In a world of instant gratification and reward, credit card companies play in a field ripe with opportunity. It’s no surprise the average consumer has between three and four credit cards each, when around every corner an offer presents itself to open a line of credit. Credit card companies go all out in enticing the consumer with cash back incentives, deep discounts, and valuable rewards points. For those individuals with great credit, the ability to rack up credit cards is even easier. But, what is the right number of credit cards to have? Is there even a right number? The answer completely depends on you.


Really, how many cards should I have? Depends on your goal …

The appropriate number of credit cards in one’s pocket has a great deal to do with personality and purpose. As more than half of the U.S population of credit card holders have maxed out at least one card, there’s good reason to take a step back and ask yourself what kind of consumer you are. You’ll need to know if you are the type of consumer who would be tempted to fill in the ample credit space between a zero balance and complete max out, or if you tend more towards keeping as low of a balance as you can.


Points & Rewards

If your goal is to chase those enticing rewards points, then more cards may be better, as long as you can effectively juggle the cards and maintain low balances on each, ideally keeping the balances below 30% on each. If you can achieve this and not be tempted to overspend, then there are a lot of deals to be had. Credit card companies are doing everything they can to attract your business, banking on the certainty that at least some percentage of those opening credit accounts with them will carry large balances.

Department Store Discounts

Credit cards for the larger stores you find yourself shopping at frequently may be a big help on your wallet, as most of these cards offer cash back after you spend a certain amount, or a small discount on every purchase. If you travel often, then cards that offer rewards points on flights or hotels can be of a great advantage to you. But for each of these cards, you never want to spend more than you can pay off each month.

Rebuild Credit

If your goal is to rebuild credit, then more cards aren’t going to help you(you may need credit repair). What’s most important is establishing credit history, i.e. how long you’ve had each line of credit, timely payments, and low balance to limit ratio. Chances are, if you’re rebuilding credit, the cards you’ll qualify for at first won’t be ones with the best terms. Once you’ve owned these long enough to see your credit score climb back up, you can negotiate different terms, or begin to open new cards. Keep in mind though, each time you apply for or open a new line of credit, you can experience up to a five point hit on your score.

Emergency Reserves

If your goal is to have a card in case of emergencies, then limit how many cards you designate for that purpose. Choose a card that has the best benefits, such as no annual fees and no penalties for minimal balances. As the goal is to never use an emergency card in the first place, work on putting a little amount each month into savings as an alternate emergency fund. So when the emergency comes up, you have a starting fund to help pay off the card quickly.


Credit Cards and Your Credit Score

Technically speaking, the actual number of cards you own has very little impact on your credit score – 10% of your total score is dependent on this number, and that’s in combination with other lines of credit. So 10% of your overall credit score is dependent on the the number of credit lines (revolving, mortgage, auto loan, student loan, etc.) you have.


Here’s the breakdown, according to Investopedia:

  • Payment history is 35% of your credit score
  • total debt owed is 30%
  • length of credit history is 15%
  • new credit taken on is 10%
  • type of credit used to include all types of credit is 10%

Given that your credit score is taking into account all forms of credit, extra credit cards may be a big help if you carry very low balances on them. The collective credit limits on those cards will help offset outstanding auto, personal, and student loan balances.

Closing Your Credit Cards

If you plan on playing the credit card shuffle to maximize points, just be aware of the open account vs. closed account factor. FICO will take your closed accounts into play when determining your credit history. But, a closed account also lowers your credit-to-debt ratio. If you have seven or eight cards already, this isn’t a problem. But, if you only have a few, you may want to give closing an account careful consideration.

The other thing to keep in mind about the credit card shuffle is the importance of remaining active on those cards. Many cards carry minimum spending requirements to avoid any penalties, and many of these companies will close your account for inactivity. Closed cards means lower debt-to-credit ratio.

In Closing

Ultimately, there is no wrong number when it comes to how many credit cards you choose to have in your wallet. Whether you choose to have cards for rewards, to build or repair credit, or for emergencies, just be honest with yourself before taking the plunge. Know what kind of spender you are, and do your homework on the best and worst deals you can find in the credit card world.

And remember, the more cards you have, the more accounts and bills you’ll need to keep track of, including being aware of spending minimums and annual fees. Knowing your options and how they affect your credit score will be the biggest help to you in making your decisions about how many cards to own.


What are your thoughts? How many cards to you juggle and why?

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