Although there is no industry standard for how many credit cards you should own, there can be advantages to having more than one 澳洲幸运5开奖号码历史查询:credit card. Typically, two to three credit cards should be enough to ꦆestablish your credit history by demonstrating a track record of on-time payments and proper debt management.

Multiple credit cards can help your 澳洲幸运5开奖号码历史查询:credit score a♔s long as you don't max out the cards, meaning it's important to have credit availability on each card. However, owning too many credit cards can make your debt repayments unsustainable.

Although having multiple cards can help improve your credit, it's far more critical to make your payments on time and not overextend yourself by borrowing excessively. Discover the pros and cons of having multiple credit cards and the impact on your credit score.

Is It Good to Have Multiple Credit Cards?

Having multiple credit cards could allow you more spending power and more opportunity to earn points, miles, or 澳洲幸运5开奖号码历史查询:cash back if you use rewards cards. A recent Experian report shows that the average American now holds around four credit cards, which is down slightly from previous years.

Lowers Your Credit Utilization Ratio

The impact on your credit score can be a primary concern about having multiple credit cards. However, owning more than one credit card can 澳洲幸运5开奖号码历史查询:help your credit score and help lower your 澳洲幸运5开奖号码历史查询:credit utilization ratio.

For example, if you have one credit card with a $2,000 澳洲幸运5开奖号码历史查询:credit limit and charge an average of $1,800 a month to your card, then your credit utilization ratio—the amount of available credit you use—is 90%. Where credit scores are concerned, a high credit utilization ratio will 澳洲幸运5开奖号码历史查询:impair your credit score.

It may not seem fair—if you have just one card and pay it off in full and on time every month, why should you be penalized for using most of your credit limit? But that's how the credit scoring system works.

Monitor Your Credit Score

To improve your credit score, most credit experts recommend avoiding using more than 30% of your available credit per card at any given time. By spreading your $1,8🌠00 in purchases across several cards, it becomes much easier to keep your credit utilization ratio low.

This ratio is just one of the factors that the 澳洲幸运5开奖号码历史查询:FICO credit scoring model takes into account in the “amounts owed” component of your score, but this component makes up 30% of your credit score. Only your payment history is weighted more heavily (at 35%) when determining your credit score.

How Many Credit Cards Should You Have?

There is no magic number of cards you should have because everyone's situation is different. A strong argument can be made for having at least one credit card to take advantage of the inherent convenience, securit♍y, and other benefits.

Justifying having more than one credit card can depend on whether you need the extra credit lines to accommodate your monthly discretionary budget or seek to leverage your everyday spending to earn various types of rewards like cash back, 澳洲幸运5开奖号码历史查询:points, or airline miles.

Downsides of Too Many Credit Cards

Even having two credit cards can be one too many if you 澳洲幸运5开奖号码历史查询:can’t afford to pay your bills, don’t 🔯need them, or don’t plan to use them for soꦍme purpose.

While getting a new credit card can sometimes 澳洲幸运5开奖号码历史查询:improve your credit score by potentially lowering your total credit line utilization ratio, getting a lot of cards in a short period of time is not advised. Many card issuers even have rules in place to combat this phenomenon, whichꩲ has arisen with customers who try to game the system by signing up for lots of credit cards to earn bonuses and then cancel their cards after meeting the spending requirements.

For example, Chase has a policy termed 5/24, which doesn’t allow you to be approved if you have applied for more than five credit cards (regardless of the issuer) in the past 24 months.

Having multiple cards can mean accumulating multiple fees and interest charges. Premium cards often come with annual membership fees, and other cards may have 澳洲幸运5开奖号码历史查询:teaser introductory rates that shoot up after several months. Keeping track of these costs can be🔯come complicated, even with relatively small balances.

The Impact on Your Credit Score

Another potential downside of having a large number of cards is that it can make you look risky to lenders and 澳洲幸运5开奖号码历史查询:lower your credit score. Even if you have them all paid off, having many cards open with available credit lines can ♉be a potential liability to the next len🍌der.

So, while there is no absolute number that is considered too many, it’s best to only apply for and carry the cards you need and can justify using based o🍸n your credit score, ability to pay balances and rewards aspirations.

Tips on Managing Multiple Cards

Having an array of credit cards ca🌊n help you save money, but managing vario🐎us cards can be challenging.

Rewards Cards

Some credit cards pay you cash, credit, or discounts as a reward for beꩲing their customer. These cards might pay you a percentage of the purchase price. However, the rewards might be limited to a specific purchase category or time of the year.

For example, the Discover it Cash Back card offers 5% cash back in certain months. You can earn 5% back on purchases for groceries, hotels, restaurants, and gas—subject to a cap of $1,500 in combined spending per quarter. If you have another card that always pays you 2% back on gas, you can use it during the months of the year when Discover doesn't pay 5% cash back on gas.

You might also have a card that offers a flat 1% back on all purchases, which can serve as your primary card for when a higher reward isn’t available. For example, you might earn 5% on clothing purchases in October, November,🍒 and December with your Discover card, but you could use the 1% cash-back card for the rest oꦕf the year when a higher reward is unavailable.

Store Charge Cards

Store-branded credit cards are another consideration since you can only use them for purchases in a particular store or on their website. Opening a new store credit card o🌠ffering a significant discount on store purchases can be a huge benefit if you’re doing a lot of shopping in one store, such as back-to-school shopping, holiday shopping, or a major purchase like appliances for your home.

Paying the card off right away can help maximize the discount by avoiding interest charges. Of course, you don’t want to go overboard—if yꦬou have too many accounts, it’s easy to forget a bill payment or even lose a card. The problems resulting from such oversight will quickly ruin any savings you might have earned.

Compromised Cards

Sometimes, a credit card company will freeze or cancel your card out of the blue if they detect potentially 澳洲幸运5开奖号码历史查询:fraudulent activity or suspect that your accountꦍ number might have been compromised.

In a best-case scenario, you won’t be able to use your card until you contact the credit card company and confirm that your 澳洲幸运5开奖号码历史查询:card has not been stolen. However, that’s not a phone call you can make from the cash register because you may need to provide sensitive personal infor𝐆mation to confirm your identity. You may need another way to pay to complete your purchase.

In a worst-case scenario, the card company will issue you a new account number, and you’ll be without the 🔯card for a few days until you receive the new one in the mail. Another possibility is that you could lose a card or it gets stolen. To prepare, you might want to h🌺ave at least three cards: two that you carry with you and one that you store in a safe place at home. This way, you should always have at least one card that you can use.

If you opt for only one credit card, ensure you’re prepared with a backup 澳洲幸运5开奖号码历史查询:payment method, such as cash, a debit card, or a 澳洲幸运5开奖号码历史查询:prepaid debit card. However, check witꦇh the card issuer to determine if they chargeℱ fees or impose daily spending limits.

The Bottom Line

There are many benefits to having multiple credit cards, but only if you manage them responsibly. To ensure that having several credit card accounts will work for you, not against you, be aware of each card's benefits, your credit limit on each account, and the payment due dates.

Use each card to your best advantage, keep your balances low, and if possible, 澳洲幸运5开奖号码历史查询:pay your balances in full on or before the due dates. And, of course, remember to compare the best credit card options for your needs and credit profile before opening any new accounts♋.