If you’ve ever compared credit card offers, you’ve probably seen statements such as “three free additional cardholders.” Or perhaps while you were reviewing the fine print of an offer, you learned that there was a fee for each additional cardholder on a credit card account. What exactly are additional cardholders though, and do they really concern you?

Let’s take a look at what additional cardholders are, and what they can mean for your credit card account and your credit history.

What are Additional Cardholders?

You probably already have at least a rough idea of what an additional cardholder is. After all, if you’re a cardholder when you get a credit card, and your credit card company allows “additional cardholders” on your account, it probably means you can have other authorized people using your account, each with their own card. And that’s the gist of it.

When you apply for a credit card, if you’re like most people you’ll apply alone. You intend to be the only person actually using your credit card. Well, some consumers prefer to add other people to their account — a student or a spouse perhaps. These additional cardholders each receive their own credit card to use, all tied to the same account and credit limit. How many additional cardholders you can have varies between different credit card providers.

Benefits and Drawbacks of Additional Cardholders

There are both good and bad elements of adding additional cardholders to your account. On the benefits side, you might be able to earn rewards faster if you and your partner are making purchases from the same account tied to a rewards credit card (like the CUA Rewards credit card which offers up to four free additional cards) than if you each used different accounts. It can also help simplify finances when there’s only one credit card account (or at least fewer accounts) for the household.

On the other side of the issue, additional cardholders have some downsides too. For example, it might add to your annual fee each time you add another cardholder. The annual fee often only covers you as the primary cardholder. For instance, the Citibank Clear Platinum credit card charges a regular annual fee for your first card, but also charges $19 annually for an additional card on your account (at the time of writing).

You also have to keep in mind that, as the primary cardholder, you’re financially responsible for all charges on the account — even if they are made by an additional cardholder. So it is incredibly important that you only authorise people on your account if you trust them completely. Otherwise you put your credit history at risk. There is also the added risk of someone else losing their card when there are multiple cards floating around which increases your chance of having cards stolen and used in credit card fraud.

It comes down to risks and cost versus convenience and rewards really. But then again, that’s what the decision to apply for a credit card often comes down to in the first place, isn’t it? Weigh the risks and rewards, and you’ll be able to make an informed decision about whether or not it’s the right time to add an additional cardholder to your credit card account.