Adding user to card may not matter

If you add your girlfriend as an authorized user on your credit card, the most that would be added to your girlfriend’s file is your history with that particular card. If the account was opened after your bankruptcy was discharged, and you’ve paid the bill on time while keeping your balances low, then the consequences shouldn’t be negative. But they might not be positive either, because of an upcoming change in the leading credit scoring formula.

Starting in September, the newest version of the FICO formula will ignore all authorized user information when computing scores. The company that created FICO, Fair Isaac, changed the formula after learning that some credit repair companies were “buying” authorized user slots on the credit cards of people with good scores and “renting” those slots to strangers with bad credit to quickly boost their scores.

Fair Isaac said it would introduce the formula next month at one of the three credit bureaus and roll it out at the other two bureaus over the next 12 months. The three bureaus — Equifax, Experian and TransUnion — sell FICO and other credit scores to lenders. You can still give your girlfriend the benefit of your credit card history by adding her as a joint user, if your issuer allows that.

Adding her as a joint user involves more risk for both of you because you will be jointly responsible for any balance on the card and she will have equal access to the account. An authorized user, by contrast, would not be responsible for any debt and wouldn’t necessarily be given his or her own card to use. Or you might simply help her find a card that can help her build her own credit history.

She might have to start with a secured card, which requires a cash deposit, but she should look for one that eventually converts to a regular credit card. She can find offers at Bankrate.com and CardRatings.com. A pro can help plan retirement My wife (51) and I (55) are nearing the payoff of the mortgage on our principal home and are wondering how best to invest the extra money until I retire in five years.

(My wife will keep working.) We both contribute the maximum to our 401(k)s and have no debts except a $60,000 low-rate mortgage on a second home. Our annual income is $275,000 so we’re looking to invest at least $5,000 per month. We’ll use the investment to supplement our retirement. Your best investment would probably be to hire an objective, competent, fee-only financial planner to review your investments and your financial plans for retirement.

You don’t say how much you’ve already saved, but you’re likely to need a substantial portfolio to get you through a retirement that could easily last 30 or more years. You’ll want to discuss the best ways to grow and to tap that portfolio.

If you’re not covered by your wife’s health plan, you also should discuss your options for health insurance because you won’t be covered by Medicare until you’re 65.