In today’s post CARD-Act environment, most of theunder-21 set will be unable to qualify for their own credit card under the newmarketing restrictions and ability-to-pay provisions. For those withteens and importantly young college students, authorized cardholder status maybe one of the few credit-based alternatives. This article notes featuresoffered by American Express which can make the authorized cardholder experiencemore palatable (to both young cardholders and their parents).
American Express’ Custom Limits
feature allows parents to add a spending limit just to the child’s credit card.This means you can continue to use your AmEx card the way you always have, butyour 16-year-old would be limited to, say, $200 before the card gets declined.
Parents can alsoincrease or decrease the card’s limit at any time. So if your littlefashionista needs some extra cash for a back-to-school wardrobe, you canincrease the amount she can spend for just that one shopping trip.
The card also features a separate account number forthe young cardholder so that if the card is lost (or perhaps compromised in an onlinetransaction), the master (parent) account will not have to be cancelled andreissued. The only additional cost for using the features is the annualfee for adding an additional card to the account.