The Federal Reserve board has made it tougher for stay-at-home spouses to get their own credit cards.
If I go into Macy's and want to get a store credit card, so I can get 20% off a big purchase, I CAN'T DO IT. You know why? Because the Federal Reserve board says I have to get an okay from my husband who makes the lion share of the money around here. I need my husband permission to spend OUR money? Really? How old am I?
From Ann Carrns in the New York Times:
All this struck a nerve with me recently, because of a problem that arose with an account I hold with my husband. A few years back, he got a new credit card so he could rack up frequent-flier miles. Even though I was working full time and had my own set of plastic, he got a “companion” card for me, so we could pool our spending and earn miles faster. I’ve used it often, without thinking much about it.
Until last week, that is. I had a question about a statement fee and called the card company — only to be told that the assistant couldn’t discuss it with me without first obtaining my husband’s permission.
I was speechless. I began supporting myself financially in my early 20s. I have my own credit history and credit score. Yet, I was being told that I couldn’t be taken seriously without a say so from a man (albeit, one of whom I’m exceedingly fond). It felt like a scene from the “Mad Men” era.
When I insisted, the representative partly addressed my question, but said a full review would require spousal approval. For me, the incident provided a good laugh and an anecdote for a blog post. But for an at-home mom in, say, a deteriorating or possibly even abusive relationship, it could be devastating. Forcing such women to piggyback on a husband’s account means that she is still subject, to an uncomfortable degree, to his oversight — which strikes me as an unhealthy step backwards on the long, hard-fought road to gender equality.
This is utterly bullshit. My husband's salary is our joint property. It's joint property as soon as that check is cut on Friday. This credit card law not only puts me on par with my children in this house, it also robs me of control over my own money.
Apt. 11d 
You are absolutely right, but Ann Carrns’ example is weak. The same thing happens when I get the credit card and my husband is put down as a companion, which has happened. They still want to talk to me.
Meanwhile, when we were in Florida, we had to pay $29.95 a day extra (sprung on me at the reservation desk at 9 pm *after* Southwest had told me my luggage was lost–on my birthday) so that my husband could also drive the rental car (reservation was under my name). Last time I rent from Dollar, I can assure you.
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It’s joint property as soon as that check is cut on Friday.
Stupid direct deposit.
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A number of car rental places are charging extra to add any drivers, even a spouse. I think it might depend on whether state law prohibits it. We have to pay extra in Hawaii, with both Avis and Hertz.
Carns’ example is about privacy, and that’s different from how income is imputed. I recently found that I can’t access the rewards information on our joint bank account — though I have access to the account and, what’s more my husband doesn’t have complete access. I suspect there must be some new privacy issues they’re trying to fix.
Are we advocating for the old system where the marriage is one person, but that person is both people?
Have you tried to get a credit card at Macy’s, and is it really not possible? I’ve never known what the rules are.
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I don’t see the problem in Carrns’ complaint; the company wants to deal with the person who signed the contract. In this case it happens to be the guy but that is incidental.
On the other hand did I miss something concerning the Federal Reserve? I don’t see anything in the quote or your part that explains what they have done to make it hard on stay at home moms. My wife has been a stay at home mom for 12 years now and she’s never had a problem getting a store card without me. I don’t think she’s tried in the last year or so though.
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Ann Carrn’s example is terrible.
Our cable bill’s in my husband’s name. I pay the bill, but I can’t change the settings on the account–he has to do that.
A spouse in a deteriorating relationship is more likely to rack up debt on the spouse’s credit card. (http://www.lyricsdomain.com/2/blu_cantrell/hit_em_up_style.html)
See also: http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre08.shtm
Mary and Bill recently divorced. Their divorce decree stated that Bill would pay the balances on their three joint credit card accounts. Months later, after Bill neglected to pay off these accounts, all three creditors contacted Mary for payment. She referred them to the divorce decree, insisting that she was not responsible for the accounts. The creditors correctly stated that they were not parties to the decree and that Mary was still legally responsible for paying off the couple’s joint accounts. Mary later found out that the late payments appeared on her credit report.
To be very cold-blooded, the credit issuer only cares about being paid. Complaining that the person legally responsible for payment must be consulted about his own account is downright silly. Of course he must be! A convenience card does not make the spouse (or child) the account holder. (This person gives advice on money in the New York Times?)
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oh, and some companies offer a companion card that’s different than a “joint” card. we have one of these for my dad, so that he can pay for things for our kids. but I believe that he’s not responsible for paying it. His rights and obligations with that card are different from mine, though in both cases we’re not the primary account holder.
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So I stand corrected — it really is the new rule — apparently a new ruling by the federal reserve (as of march 18) of the credit act they passed in 2009.
I agree that there should be a spousal exemption from the rule. Folks should be lobbying their congressmen.
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Yes Dave — there’s been a new rule making about how household income will be treated.
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Cranberry — your acceptance of the idea might sound reasonable to me if both partners in a marriage had to agree to get a credit card. but the new rule making allows the income earning spouse to get. a card — will they then be singly responsible for paying the debt? At the very least, the lender will have access to marital property.
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Complaining that the person legally responsible for payment must be consulted about his own account is downright silly. Of course he must be!
Are you missing the point of the post or seriously arguing that there is no such thing as “household income??
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The lender would have access to marital property. It wouldn’t be possible, though, for the non-income earning spouse to be saddled with a deadbeat ex-spouse’s credit card debts. Now that I think about it, if I weren’t earning an income, I’d prefer a convenience card to a joint account. Yes, the joint account would give me a credit rating, but it would all depend on my spouse’s financial savvy. In the worst case in a joint account, I could end up paying for his stay in Vegas with his girlfriend (hypothetical case!!)
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Store credit cards charge stratospheric interest (that’s why they push those things so hard–it’s worth it to them), so getting cut off by Macy’s isn’t the worst thing that can happen to you.
The Mary and Bill divorce situation seems to come up a lot. A related problem is the mortgage issue. During a divorce, one spouse may do a quit claim deed removing them from ownership of property, while forgetting that they also need to be removed from the mortgage at the same time (for instance, through a refinance). As a result, they continue to bear responsibility for the unpaid mortgage, while having signed away control of the property the mortgage is attached to. From listening to Dave Ramsey, I get the feeling that some divorce lawyers just aren’t very good at crossing the ts and dotting the is with regard to resolving marital debt issues.
Having heard a lot of stories on the radio of spouses with hidden $20k or $30k credit card debt, I’d be very happy with an automated system that would text and email the spouse when new accounts are opened, etc.
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Yeah, I was going to say that a “companion” card is not the same as your own card or a “joint” card – that there is just one person on the account, the original account holder (I had one of these in college, on my dad’s credit card, and of course they wouldn’t have told me anything about the account, because the account wasn’t mine).
Your own account, and needing your spouse’s permission, is different, though, and complete bullshit.
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This smacks of 1960s era discrimination.
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Wish I had read this before the semester was over. Taught a Women and Public Policy course – it would have been great for discussion. Reminds me of coverture – are we really going back to that? I guess we haven’t come a long way baby.
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I sympathize with Laura, but a special rule for married people would be somewhat contrary to the current legal trend, which is to treat all relationships equally as no concern of the state. Of course, there could be a rule letting credit card issuers use their own judgment, but that would be contrary to the post-Dodd Frank trend of more regulation for everything(notwithstanding that wives running up credit card debt without their husband’s authorization was not exactly the cause of the financial crisis).
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“I sympathize with Laura, but a special rule for married people would be somewhat contrary to the current legal trend, which is to treat all relationships equally as no concern of the state.”
Examples? As far as I know there are no trends to treat married couples as not being financial units in a vast array of circumstances (though being in a community property state where it is complicated to assign debt and assets separately if they are acquired during a marriage might bias me).
If this is a veiled reference to affording married couples of the same sex the same rights as ones of the opposite sex, well, that’s not at all a trend to “treat all relationships equally.” Its a trend to treat all married couples similarly.
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Oh, and in a community property state, the non-earning spouse probably might be responsible for the debt incurred by the earning partner.
“One exception is community property states, where both are responsible, even for debt incurred by one partner.”
http://www.creditcards.com/credit-card-news/help/dividing-credit-card-debt-divorce-6000.php#ixzz1M62WWCG3
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“Oh, and in a community property state, the non-earning spouse probably might be responsible for the debt incurred by the earning partner.”
I think there’s a lot of fine print (which is why some people should get law degrees). Am I right in thinking that if Bob ran up a bunch of credit card debt and then died, his estate would be liable for his debts, but his widow Mary is not liable for the debt? (With the understanding that the home that belonged to both of them might have to be sold in order that Bob’s half of the house would pay off Bob’s credit card debt.) Very sticky.
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I was furious with our home lender, who put the mortgage in my husband’s name only. Thought we got things fixed, but when the mortgage was sold, I was denied access to the account and could not get questions answered, even though I am the one who handles most of the paperwork around here. I understand there are legal issues here, but the default-control-to-the-husband thing makes me nuts!!!
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bj: I’m not going to dig up a lot of policy papers from the various family law conferences and journals, but you can certainly read them at the local law library. A quick, well-known example of what I mean would be “palimony”: whereas once upon a time the courts would have drawn a bright line between married and unmarried cohabitants, now that line has been blurred. If people are allowed to get credit cards based on their spouse’s incomes, shouldn’t they also be allowed to get credit cards based on the income of their live-in partner?
As another example, recall that the New York Court of Appeals ruled that tenants could take over leases not only from deceased spouses, but also from live-in “intimate” partners. The court determined that it is the quality of the relationship, not its legal status, that matters. Shouldn’t the same analysis apply to credit decisions? Are you confident that the New York Court of Appeals wouldn’t order state-chartered banks to operate on that basis?
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