Can a 16-Year-Old Get a Credit Card?

Credit cards offer convenience for purchases and help establish a financial history. Understanding eligibility is important for managing money effectively. Many younger individuals inquire about obtaining a credit card to build financial standing.

Understanding Age Requirements for Credit Cards

Federal law in the United States sets specific age requirements for individuals to obtain a credit card in their own name. Generally, an applicant must be at least 18 years old to enter into a credit card contract. However, the Credit Card Accountability Responsibility and Disclosure Act of 2009 (CARD Act) introduced additional stipulations for applicants under the age of 21.

This legislation requires individuals between 18 and 20 years old to demonstrate an independent means of repaying debt, such as sufficient income. Without verifiable independent income, an applicant in this age group needs a co-signer to be approved for a credit card. Many major credit card issuers no longer allow co-signers, which can make it challenging for those under 21 to secure their own credit card.

The Authorized User Option

While a 16-year-old cannot apply for their own credit card, they can gain access to one by becoming an authorized user on an existing account. An authorized user is an individual added to a primary cardholder’s credit card account, allowing them to make purchases using a card issued in their name. This arrangement differs significantly from being a primary cardholder or a co-signer, as the authorized user is not legally responsible for the debt incurred on the account.

To add an authorized user, the primary cardholder contacts their credit card issuer, either by phone or through their online account portal. The primary cardholder needs to provide the authorized user’s full legal name, date of birth, and sometimes their Social Security number and address. Many credit card issuers allow authorized users as young as 13 or 15, with many having no minimum age requirement at all for this role. Once approved, a card may be issued in the authorized user’s name, which can be used for transactions.

Key Considerations for Authorized Users

Becoming an authorized user offers a practical way for a 16-year-old to begin learning about credit and potentially build a credit history. The authorized user’s credit report may reflect the activity of the primary account, which can be beneficial if the primary cardholder manages the account responsibly with timely payments and low credit utilization. However, this also means that irresponsible financial behavior by the primary cardholder, such as late payments or high balances, could negatively impact the authorized user’s credit score.

The primary cardholder and the authorized user should establish clear agreements regarding spending limits and payment expectations. While the authorized user can make purchases, the primary cardholder remains solely responsible for all charges on the account and for ensuring payments are made. The primary cardholder maintains full control over the account, including the ability to monitor spending, set spending limits, and remove the authorized user at any time. This structure provides an opportunity for financial education and practice without placing legal debt obligations on the minor.