Four reasons to add your teen as an authorized credit card user

But keep in mind…

While adding your teen as an authorized user can make a lot of sense, you should still tread carefully. Here are some factors to consider as you ponder this move:

• All liability is yours: When you add an authorized user to your credit card, you take all liability for their purchases — whether those purchases were authorized by you or not.

• Potential credit damage: If your teen gets out of hand and runs up a balance you cannot repay, any late or delinquent payments will go on both of your credit reports. That's why it's a smart move to put a cap on how much they're allowed to charge or use a card with a lower credit limit.

• Possible drama: If your teen has trouble with spending limits, uses their credit without your permission, or is otherwise unreliable, you can expect some bumps along the road.

While these disadvantages are real, the easiest way to avoid a sticky situation is to set account limits on how much your teen can spend — and when. By adding these limits, you can save yourself the headache of finding out that your teen overspent.