overspend, and also, quite honestly, I know they would bail me out in a worst case scenario.

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Hefty_Moment4800@reddit

This isn't hard to do. All 3 of my kids had 750 plus credit scores when they went to college. All I did was add them as authorized users on my main credit card. It's one of the best things you can do as a parent to set up your kids for success.

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EducatedBellend@reddit

Add them as a card holder on an existing account. I have credit that is six years older than me and my kid has credit that is 30 years older than them. Thanks mom.

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BunchaMalarkey123@reddit

My parents did this for me. Had an 820 credit score at 18.

All they did was attach my name to one of their credit cards they had for probably a decade already when I was about 17. It was my “emergency-only” card for when I was in college. They let me use it to like book flights home, or in an emergency.

Im 37 now. Their account still has a 70k limit, and is like 30 years old. So it continues to increase my average credit age and the amount of credit in my name. I have no access to the card or the account, just my name attached to it as a user at one point.

Its honestly a HUGE advantage. My siblings and I have all been able to maintain over 800 credit scores. Helped so much when getting a mortgage. My credit is so robust because of it. Ive even screwed up and had late payments that hardly even affected my score.

Parents - if you’re able to do this, it can really help your children.

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rocknroll2013@reddit

Holy Smokes, I am gonna do this for my kids

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chipguy55@reddit

I did this for my kids , started when they were in high school, they didn’t realize what a help it was until they were like 30 and had credit scores of 800 … took em long enough

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dumpster_mongrel@reddit

Doing it for my kids.

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DogsDucks@reddit

My dad did this for me. There was a line of credit open for me as an infant as well as a stock portfolio that I did not know about.

I know this will work because I was the child in this situation. Parents started when I was a wee child. At 18, I had a phenomenal score to start and have kept it up now as an adult.

My parents did this. They used a card in my name for gas, paying it off each month until I started driving. Then I used it for only gas and they paid it off. Gave me a big head start when I needed my credit score!

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strangelove4564@reddit

Charge small things like chewing gum and pay it off every month.

Equifax

AMERICAN CHEWING GUM FINANCING -- Pays as agreed

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Expert-Pepper2083@reddit

I inadvertently done this for my kid brother. He was added on to my card for 5 years, then when he applied for his own card he suddenly had a 700 credit score

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StarFox_73@reddit

My parents did this for me. I have a 790 credit score.

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KIPYIS@reddit

Additionally, add your kid to a frequent flyers program. Itll be nice for your kid when they are an adult and have a bunch of miles and are a 20 year+ member

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Speciou5@reddit

Barely unethical because credit history is the biggest dumbest scam for Americans. You can go from nothing to great by just having a high salary. And if you don't have a high salary you really don't want to be taking credit card debt (22% APR compounding? Jesus Christ) and should lean on other support systems / downsize your living expenses.

If you are absolutely safety net less (ex uncooperative parents, no partner, etc) okay fine for a temporary emergency, but you're better doing another ULPT to figure out how to get food or how to find a cheap rent place or whatever.

This isn’t actually a ULPT. When I went to college my parents added me to their credit card as an authorized user.

KingJeff973@reddit

When you add someone to your credit card, they receive the same credit history of the card. So if the card is 10 years old, it will be a 10 year old account on their credit statement.

Just add your children to your credit cards as authorized users when they turn 18 and BOOM, credit history older than them 😂

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andrewcool22@reddit

You just add the kid to be an authorized user and they sometimes get the whole history of the card (in terms of length)

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b4i812@reddit

Apple Card will do this attached to your card. You can set limits, verification, etc. the bill is combined with your number and you pay on the iphone, just like normal

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MrJaver@reddit

Can you open a cc for 1 year old? I doubt it, are you talking about adding your kids to your cc as authorized user? Then that can be done at 18 and they will have that on their report. But that won’t do shit for taking out loans because creditors will see that it’s not their card, so they will get denied anyway.

Is there a legit way to get their OWN credit history as in their name alone on multiple lines of credit? I assume earliest would be 18 y/o, right? When they can legally sign their own papers

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foxwaffles@reddit

My mom did this to me when I went to boarding school last year of high school and kept it up thru college. I basically had a copy of her card but it was with my name on it. I used it for meals, supplies etc.

If the trust is there it is valuable to help them get ahead. I never ever misused the credit card. I did exactly what I said I would. Meals and supplies. Mom didn't ask for it but I kept the receipts and gave them to her regularly

If I wanted to buy something for myself that wasn't a need, like a video game, I asked mom first (I had money in my own bank account but my mom never let me spend any of it until I graduated, at which point it had grown to be enough for me to use as a down payment. Thanks mom!).

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GaylrdFocker@reddit

Parents can just add their kids as an Authorized User on their credit cards on the kids 18th birthday and they get the entirety of that cards' history. The op is a waste of time.

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GirthyRooster69@reddit

My friend’s mom did this, basically set him up right at 18 with a perfect credit score. He could go get any credit card or car loan he wanted. The downside to this is if the kid is fiscally irresponsible then this is just a slippery slope to mountains of debt.

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kadevha@reddit

I just added my kid as an authorized user to a few of my cards but they will not know about it until it's necessary.

theepi_pillodu@reddit

I'm not sure why you guys are all worried.

I came here to USA(legally) at age 21, got a job on the campus, applied for a credit card (2001, Citi Bank was chill), got $3500, paid on-time religiously, maintained 800+ within 3 years. Of course, my first car loan for $30k was in 2016 (my previous cars and bikes were all cash paid under $10k), that to with a Credit Union at 2.25% with $0 down. I was pre-approved for $650k home loan in 2016, if I wanted to buy a home. I assume they didn't do a hard inquiry.

Have things changed recently?

I added my kids to one of my cc’s when they started driving. I paid for gas and sometimes them getting milk and bread on the way home. Since I had the card since they were babies, they had a card with a 12k limit and 15 years of on time payments.

My dad sort of did this for me by adding me as an authorized user on a card that he didn’t give me until I went away to college.

Bubbly_Day5506@reddit

You have to be 16 to be added to a credit card in the US. I did it for my kids. They both have a credit rating in the 740s.

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dissembler2@reddit

We gave our two high school part-time workers credit cards to use as their paycheck. Abused only once w/ parent in to pay off. It felt really good to do that for them!

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waffleaphobia@reddit

Upside is it can help your kid if they turn out responsible with money.

Downside is it can destroy their life when they can take out a bunch more debt than a normal 18 year old and they ruin their life

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PIF_Daddy@reddit (OP)

Upside: Kid can open a bunch ot high limit cards at 18 and start a small business of their own.

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benaugustine@reddit

Lmao. Using credit cards as a small business loan would be insane

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AndarianDequer@reddit

"Destroy their life" is very much hyperbolic.

Before I even got into college, maybe even grade school, my mom had opened up some credit cards in my name. I didn't realize it but when I turned 26 and was out of school, I went to apply for a credit card to my credit score was absolute shit. I had collections and all this shit that I didn't even understand on me because of the shit my mom pulled. It took some sorting out and within a year or two I had a six or seven hundred credit score.

seancookie101@reddit

I’m 19 and my oldest credit line in 26 years old. My dad added me as an authorized user around when I was 17 and that credit cards whole credit history came into my credit report as an authorized user. He also added me to multiple other cards and I started off at 18 with around $50k+ of credit limit.

At 18 years and 6 months old, I applied to two credit cards at the same exact time and got them both, instant approval. At 19 years 1 months old, I applied to 5 more credit cards at the exact same tome and got approved for all 5.

All 7 of these cards had hefty sign up bonuses, all really good cards. I never had to deal with having a low rewards starter card or a secured card.

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SirBruceForsythCBE@reddit

Why would an 18 year old need credit?

Don't get into debt and life becomes a little bit easier

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cvsrney@reddit

My dad did this for me. Got me a card in both of our names when I was about 14 or 15. I was only allowed to use it for emergencies. And then like when I started driving he’d let me fill my truck up on Friday with it, but outside of that still only allowed to be used for emergencies.

I’m 43 now and we still have the same thing. I seldom use it at all. It’s has a huge credit limit now so like the random time I’ve needed it I’ve used it and just pay dad back (he still gets the bills). We mostly keep it because it keeps my average credit history really long.

I didnt become literate on credit until AQUIRED a book online for FREE.99 and it broke done credit.credit hacks. And how to remove collections yourself.

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nobody-u-heard-of@reddit

The only unethical thing is this whole credit score system. How's your credit score worse when you pay off your debt? Yep, if you do that, you'll see your credit score fall. There's a whole list of things that don't make logical sense and don't actually represent your ability to pay, but that's how credit scores work here in the US.

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DrNukenstein@reddit

Because credit card companies make their money on the interest. If you use the card and pay the full amount, you’re paying the minimum interest. It’s likely not enough to cover the maintenance cost of the account. Hence, your credit score is “how much money can we make off them” more than “how financially responsible are they”. However, there’s a balance point. It takes years to go from $300 secured credit to $20,000 unsecured credit. Secured accounts carry no risk for them, because your security deposit will cover a default. Unsecured accounts rely on you paying the minimum amount every month while not maxing out the card. If you do max it out, and charge more on it every month than you pay on it, then they start sweating a possible default. This drives your score down. If you run it up and then stop using it, even though you haven’t maxed it out, and focus on paying down the debt before resuming using it, that reflects a somewhat mature financial strategy that is beneficial to the creditor.

Credit companies report your account stewardship to agencies that share that info with other lenders, such as rival companies and banks. When you apply for credit or a loan, they can check how your other card issuer views your risk level, and may decline or welcome your business.

If you’re not getting credit card offers in the mail, your credit is likely in the toilet.

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nobody-u-heard-of@reddit

And those credit scores have an impact on your mortgage, your auto loan, even your insurance rates. So you pay higher insurance rates because you pay off your debts.

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Significant-Pick-966@reddit

I watched my parents get turned down over and over as a kid because they didn't have credit cards and when they did get a bank loan they would pay it off early. They were told they didn't have bad credit they had no credit so they couldn't get the rainbow vacuum on a payment plan. To this day I still don't understand why them paying things off early by making double and triple payments or selling a big ticket item and paying things off quickly gave them non existent credit. I would think anyone selling something would want them buying it as they always paid for the items bought on credit early. The only thing I can think of is the companies would rather sell to someone who will slowly pay things off so they get more in interest even with the odds they won't be able to make the payments and they will have to take the item back due to delinquent payments

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SnooPineapples521@reddit

I’ve never thought of that. My oldest is 13, she has a trust from a settlement but if I can get them set up that’d be pretty cool

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SLCIII@reddit

Can confirm, is an actual thing.

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Likely_Not_Your_Mom@reddit

Yes. My (now adult) child has been an authorized user on our cards since they were like 9. By the time they were 18, they had like a 780 score.

Intelligent_Ear_9726@reddit

I thought that would be an ethical thing to do lol is it not?

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Deathglass@reddit

In the US, illegal immigrants often do this with their legal kids.

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BotGeneratedReplies@reddit

I don't even think this is unethical. Parents help their kids build credit all the time by helping them open a secured credit card.

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Hollerado@reddit

Alot of people do this. We have a CC with a 500 limit under our kids' names and make a 5.00 donation to Wikipedia on it every month.

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tatiwtr@reddit

I was an authorized user on my parents credit card and had 20 years of perfect credit history in my 20s.

All my kids are auth'd users on my cards now.

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Many-Eyes666@reddit

This definitely works, but its important to explain credit to your kids, especially without fully developed brains, this can be awful.

I had outstanding credit as an 18 yr old. I was working at hottopic, and had to buy a not so punk jacket, so I went to old navy. The store clerk asked if I wanted to sign up for their card, and working a couple stores down at the mall, knowing what it's like to constantly have your manager push for card signups, I thought I would do them a favor, and sign up for their store card.

Well, imagine my surprise when I was offered an old navy credit card with a 3k dollar limit.

I maxed that card. I never paid it. It went to collections, and after 7 or so years I received a letter in the mail, "notice of cancelation of debt". Sweet. Don't have to pay, never got in trouble.

jckipps@reddit

Only a good idea if the kid has been well educated and cautioned about the use of credit.

If they suddenly get access to good credit, how badly could they screw themselves over?

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