My wife has never been employed since we got married a few decades ago. If I were to die suddenly, we have enough equity built such that I think she could survive between that, medicare and social security.

That being said, she doesn't really have any individual credit history. She doesn't have a checking account in her name, nor credit cards. No utilities or bills in her name.

If I died suddenly, she may still need a loan here or their. Certainly credit cards. Perhaps a mortgage. So, I'm guessing, even if we have equity for her to survive, she still needs some credit.

At this point, what's the best way to build a credit rating and history for her? Could she get a credit card - would it be approved if she's not employed? Would I guarantee it? Or perhaps a secured credit card (how much would help build credit)? Should she get her own checking account or does that not matter? How about bills - should we put some utilities in her name?

Not sure what, if anything, we should do. Or will the lack of credit history not be an issue given equity possessed (house, other short / long term instruments)?

Any advice?

If you have an y credit cards in you name, but she is not a joint entity on the account you can add her, and that will bump her credit quite a bit as long as he is on your account jointly.

Understand, she can access credit, cash and other account features without your express permission, even if you do not present a card to such accounts.

(this may not be an issue if trust is not a concern).

Second, is a "secured" credit card, where a positive amount is put against the card.
($500 deposited, $500 limit on the card, so it is as if the card is "pre-paid/bonded) and as she charges, pays off charges, it builds credit.

Another is traditional "co-sign" for loan/credit and allow her to utilize/re-pay and build credit.

Putting utilities and any other financial instruments in "her name" and all payments go towards building credit.

Such things can build credit rapidly, if used properly, and then she can apply/obtain her own credit accounts and then continue to build credit score to a favorable number.

Bottom line, credit score is a sum total that "says" the person is a good candidate for "purchasing credit" and will make money for the credit industry. It really is not anything more than that.

"Good" credit customers are going to be given preferred treatment/rates because it puts money in the credit industries pocket.

(I speak from 50 years dealing with credit and figured it out after coming from a piss poor position in life and unable to get a dollar of credit, to making remarkable "recovery" after several set backs in life.)

Stated, that I had skin in the game and am a bit un-orthodox in navigating the river of life. But it is "real facts" not simply "what I think works", but what I have done/experienced.


Feel free to email and discuss specifics if you like.

I have a life of experience and information. If I keep it all to myself, it is just a burden to continue carrying with no further gain, If I "give it all away", I have lost none of it, but now another may carry and use that, and benefit, while reducing my "burden" of carrying it alone.

But I am not about to cast pearls to swine... (and be ridiculed, nor challenged for anyone's self serving agenda)

Make sense?

I started my credit history with a CapitalOne card. I did have a job at the time, but I believe they are one of the easiest ones to get for those with no history.

I only have 2 credit cards ever, and I'm nowhere near being well off, but I still have a score over 800. It can be done.

Department store and oil company (gasoline) cards can be one way. The Sears card (my very first ~40 years ago) is long defunct, but I think stores like JCPenney, Macy's and Dillard's still offer them. These have high interest, but interest is irrelevant if you pay at least the month's end statement balance off on time.

quote:

Originally posted by egregore:
Department store and oil company (gasoline) cards can be one way. The Sears card (my very first ~40 years ago) is long defunct...

Right before I graduated from college CITGO and Sears sent me offers which acknowledged that I would need to start building a credit history and offered cards with a modest ($300) starter credit limit which they'd give me just based on my saying "yes". I imagine it's different now.

Same with my wife, other than joint on some cards and mortgage. Her credit rating is in the 800s, she signed for our last car alone with zero issues or rate impact. Basically an experiment.

Likely not an issue as long as no BAD credit results.

A number of your accounts should be joint accounts in many cases unless there are some other considerations.
Just for probate considerations for example. Also vehicle titles and home documents. For example you get $250K capital gains exemption from your primary residence but that's $500K if it includes your wife. They also stay out of probate normally.
Other accounts that may be a liability may be better off in one name.
I would pay for consultation with an attorney or CPA for some guidance.

If you die suddenly, you think she could survive on equity? Are you saying equity in your home?

If this is the case, forget about her credit score. Where would the funds come from to pay back the borrowed money? This just seems like putting the cart before the horse. You need a better plan for her.

Thanks guys.

Sigmonkey: Thanks for your information and experience. I have credit cards accounts (visa, costco); she has cards as part of those accounts. Sounds like you're saying that will build credit history for her as well. If so, I didn't know that.

If that's the case, is there any benefit for credit history / credit score in getting a credit card solely in her name? Either regular credit card or secured credit card?

I'll look at putting some utilities in her name.

Yes. A card solely in her name and correct use will help.

(I put someone on a credit card account, they had a 5xx score, I had high 8xx, the score went up to mid 7xx in within 2 months, and they were able to obtain a credit card based on that and income. My score did not change)

Does she have any work skill and is she able to work now?

Not wanting to dig too deep, but others are correct in credit/scores are of little value if she does not have means to repay.

Working and managing finances is the "must have" base for understanding how to spend wisely and not overspend foolishly.

Even a limited income can be budgeted properly, but trying to live and operate of equity or credit is highwire act in a windstorm.

Your "new hobby" might be getting her established on her feet on firm ground.

Monkey wrote everything I would with the addition of one more thing I may have missed…

There are different kinds of credit available and acquiring them is important. Consider a collateralized/Securitized loan like on a car or the like.

(I’ve gone from negative to nada to exceptional love credit scores.)

Thanks again. This is very helpful.

We'll get a checking account and credit card solely in her name. We'll start with secured CC if necessary.

With SS and our equity, she should have enough to last well into her 90's - she's very frugal. But there may be times, for example, when a short term car loan (again, just for example) may be useful if the market is down (not ideal to withdraw from 401k). It's just leveraging equity to her advantage rather than insufficient funds.

She has much to learn, namely how to determine basis, gain/loss, and taxes. But wanted to build credit history score along the way - couldn't hurt.

Spending is wise. But no understanding about investing and taxes.

SM covered a lot of it. Just since no one mentioned it income does not go on your credit score and household income is enough for underwriting lines of credit.

quote:

SM covered a lot of it. Just since no one mentioned it income does not go on your credit score and household income is enough for underwriting lines of credit.

dumb question: how is household income determined? For example, is that the sum of husband and wife salary? So, if my wife applies for a cc solely in her name, she can put my salary as income?

Yes. They give option to exclude spouses wealth if wanted. They also don't verify income for CCs or store cards.

All sources of income ^^^ = yes+

How important?
Shortly after my father passed, my mother needed a new fridge. A local appliance store was having a sale/financing for senior citizens as long as their credit qualified them. Having been a stay at home mother/wife her entire life, she didn't end up qualifying. She had not CC or loans in her name.
The bastards were fine w/ selling her the fridge on the spot, picking up her old fridge, then telling her the next day her (lack of) credit didn't qualify for the sale.

I would suggest you confirm your belief that your wife has no credit history.

You can go to Annual Credit report.com to request your wife's credit report from one of the three credit reporting agencies. You can ask for all three if you want.

It's free. It's the same website I go to request a credit report from each agency alternating every 4 months for my wife and I. That way, I use my one free credit report from each agency every year but I space my request among each agency so I keep track throughout the whole year to review if anything is wonky.

You can ask for yourself too.

I think you will find that since you two are married to each other, your credit report is reflected on hers. I think this was the result of a law a long time ago that address the situation you described - all the credit history is on the husband and when he dies, the wife doesn't have one.

But I also make sure my wife has applied for credit cards on her own. She reports the household income when she applies for a credit card.

quote:

Originally posted by Rey HRH:...
I think you will find that since you two are married to each other, your credit report is reflected on hers. ...

Marriage status is not reported nor tracked by the three credit reporting agencies.

So, if she has no income reported, credit accounts, is not paying any reportable billing, and is not on any "joint" accounts reporting, she is not getting the benefit of "good credit habits".