Skip to navigationSkip to main contentSkip to right columnADVERTISEMENTLaura Grace TarpleySun, June 14, 2026 at 8:00 PM GMT+2 5 min readMaking a child an authorized user on a credit card can be one of the greatest gifts parents can give. The short-term gift is that the teen or young adult uses the card to pay for essentials, such as gas or textbooks. The longer-term benefit is that the child can start building credit.But what happens when that “gift” turns into a major burden?Must ReadRobert Kiyosaki says this 1 asset will surge 400% in a year and begs investors not to miss this ‘explosion’The ultra-rich use these 5 real estate strategies to build wealth while they sleep — you can start with just $100Millionaires under 43 are reshaping investing — just 25% of their portfolios are in stocks. Here’s where their money is goingImagine Emily, who received a credit card from her parents when she was 16. Emily is now 22 years old and just graduated from college. She’s had this credit card for six years and knows she’s only charged around $6,000 over that time.But she sets up a Credit Karma account and, when reviewing her profile, discovers this credit card has a whopping $40,000 balance. To top things off, the debt has tanked her credit score. She starts to panic. How did she accrue all of this debt — and worse, how is she going to pay it off?How can Emily dig herself out of this hole?How authorized credit cards workMany teens or young adults don’t understand the logistics of being an authorized user on a credit card when their parents hand it to them. (Heck, the parents may not fully understand, either.) The kid might think this is their credit card. Or, they know they’re an authorized user, but they don’t actually grasp what that means.When Emily’s parents gave her a credit card with her name on it, they were the primary users on the account. So, purchases made by all three people show up on the credit card statement.Instead of Emily’s parents just giving her money for gas, they decided to add her as an authorized user on their credit card so she could swipe it at the gas station. Since her name and credit profile were attached to the card, she could start building credit from a young age.How would she build credit? Ideally, her parents would make regular payments on the card. Payment history comprises 35% of your FICO score. Credit age makes up another 15%, so by already having a credit card for six years by the time she graduated from college, Emily’s credit score should have been solid.Her parents may have intended to help Emily build credit, but this $40,000 credit card debt has actually hurt her score. By not making regular payments and allowing debt to accrue, that 35% payment history section of her score has taken a major hit. Also, amounts owed make up another 30% of her FICO score. The $40,000 is likely a large percentage of their available credit on that card, which hurts her score even more.Terms and Privacy PolicyPrivacy & Cookie SettingsMore Info