Do you have children that are approaching the driving age? Are you kids looking into buying their first car? One of the worst things you can do is co-sign for a an auto loan for your kids because, let's face it, they're probably going to make a couple of late payments. If you don't want those late payments showing up on your credit report then you might decide to pay the auto payment yourself. That's not fun. Paying someone else's bills has never been my idea of a good time. I have a better idea.

There is a better way. Your kids cannot get financing because they have no credit at all. Instead of having them go out and establish credit just so they can buy a car, you can have them piggy back on your credit.

Piggy back on your credit? What the heck does that mean?

If you were to add someone to your credit card or department store charge card as an authorized user, that account and its entire payment history will probably show up on that persons credit report. This will give them instant credit. The best part is that these accounts are not new. New accounts really don't help your credit scores because they lack seasoning. Your credit cards are already seasoned. You can add year and years of history to your children's credit be adding them to you accounts as an authorized user. This process is commonly referred to as "piggy backing".

Once the accounts show up on their credit report, their credit scores will now take into consideration the activity on those accounts and the credit scores will sky rocket. Now your kids can go out and get a decent car without getting ripped off by the auto financing companies. The best part is that if and when you kids make a late payment on their car, it won't affect your credit at all.

The only risk is that once they have been added as authorized users, they are legally allowed to use the account if they are given the card. Just don't give them the plastic and you will be fine. Also, each creditor has a certain element on control that they will give you so that you can determine how much an authorized user can spend on that account. Call you credit card companies to find out more about what the potential risks are but don't tell the customer service agent that you are trying to increase your children's credit scores. They are trained to tell you that it doesn't work. If it really didn't work, I'd tell you because all of y accounts are authorized user accounts and my credit score is still in the 800s.

PS: Thanks Grandma for adding me to you 20 year old credit cards as an authorized user. Now have excellent credit scores and I can finance anything I need to and get great terms and payments.

Warm Regards,

Jack B. Olson

TrueCredit 3-Bureau Credit Report & Credit Score