Dear Clever Credit,
I want to get a credit card that a family member will use. It’s for an elder, but I will pay for it. If you’ve ever dealt with helping a senior in the twilight of their life, you know there is the delicate balance between needing to give them the semblance of independence and needing some control or oversight because of scams and cognitive decline. Gift cards and joint checking accounts aren’t an option.
Theoretically, the card should only be used for groceries, gas and emergencies. I would like to get one that has spending caps. I would also like to get cash back and bonus rewards for certain categories. It would also be great if it allowed me to block certain categories of spending. I’m considering opening and then making them an authorized user on either the Citi Custom Cash® Card, Blue Cash Preferred® Card from American Express or Chase Ink Business Cash® Credit Card (I’m a small business owner). What do you recommend?Sincerely,
Putting A Lid On It
Dear Lid,
I totally get it. My mother gives my grandmother a weekly allowance to ensure she doesn’t overspend and put herself in debt at her age. Good on you for wanting to take care of your family member while giving them some semblance of independence.
Let’s take a look at consumer credit cards for a moment, putting aside the fact that you’re a small business owner for now.
I got in touch with American Express and Citi and found that American Express allows you to impose spending limits for authorized users on all of its consumer cards, while Citi only allows you to do so on the Costco Anywhere Visa® Card by Citi. So you might need to remove the Citi Custom Cash Card from your list of potentials.
Taking a closer look at the Blue Cash Preferred, it checks most of your boxes. You can also set an authorized limit as low as $200. It offers:
— 6% cash back at U.S. supermarkets on up to $6,000 per year (then 1% thereafter)
— 6% cash back on select U.S. streaming subscriptions
— 3% cash back at U.S. gas stations
— 3% cash back on transit (including taxis, ride-hailing, parking and more)
— 1% cash back on all other purchases (See Rates & Fees)
You can also earn as much as $250 in cash back after you spend $3,000 in eligible purchases on your new card within the first six months. However, after the first year annual fee of $0, the Blue Cash Preferred does come with an annual fee of $95.
Now, let’s pivot to the Ink Business Cash Credit Card. It offers:
— 5% cash back on the first $25,000 spent in combined purchases each account anniversary year at office supply stores and on internet, cable and phone services
— 2% cash back on the first $25,000 spent in combined purchases each account anniversary year at gas stations and restaurants
— 1% unlimited cash back on all other purchases
The Chase Ink Business offers a sign-up bonus totaling $750. You can earn $350 after you spend $3,000 on purchases in the first three months your account is open, plus an additional $400 when you spend $6,000 on purchases in the first six months after account opening. There’s also no annual fee. And since the Chase Ink Business is a business credit card, you can request an employee card for your family member and set spending limits that way.
Comparing just these two cards, I would recommend the Blue Cash Preferred. While the Ink Business offers stellar rewards for small business owners, it wouldn’t really serve you as a card specifically for your family member. The Blue Cash Preferred has a higher rewards rate in categories most important to you and offers rewards in other bonus categories like you wanted.
Hope this helps and good luck!
More from U.S. News
How Business Credit Cards Differ From Personal Cards
Authorized Users: The Pros and Cons
Clever Credit: I’m an Authorized User. Can I Initiate a Balance Transfer on My Partner’s Behalf?
Dear Clever Credit: I Take Care of an Elderly Family Member. Is There a Card That Restricts Spending for Authorized Users? originally appeared on usnews.com
