When you realise how credit card points open up a world of travel benefits, you’ll probably find yourself thinking of ways to earn more of them.
The problem is it can be difficult to earn enough credit card points to redeem for something meaningful. It’s especially tricky if you aren't a business with a lot of expenses, don't have a large income, don't want to buy stuff just for the sake of it, or don’t want to get involved with something like arbitrage.
But there is a way to rack up credit card points without spending money. At least, none of your own.
Credit card additional cardholders
Although not every credit card supports adding additional cardholders, most frequent flyer credit cards and rewards credit cards do. This means that you can boost the number of points earned.
Adding an additional cardholder is an easy way to earn more points without spending more of your own money.
An example
Say you spend $1,000 per month on your credit card and earn 1 point per dollar. This means you would normally earn 1,000 points per month. If you wanted to book a return business class seat from Sydney to Los Angeles flying with Qantas, you would need around 216,000 points. It would take 22 months to earn enough points.
If you added an additional cardholder to your account and they spend $1,000 per month too, you would earn 2,000 points. This halves the time it takes to accrue the points you need.
Potential problems when adding an additional cardholder
It wouldn’t be rewarding if it were easy. And unfortunately, there are caveats to be aware of.
- The account is your responsibility. You are responsible for account management. If the additional cardholder spends irresponsibly, it’s your problem to deal with.
- It might cost extra. Many credit cards offer free additional cardholders, but some charge an annual fee per additional card.
- One credit limit. Adding more cardholders does not change your credit limit. If you have a high credit limit, that’s less of a consideration. If you have a modest credit limit, you’ll need to clarify how much is available to spend to avoid incurring over-limit penalty fees.
- Your credit score could be affected. Since the account is in our name, your credit score will be exposed to risk (not the additional cardholder/s).
- The additional cardholder’s credit score won’t benefit.
- Not everyone will want to be an additional cardholder. Although you’d be surprised how many people don’t see the value in earning points, some people would rather earn points for themselves.
Benefits of adding an additional cardholder
There are some significant benefits if you add additional, responsible cardholders.
- Earn more points. This is the main reason why most people set up additional cardholders. If done correctly, you can rapidly grow your points balance.
- Hit a bonus target faster. If you would struggle to spend enough yourself, adding an additional cardholder can help you spend enough and get those bonus points.
- No credit report check. Banks do not need to run a credit check to add an additional cardholder.
- No financial association. Even if the additional cardholder has a bad credit score, they can be added. Likewise, their bad credit is not associated with you.
- Give someone with bad credit an option. However, they won’t see any improvement in their credit score.
- Streamlined finances for couples/families. If you give your partner and children cards, everyone can contribute towards earning points whilst keeping all your spending in one place.
How to add an additional cardholder
It isn’t difficult to add an additional cardholder. A lot of credit cards support additional cardholders, especially those that earn points.
- Log into online banking. Locate the form to add an additional cardholder.
- Provide personal details. What’s required varies between banks. Generally, you’ll need to provide the additional cardholder's name and contact details.
- Card issued. The bank will send you a new card for the additional cardholder. It will most likely be delivered to your registered address.
Alternatively, you can call customer service and do it over the phone.
FAQs
Will the additional cardholder’s credit score improve?
No, since the account is not in the additional cardholder’s name.
Is a joint credit card the same as an additional credit card?
No. A joint credit card is issued to two named individuals. An additional credit card is not the same since the additional cardholder is not named as an account holder.
