PSA - Hoping this helps someone in the future - about “joint” credit cards

[Hoggirl]

My fil passed away a couple of weeks ago.  He and mil had two credit cards that they were both “on.”  Dh and I had erroneously assumed that they were “joint” cards, and functioned not unlike how a joint checking account would.  It turns out that for most credit card companies there is only one “owner” on the card and anyone else (even a spouse) is simply considered an authorized user.  When the owner of the card dies, that card gets cut off from usage.  Mother-in-law had no credit card that was solely in her name.  Neither did she have a debit card attached to her bank.  She does have an ATM card for their joint checking account, and thankfully, that is well-funded.  She is now in the process of applying for her own credit card(s). 

I’m just putting this out there in case others are making these same assumptions.  I will link an article from AARP that discusses this.  This was exactly what happened to mil - she was denied use of the card at the grocery store. Dealing with the loss of a spouse is bad enough.  Just hoping to prevent this from happening to folks on here.  I would encourage everyone to have at least one credit card on which they are the primary.  

https://www.aarp.org/money/credit-loans-debt/info-2018/debt-after-death.html

[Sneezyone]

Good info., thanks. I’ve always maintained a card in my name but it’ll be nice to have something I can send to DH explaining why this is valuable. ‘Because I want to’ isn’t enough sometimes.

Edited September 5, 2018 by Sneezyone

[TheReader]

This is good info; I wasn't aware of this. Thank you! 

And I'm sorry for your loss, and the extra issues your MIL has faced. 

[GailV]

I'm not surprised to learn this.  I've tried to correct some things (regarding online access) on a credit card that has dh listed as the "primary" and me as an "authorized user", and the company absolutely refuses to deal with me  -- they will ONLY speak to the "owner", or at least someone they perceived to be the owner since, really, it's a phone call and how do they know who they're talking to.

I'm so sorry for your loss, and wish you well sorting things out. That must have been very surreal for your MIL in the grocery.

[mlktwins]

When I got married, I kept the card I had in my own name and still have it.  I spend on it very occasionally to show some activity and I will not get rid of it for the reason you described.  DH and I have a couple of joint cards.  He is the primary on some and I'm primary on the other.

 

[MysteryJen]

This is why I have kept my cc that I have had since college. Dh thinks it is slightly ridiculous and that we should cut our cards down to 1, but he has grudgingly agreed that it makes sense.

This was after a day with cc fraud and I couldn't take care of it and he had to spend the day on the phone (as the primary owner.)

[Acadie]

On a related topic, my sister found that after her divorce she wasn't able to obtain her own credit card, because her ex had the lion's share of their income, and hers wasn't enough to qualify. The impeccable credit she'd maintained by paying their bills on time, earning part of their collective income, and handling the rest of their financials was meaningless, because it wasn't considered hers.

Our financial system leaves women vulnerable in so many ways.

How can we protect ourselves? Independent credit, independent income, utilities in our own names, sufficient retirement, good credit history--how to accomplish all this??? And anything else?

Amy

Edited September 5, 2018 by Acadie

[Jean in Newcastle]

I just found this out the other day when I tried to make some changes to our info for a “joint “ card. Dh was able to tell them to give me the same rights he had. (I do have other cards solely in my name). 

[Pippen]

Also along those same lines--my mom recently passed away. She listed me on the beneficiary on her checking account but not her savings account. I'm certain it was just an oversight, but her savings are frozen until the paperwork comes through appointing me as her personal representative. So right now instead of her house and car payments coming out of her savings, they're coming out of ours. 

[SereneHome]

Wow, I guess sometimes my laziness pays off.  Both, my husband and I kept our credit cards from our single days bc we just never got around to changing anything.

On a kind of separate note, I had a hard time once getting our 1098 from mortgage company bc my husband's name is first on the account.  I don't recall all the details, but I do remember it being more complicated than it should have been.

[milovany]

6 hours ago, GailV said:

[snip] the company absolutely refuses to deal with me  -- they will ONLY speak to the "owner" [/snip]

 

With some finance companies, you can ask them to get verbal permission from your husband to talk with you and they keep this on record so that from that time on, you can make the call yourself.  Not all finance companies do this, though. 

[Arcadia]

9 hours ago, Sneezyone said:

 I’ve always maintained a card in my name but it’ll be nice to have something I can send to DH explaining why this is valuable. ‘Because I want to’ isn’t enough sometimes.

 

5 hours ago, Acadie said:

On a related topic, my sister found that after her divorce she wasn't able to obtain her own credit card, because her ex had the lion's share of their income, and hers wasn't enough to qualify. 

How can we protect ourselves? Independent credit, independent income, utilities in our own names, sufficient retirement, good credit history--how to accomplish all this??? 

 

After we relocated to the states, we realized from the mortgage officer and car dealership agents the importance of credit history. We went and opened a secured credit card in my name for the sake of my credit history probably ten years ago. Utilities are in my name because if anything happens to my husband, the last thing we want to do is worry about electricity and gas utilities especially with me being a non-driver. If anything happens to me, he has bereavement benefits and would easily get those utilities settled in a day of driving around and waiting.

We knew about the joint account and authorized user portion since we asked plenty of questions being foreigners here. Below quoted is why we decided against joint accounts and instead opt for me to have my own credit cards. 

”With a joint credit card, you’re both liable for the debt on the account. By using the account responsibly, you can both strengthen your credit. On the other hand, missed payments and overspending will hurt you both. Remember to communicate often about your balance and payments so neither of you makes a costly mistake.” https://www.nerdwallet.com/blog/credit-cards/difference-between-authorized-users-and-joint-cardholders/

[Pawz4me]

I'm sorry about your FIL, Cynthia. And your mom, Pippen.

I guess I've always known that a cc is "owned" by a primary person. DH and I have been married for 28 years and we've always maintained separate cards for this very reason, plus making sure that both of us keep stellar credit scores. Weirdly enough--and I don't know why--despite not having earned any income for about 23 years now I've never had any problem getting a new card in my name. Not that I've ever gotten many, but in the years I wasn't working I think I changed cards at least a couple of times (both times for better rewards).

[GailV]

5 hours ago, milovany said:

 

With some finance companies, you can ask them to get verbal permission from your husband to talk with you and they keep this on record so that from that time on, you can make the call yourself.  Not all finance companies do this, though. 

We tried that, and this one does not.  

That was a good thing to point out to others, though, so thank you.

[SebastianCat]

We had a similar issue with DH and his parents.   He had acting Power of Attorney for them and was added to their accounts as POA, but when MIL passed away, so did his access because he wasn't on the account as a joint owner, just as POA.   FIL had advanced dementia and his name wasn't on the accounts (for that reason), so it was not fun to get that straightened out so DH could pay their bills and settle estates.  

So I would add to the PSA:  If you are ever in a situation to act as POA for an elderly parent, get your name added on their accounts as a joint owner early in that process, so you can continue to manage their expenses after their passing.

[marbel]

 

47 minutes ago, SebastianCat said:

We had a similar issue with DH and his parents.   He had acting Power of Attorney for them and was added to their accounts as POA, but when MIL passed away, so did his access because he wasn't on the account as a joint owner, just as POA.   FIL had advanced dementia and his name wasn't on the accounts (for that reason), so it was not fun to get that straightened out so DH could pay their bills and settle estates.  

So I would add to the PSA:  If you are ever in a situation to act as POA for an elderly parent, get your name added on their accounts as a joint owner early in that process, so you can continue to manage their expenses after their passing.

 

A living trust might be another way to do that, though I am not giving legal or financial advice here.  :-)   My mother had a living trust; I was trustee; when she died I notified her bank, gave them the documents they wanted, and started signing checks within a few days.  Credit cards weren't an issue; she didn't have any.  (And I know credit cards are the main topic.)  It also made closing out investment accounts very easy and straightforward. 

[madteaparty]

11 hours ago, Pippen said:

Also along those same lines--my mom recently passed away. She listed me on the beneficiary on her checking account but not her savings account. I'm certain it was just an oversight, but her savings are frozen until the paperwork comes through appointing me as her personal representative. So right now instead of her house and car payments coming out of her savings, they're coming out of ours. 

I went and added a “transfer on death” to all our accounts. It’s just one form per account. In the case of one account where the bulk of the $ would be I know it was done because JTOD or some such initials (joint, transfer on death) are added to the account numbers every time I get a statement. 

I just need to remember to let the transferee know this exists before DH and I go rappelling down caves next year ?

Edited September 5, 2018 by madteaparty

[Murphy101]

Right. Payable on death is the only reason I had a few bucks to pay towards my dad’s funeral. Otherwise everything would have been tied up until the estate was settled in another state. And they won’t keep a body in ice that long here without exhorbant daily freezer fees. 

Payable on death meant the day he died whatever was in that account was already mine to use however I wanted/needed.

[Garga]

2 hours ago, SebastianCat said:

We had a similar issue with DH and his parents.   He had acting Power of Attorney for them and was added to their accounts as POA, but when MIL passed away, so did his access because he wasn't on the account as a joint owner, just as POA.   FIL had advanced dementia and his name wasn't on the accounts (for that reason), so it was not fun to get that straightened out so DH could pay their bills and settle estates.  

So I would add to the PSA:  If you are ever in a situation to act as POA for an elderly parent, get your name added on their accounts as a joint owner early in that process, so you can continue to manage their expenses after their passing.

 

My parents had us on their savings account and we researched and found that this could be a problem when college rolled around.  It would look like we had bunches more money to pay toward college than we did.  We had our names removed from their account so we’d have a shot at financial aid for college.  We didn’t want to remove ourselves from their account at the last minute before college, because FAFSA looks at your financial picture from 2 years ago.  Perhaps there are ways around this that I don’t know about, but I didn’t want to run into any roadblocks, so we just got off the account.  

 

Edited September 5, 2018 by Garga

[Hoggirl]

12 hours ago, Pippen said:

Also along those same lines--my mom recently passed away. She listed me on the beneficiary on her checking account but not her savings account. I'm certain it was just an oversight, but her savings are frozen until the paperwork comes through appointing me as her personal representative. So right now instead of her house and car payments coming out of her savings, they're coming out of ours. 

 

This was yet another issue that cropped up with Fil’s passing.  Of their two credit cards, one was paid direct draft out of their joint checking account.  The other, however, was paid directly out of a bank account that was solely in his name.  So, not only was the card denied, but the payment wasn’t made on time.  Dh paid it over the phone with a check out of our checking account.  There was one other direct pay out of the only-in-his-name bank account to their local athletic club.  Mil was able to easily switch that over by taking in a check from the joint account.  But, of course, this was a local organization who had known both of them for years.  She changed the payment method when she changed the status of her membership to single. 

The only other thing that had been paid directly on one of those credit cards was their Netflix.  We’ll have to switch that.  

Fortunately, all their regular household bills were set up to pay directly out of their joint checking account.  

[Murphy101]

I plan to get my own credit card next year. I already have my own bank account that husband is not listed on. All household expenses come from it. And we have a join account that an allowance for his expenses goes into.

Most other things are in both our names as and/or. 

Dh has a crap ton of debt that I never would have agreed to, but we are married so it screws my credit anyways. I really wish there was a way to avoid that. I think if I didn’t sign for something, I shouldn’t be held liable for it. Especially as I sure can’t go get anything without his signature. I could understand if it’s “his money-his debt” but it’s “his money-our debt”.  So either fix the law or give me equal rights to his income while married. Ticks me off. 

Edited September 5, 2018 by Murphy101

[Hoggirl]

8 minutes ago, Garga said:

 

My parents had us on their savings account and we researched and found that this could be a problem when college rolled around.  It would look like we had bunches more money to pay toward college than we did.  We had our names removed from their account so we’d have a shot at financial aid for college.  We didn’t want to remove ourselves from their account at the last minute before college, because FAFSA looks at your financial picture from 2 years ago.  Perhaps there are ways around this that I don’t know about, but I didn’t want to run into any roadblocks, so we just got off the account.  

 

 

Slightly off topic from this, but I made sure we had a payable on death account set up for ds that would cover at least a quarter’s (his school was on quarters not semesters) worth of expenses for college.  

We redid wills when ds turned 18.  The option of a living trust was discussed then, but we didn’t proceed as it seemed tedious.  However, I am determined that we will deal with tedious now rather than causing someone else to have to deal with tedious later. 

[Murphy101]

I took all my kids off our accounts and alas my under 18 kids no longer have accounts at all. 

Because of dh’s debts. It’s all money he in theory would have access to, which means it can be taken for his debts. Doesn’t matter if the actually money isn’t his because if our name is on it - it’s deemed our money too.?

[marbel]

So if a spouse is an authorized signer only, and has no real right to the card once the primary cardholder has died, can that person just walk away from the debt (assuming there's a balance on the card when the primary cardholder dies)?   I guess at that point the debt belongs to the estate, not the individual?  

[klmama]

1 hour ago, marbel said:

So if a spouse is an authorized signer only, and has no real right to the card once the primary cardholder has died, can that person just walk away from the debt (assuming there's a balance on the card when the primary cardholder dies)?   I guess at that point the debt belongs to the estate, not the individual?  

It probably depends on state laws.  Some states have community property laws where all assets and all debts are shared by married couples, regardless of whose name is on the account, deed, etc.  

[goldberry]

4 hours ago, SebastianCat said:

So I would add to the PSA:  If you are ever in a situation to act as POA for an elderly parent, get your name added on their accounts as a joint owner early in that process, so you can continue to manage their expenses after their passing.

 

Just this past summer my sister and I were added to all my parent's accounts, checking, savings, etc.  

[G5052]

That goes for more than credit though.

When DH and I separated, we still had separate credit cards, so I didn't have that issue. HOWEVER, I had all kinds of adventures with the power company, cable, a bank account, and a few others. A friend of mine that was widowed had the same thing.

It isn't like a death, but I had to close some of the accounts related to the house and then reopen them in my name in order to do anything with them. In some cases a deposit was required that was refunded when the house was sold, but an additional $350 to the power company in a tight month was depressing. They also took me off of the budget plan that had even monthly payments because I had no "history" despite paying the bill for twenty years (sigh). The cable company had to close the account and then open a new one, but I didn't get the refund for many months because it went to DH. We also had some issues with our email accounts with them. Thankfully, the gas company account was in just my name. I remembered that they hooked it up with DH wasn't home twenty years ago, and I guess we never put in both names.

So make sure both names are on utility accounts and anything else that will go on afterwards.  

[Amy in NH]

14 hours ago, milovany said:

 

With some finance companies, you can ask them to get verbal permission from your husband to talk with you and they keep this on record so that from that time on, you can make the call yourself.  Not all finance companies do this, though. 

 

 I handle all of the finances, but DH has the income so the cc are in his name.  I just tell them I'm him when I have to call for any reason.  I have all his personal information to answer the identity verification questions, and even the security questions since I'm the one who set them up in the first place.

[Murphy101]

17 hours ago, happysmileylady said:

Murphy101, after reading more about those 10 community property states, I am assuming that you must live in one of those (I had never really understood what "community property state" meant, we didn't come across such a thing when dealing with FIL's estate.

 

But even so, debt in his name only shouldn't affect your credit report.  The only time it should come into play is if you guys are trying to get a loan/CC together.  Like if you were trying to get a mortgage or a car loan with both of you on the loan.  

 

That would be true if I had my own job/income, but I don’t. 

So what income do I have to list to attain any credit? His. And bam, there goes my chances of getting it. Even if I’m not putting him in the account. 

And it’s not just that actually.  Dh has a $3k medical bill I didn’t know about from 2 years ago that wasn’t paid.  In my state, spouses are held liable for all medical debts too.  So when dh got a court summons to pay or have his account garnished, so did I.  If he doesn’t pay out of his account or paycheck, they’ll take it out of mine. And that is on on my credit report too.

Frankly, there’s a lot of crap on my credit report that is all him.

And yes, I’m in a communal property state, and in my state, it’s even in death. When my dad found out my mom was dying of her cancer, he filed for divorce after 35 year of marriage because otherwise, he’d have lost everything paying her medical bills after she died. As it was, he still came close by the time she died.

And this is per the advice of lawyers.  In my state, there is nothing short of divorce or not getting married that can protect a spouse financially from whatever their spouse’s financial problems might be. Which again, I wouldn’t mind so much if the law was consistent. His money-our money-our debt. But it isn’t. It’s only just his money until they want a debt paid, then suddenly it’s all communal.  My state doesn’t give a toot about joint access otherwise. My husband could refuse to give me a dime (he is not like that thankfully) and unless I could scrounge the money to go to court to file divorce, I couldn’t do anything about it. He has no obligation in my state to disclose or share any of his financials with me.

 

Edited September 6, 2018 by Murphy101

[Murphy101]

15 hours ago, Amy in NH said:

 

 I handle all of the finances, but DH has the income so the cc are in his name.  I just tell them I'm him when I have to call for any reason.  I have all his personal information to answer the identity verification questions, and even the security questions since I'm the one who set them up in the first place.

 

Just like signing a spouse’s signature because they aren’t there to do it for whatever reason. 

Couples commit this kind of identity fraud all the time. But I think it’s ridiculous that they should have to in the first place. If you are one in the eyes of the law for the debt, then it shouldn’t matter. 

[elegantlion]

On 9/4/2018 at 8:02 PM, Acadie said:

On a related topic, my sister found that after her divorce she wasn't able to obtain her own credit card, because her ex had the lion's share of their income, and hers wasn't enough to qualify. The impeccable credit she'd maintained by paying their bills on time, earning part of their collective income, and handling the rest of their financials was meaningless, because it wasn't considered hers.

 

When I got divorced, our main utility company, which was run by our city hall, refused to let me remove ex's name without paying a new deposit. It was aggravating because I didn't have the money for a new deposit, but because ex had went and made it initially it was solely in his name. *I* was the one that paid the bill all the time. They let me add my name, but then the bill still would come in his. I really wish I'd written into the divorce decree that the utilities would be switched to my name. At one point, we both went in there and asked, but they wanted to refund the deposit to him and make me pay a new one. Ex would have never paid me for it, so we just left it. Thankfully, we sold that house this summer and I no longer have to deal with it.

[SebastianCat]

On 9/5/2018 at 10:09 AM, marbel said:

 

 

A living trust might be another way to do that, though I am not giving legal or financial advice here.  :-)   My mother had a living trust; I was trustee; when she died I notified her bank, gave them the documents they wanted, and started signing checks within a few days.  Credit cards weren't an issue; she didn't have any.  (And I know credit cards are the main topic.)  It also made closing out investment accounts very easy and straightforward. 

 

On 9/5/2018 at 10:23 AM, madteaparty said:

I went and added a “transfer on death” to all our accounts. It’s just one form per account. In the case of one account where the bulk of the $ would be I know it was done because JTOD or some such initials (joint, transfer on death) are added to the account numbers every time I get a statement. 

I just need to remember to let the transferee know this exists before DH and I go rappelling down caves next year ?

 

On 9/5/2018 at 10:37 AM, happysmileylady said:

Actually, it's better to have "Payable on Death" on bank accounts.  That way, when someone passes away, that money is paid out immediately and is not part of the estate.  I was so thankful that FIL had DH and his sister listed as Payable on Death and NOT as joint account holders because they were able to access the funds immediately instead of needing it to settle the estate.  

 

 

On 9/5/2018 at 11:09 AM, Murphy101 said:

Right. Payable on death is the only reason I had a few bucks to pay towards my dad’s funeral. Otherwise everything would have been tied up until the estate was settled in another state. And they won’t keep a body in ice that long here without exhorbant daily freezer fees. 

Payable on death meant the day he died whatever was in that account was already mine to use however I wanted/needed.

 

On 9/5/2018 at 11:16 AM, Garga said:

 

My parents had us on their savings account and we researched and found that this could be a problem when college rolled around.  It would look like we had bunches more money to pay toward college than we did.  We had our names removed from their account so we’d have a shot at financial aid for college.  We didn’t want to remove ourselves from their account at the last minute before college, because FAFSA looks at your financial picture from 2 years ago.  Perhaps there are ways around this that I don’t know about, but I didn’t want to run into any roadblocks, so we just got off the account.  

 

 

These are all excellent points - thanks for the information.    We are still a couple years away from college and FAFSA, so I had no idea that financial aid could be affected.