Can You Get a Credit Card at 16?

If you’re 16 and want a head start on building credit, a credit card may seem like an obvious move. But you can’t get one in your own name yet. Card issuers require you to be an adult to sign the agreement. Until you’re 21, the Credit CARD Act of 2009 also requires income of your own or a cosigner who’s at least 21.

A parent or guardian can add you to their card as an authorized user, though. You aren’t the primary account holder, so they stay responsible for the account.

Some issuers report authorized users to the credit bureaus right away, and others wait until you’re 18. Have the cardholder ask the issuer before adding you.

How to become an authorized user at 16

The cardholder can contact their card issuer and ask about adding a teen as an authorized user. The card issuer will need some basic information, such as your name, date of birth, and Social Security number. You’ll get a card linked to their account, but the account stays their own.

How authorized user status affects your credit

As an authorized user, you can build credit by being associated with the cardholder’s financial activity. If the cardholder manages their account well, pays the bill on time, and keeps their credit-utilization rate low, the account’s on-time history can show up on your credit report.

However, it works both ways. If the account holder misses payments or maintains a high balance, it could negatively affect both their credit and yours.

Risks to consider

Becoming an authorized user on a credit card at 16 can be risky, as late payments on the card can show up on your report too once the issuer reports you. The cardholder takes on risks too. They’re responsible for every charge on the account, including yours. Some issuers let them set a spending limit on your card.

‍2 questions to ask before you’re added. Being an authorized user only builds credit if the issuer actually reports it.

Two questions to ask first:
1. Do you report authorized users under 18? Some issuers have a minimum age for reporting, even when they’ll add a minor to the account.
2. Which bureaus do you report to? If it’s only one, your file builds unevenly, and a lender pulling a different bureau won’t see it.

Call the number on the back of the card and ask before anyone fills out a form.

Do debit or prepaid cards build credit?

No. A debit card spends money from your bank account, and a prepaid card spends money you’ve loaded onto it. Neither one involves borrowing, so neither shows up on your credit report.

They’re still worth having. A debit card is a low-risk way to practice budgeting and track your spending before you have a credit card to manage. At 16, you’ll usually need a parent to open a teen checking account with you, so ask your bank what it offers.

When can you get your own credit card?

At 18, you can apply for a card in your name, including a secured card, which uses a refundable deposit as your credit limit.

Until you turn 21, though, you’ll need to show you can make the minimum payments on your own or have a cosigner who’s at least 21. Not every issuer accepts cosigners, so ask before you apply.

At 21, that extra step disappears. Issuers can also count income you have reasonable access to, such as a spouse’s or partner’s, not just your own.

Read more >> How to Build Credit From Scratch

Bottom line

At 16, an authorized user spot on a parent’s or guardian’s card is the closest you can get to a credit card. Pick a card whose issuer reports users your age. That record still belongs to someone else’s account. When you turn 18, Kikoff’s Credit Account lets you add on-time payment history in your own name, reported to Equifax, Experian, and TransUnion. No credit check to sign up, and plans start at $5 a month.