Is it time to separate the finances between you and your spouse? Some couples manage their finances separately while others manage their bills together. But in both cases, it’s likely that a person will add a spouse to his or her credit card as an authorized user or open a joint account. And while these arrangements can work well, it sometimes needs to be undone.
How Authorized Users Work
When you add a spouse, or any other person to your account as an authorized user, he or she will receive an additional card, and will be able to make charges to your account. As the primary cardholder, you are solely responsible for paying all charges to your account, including those made by authorized users. However, an authorized user is generally not able to make changes to an account, redeem rewards or close the account.
Removing an Authorized User
There are times that you will want to quickly remove your spouse as an authorized user, such as in cases of divorce or separation, in order to avoid being responsible for their charges. When you added your spouse as an authorized user, you mostly likely contacted your credit card issuer to do so, and removing an authorized cardholder is usually just as easy.
Generally, you can simply call the number on the back of your credit cards and request that the authorized cardholder’s account be removed immediately. You will then be instructed to destroy the cards as well as contact any biller that has the card on file. As a courtesy, you can also notify the cardholder that their card has been removed from your account.
“If a customer would like to remove an authorized user from their account, they need to either call Capital One customer service number or log into our online servicing to request the change,” a spokesperson for Capital One said in an email.
How Joint Accounts Work
A joint account is an arrangement where two people share the status of primary account holder, and both have complete authorization to make any change to an account that a primary account holder would. Additionally, both joint account holders are individually responsible for the repayment of all debts. Many credit card issuers no longer permit joint accounts, although some still do.
Removing a Joint Account Holder
Generally, either party can unilaterally close the account by contacting the card issuer over the phone or in writing. Once closed, the cards of both joint account holders and any authorized cardholders will be deactivated, and any future attempt to make purchases will be declined. Nevertheless, both joint account holders will still be individually responsible for paying off any remaining balance under the terms existing at the time the account was closed.
Streamlining Your Credit Cards During Divorce or Separation
Unfortunately, divorce and separation often lead to credit problems, as financial obligations can fall through the cracks. But it doesn’t have to be that way. Here are some tips that can help you to organize your finances and help keep your credit score intact.
After both spouses have been removed as authorized users from each other’s accounts or joint accounts have been shuttered, it’s time to take inventory of which remaining credit cards you have. Once you have that list, you need to contact each card issuer and make sure that they have your current mailing address so that you can receive your statements.
It’s also important to immediately check the balance of each account and find out when the next payment due date is. To avoid making late payments, you can set up automatic withdrawals from your bank account, or initiate automatic payments to your credit card issuer. Most credit card issuers also allow you to create payment alerts via email or text messages. Finally, you should consider changing your payment due dates to be more convenient for your needs. For example, some credit card users prefer to have their payment due date shortly after they receive their paycheck, so that they can use those funds to make a credit card payment. You could also consider closing any unused credit card accounts, in order to minimize the number of payments you have to keep track of.
Coping With Debt During Divorce
If you find that you have credit card debt in your name from purchases made by your ex-spouse, you should contact your divorce attorney to ensure that these charges become part of the negotiations. But while your divorce is being finalized, you can avoid credit card interest charges by transferring your existing balances to a new account with a 0% APR promotional balance transfer offer. These cards can offer you a break from incurring credit card interest, often for 15 months or longer. However, nearly all of these cards impose a 3% balance transfer fee on the amount transferred. (You can check out the winners of our recent ranking of the best balance transfer credit cards here.)
Going through a divorce is also a crucial time to monitor your credit. You can get a free annual credit report at AnnualCreditReport.com; you can also get a free credit report snapshot, updated every 14 days, from Credit.com. By carefully separating your credit card accounts and streamlining your finances, you can minimize the expense and credit score hit often associated with the unwinding of a marriage.
More on Credit Reports & Credit Scores:
- How to Get Your Free Annual Credit Report
- How Do I Dispute an Error on My Credit Report?
- How Credit Impacts Your Day-to-Day Life
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