By Tom Michaels*
Before I started college, I was nervous about a lot of things: making new friends, landing an internship, doing well in classes. But I didn’t need to be. I ended up becoming friends with a great group of people, was offered a fantastic writing internship in my university’s media relations department and graduated at the top of my class.
It wasn’t until spring semester of my senior year that I realized there was something else that I should have been worried about—something I’d never given much thought to at all until then.
Like many parents with kids going off to college, mine thought it’d be a good idea for me to have access to an “emergencies only” credit card at school. So about a month before I moved to campus, my mom and I visited our local bank and opened a joint account with a $1,000 limit.
That was that. In the long list of things I had to do to prepare for college, applying for the credit card was, in my mind, a very small footnote. And since I never used the card, I didn’t think about it again for years. So you can imagine my surprise when, on a whim, I logged into my account three months before graduation and saw a balance of more than $9,000.
A quick, confused call to my mom revealed that she had been using the card all along—and that the credit card company had increased the limit as she spent more and more. “Don’t worry,” she said, “I’ve been making payments, and the balance is going down.”
I wanted to believe she had it under control, but I was concerned. I wanted to own a house one day, and though that was a far-off dream, I could envision this debt getting in the way. I didn’t know a lot about credit at the time so I did some online research, and I discovered that I was legally responsible for any charges on the account. The thought was terrifying.
Over the next two years, my mother held up her end of the bargain and made regular payments—until my father lost his job. Although my mom worked part-time, she could no longer afford to cover the credit card bill and, to make matters worse, started using it again to fill gaps in their budget—groceries here, an electric bill there—until the balance ballooned to $15,500.
So I stepped in to shoulder the $300 monthly minimum on top of my $900 monthly student loan payment. (I owed about $60,000 in student debt.)
I didn’t want to do it: I’d just landed a project management job and was excited to make some headway on my own finances. But I felt like assuming this responsibility was my only option if I didn’t want the card to go into default or watch my 705 credit score tank. I made the payments for two years until my dad found a new job and my mom took over the payments again.
While I’m thrilled the monthly burden is no longer mine, I’d be lying if I said I wasn’t a little bitter about the $7,200 I shelled out to cover a debt that wasn’t mine to own. It’s money I won’t get back—that I could have used to pay down my loans faster or up my retirement contributions. A part of me can’t fully trust, or forgive, my mom for putting me in this situation. If my dad loses his job again, or something else prevents my mom from making the payments, legally, the debt falls back on me.
I love my mom, but now realize that I, too, made a mistake by signing up for the account. If I had a do-over, I’d simply wait to apply for credit until I could be approved without a cosigner. That way, I’d only be responsible for my own actions, and my relationship with my mom wouldn’t have this financial strain imposed upon it.
Beyond the dangers of having shared credit, I also learned from this experience that the whole idea of an “emergency” credit card is risky in the first place since you’ll still be responsible for paying that off—and with interest. An emergency savings account is a much better way to prepare for the unexpected. I’m regularly contributing to my own savings account now and have two months’ worth of expenses saved up so far. My ultimate goal is to have six months’ worth.
That way, if my car needs a repair or my cat gets sick, I’ll be covered—without needing to rely on credit.
*Name has been changed to protect his parents’ privacy.
February 22, 2016