When is the best time for a college student to give up a bank account or credit card tied to their parent’s bank account? It is a good idea for students to stand on their own, but the process of disentanglement can be gradual.

For credit cards, a college student should begin establishing credit in their own name as soon as they qualify for credit and can responsibly handle it. However, staying on a joint account longer may help build a stronger credit score. As the age of credit history has an effect on your credit score, closing an account could have a negative impact. Additionally, while tied to a parent’s account, you may have access to higher credit limits, making it easier to keep your utilization rate down.

For bank accounts, even once both parties are responsible with money, it may be advantageous for a parent to stay on the account. Here’s why. Suppose a student is unmarried and the parents remain the next of kin. Responsible adults (not just students) need to have contingency plans in case they get injured or fall ill. How would they pay their bills? By having another responsible adult on the bank account strictly for contingency purposes, that second adult (parent) could step in and assist the first adult (student or otherwise) by handling those day-to-day financial responsibilities through the troubled times without being cash out-of-pocket for the injured individual’s bills.

This works both ways if the parent is single. Assuming that we’re talking only about responsible adults, the question of who is on the bank account is more a matter of who would cover the primary adult account holder in an emergency.

If the adult is married, that’s generally the spouse. If the adult is unmarried and not in a healthy, responsible, committed relationship, that’s often a close family member like a parent.

So, parents might come off the bank account when the student gets married, even though the parents might stop using the bank account for deposits and withdrawals well before that.

Valrie Chambers, Ph.D., associate professor of taxation and accounting, and Betty Thorne, Ph.D., professor of statistics and the Christian R. Lindback Chair of Business Administration, write Financial Fridays to bolster students’ financial wellness including preventing financial mistakes, safeguarding their assets and identity, and thinking critically about financial decisions. For questions, contact Valrie Chambers at [email protected].