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How Many Credit Cards Should You Have? What’s Too Many?

How Many Credit Cards Should I Have

There’s no golden rule for either the number of credit cards that you should ideally have or how many credit cards is actually too many. The average credit card user had 3.7 cards in 2014, according to Gallup, and CardHub’s editors believe that around four cards is indeed the number that provides the most benefit without making life overly-complex.

But it all ultimately depends on your comfort level, credit standing and organizational skills. The more cards you have, the more magnified your financial management flaws will become. Below, we’ll break down the pros and cons of having numerous active credit card accounts as well as how to choose your own ideal number of cards. We considered store credit cards and general-purpose credit cards to be equivalent for this purpose, as the same decision process will dictate whether or not you should open a new account.

Pros & Cons Of Opening A New Account


Pros Cons
  • Additional information will be reported to the major credit bureaus each month, providing the opportunity for faster credit improvement
  • Provides or supplements your emergency line of credit
  • Makes everyday spending more convenient
  • Gives you access to rewards and 0% financing, or enables you to implement the Island Approach
  • Helps lower your overall credit utilization ratio, assuming you already have at least one card
  • Allows you to selectively take advantage of attractive sign-up perks
  • Increases your potential to rack up unsustainable debt
  • Necessitates remembering another monthly due date, monitoring account activity, in addition to other time and organizational requirements
  • Temporary minor damage to your credit score, from having less disposable income and effectively shortening the overall length of your credit history – typically lasts for six months

If you’re trying to decide whether or not to close an existing credit card account, the inverse of the above pros and cons will be true.  If avoiding credit cards would force you to rely on cash and debit cards for your daily spending, you may also be more susceptible to pick-pockets as well as ATM fees, and you might miss out on secondary credit card benefits like rental car insurance, trip protection and extended product warranties.

You can learn more about the benefits and drawbacks of closing a credit card account in CardHub’s guide.

Wallet Scenarios: How To Handle Different Numbers of Cards

We recommend having at least two open credit card accounts in order to maximize credit building benefits and address evolving needs. With that being said, we recognize that people want more personalized advice, so we analyzed the value of 1, 2 and 3+ card scenarios in greater detail below.

1 Credit Card

Having a single credit card account is quite common, especially among people who are new to credit or working their way back from financial mistakes. Many people with more established credit opt for a single card as well, having closed their starter account and being content with the simplicity of one everyday spending vehicle.

With that being said, we definitely recommend getting a second card if you only have one – provided you’ve demonstrated the ability to use it responsibly. Having two cards, as you’ll see below, not only enables you to employ plastic more strategically in order to save money, but will also help you build a richer credit history.

2 Credit Cards

Having two credit cards is a great way to take advantage of the basic benefits of the Island Approach. If you don’t have any credit card debt, this might entail having a pair of rewards cards – one offering cash back across all purchases and another tied to your favorite retailer. On the other hand, if you have debt or are planning to incur some in the near future, you should use a 0% card for financing and a rewards card for everyday spending.

Adding a third credit card to your wallet enables you to get more aggressive with the Island Approach, perhaps getting rewards cards targeted to your three biggest monthly expenses (if you pay in full) or pairing a couple of rewards cards with a 0% offer.

3+ Open Accounts

If you already have three or more cards, there are valid arguments to be made for both opening a new one and also closing one old one after you do so. Having three or more cards enables you to strategically cobble together account terms that complement your financial needs as well as selectively take advantage of sign-up perks, like initial rewards bonuses and 0% intro rates. Of course, the more credit cards you have, the more your financial management shortcomings will be magnified.

So, it’s up to you whether to stick with three cards or expand your portfolio, as well as which cards you should keep open. The one thing you need to be careful about here is closing your oldest account, as doing so will shorten your credit history and thereby damage your credit score slightly.

Tips For Choosing The Right Number Of Credit Cards

One must consider a number of different factors when deciding on an appropriate number of active credit cards to have at a particular time. We’ll analyze the most important ones in the tips below.

  1. Expand As Your Credit Improves: The single most important factor dictating the number of credit cards you should, or even can, have is experience. Do you have established credit or are you just starting out?The more of a novice you are or the worse your credit is, the fewer options you will have and the more you will want to concentrate your efforts on responsibly managing a single account. If you have above-average credit, however, you’ll at least have the opportunity to selectively take advantage of different types of credit card offers in order to amass the best possible collection of card terms for your particular needs.

    If you’re not sure where your credit stands, you can check your score for free on WalletHub. WalletHub’s daily updates will also enable you to see how your rating reacts to each new card that you open or old card that you close. Depending on the results, our guides to building and fixing credit might come in handy, too.

  1. Prove You Can Manage One Card Perfectly: Whether or not you’re new to credit, it’s important to first master single card use before expanding your holdings. At a minimum, that should mean you haven’t missed any payments in the last 12 months and that you’re either debt-free or carrying a small, manageable balance. Otherwise, adding a new card to the mix will simply exacerbate your problems, increasing your costs and potential for credit score damage.
  1. Automating Payments Is Essential: Setting up automatic monthly payments from a bank account is the best possible way to mitigate the missed payment and debt potential posed by having more than one credit card. Just make sure to thoughtfully choose between the options for paying your entire bill, the required minimum or a custom amount. This will obviously depend on how much money you have in the bank, but we recommend paying in full whenever possible. Doing so is especially important for cards you don’t use regularly, as you could easily rack up months of finance charges on a small purchase you simply forget about.You can check out WalletHub’s Guide to ACH Payments for more information about automatically paying your credit card bills.
  1. Ask For A Higher Spending Limit: If your interest in a new credit card derives from a need for more spending power to meet spending obligations or the desire to decrease your credit utilization to improve your credit standing, you might first want to ask your current card issuer to simply increase your credit line. This would help accomplish your objectives without the additional hassle and risk associated with opening another account.You can find tips for asking for a credit limit increase in our How To Get A Higher Credit Limit Guide.
  1. Use Smartphone Apps For Organizational Purposes: Those who want to reap the benefits of having multiple credit cards but are concerned about the organizational demands of such an arsenal should look into expense tracking apps like Mint that aggregate information across your accounts, notify you about upcoming payments and more. 
  1. Don’t Apply For New Cards Within Six Months Of Loan Applications: Each time you apply for a new credit card, your credit score declines temporarily – usually lasting around six months. This is intended to indicate to potential lenders that you are looking for additional spending power, which means your available credit might not be as available as it seems.  And since you obviously want the best possible credit score when you’re applying for a mortgage or an auto loan, for example, you’ll then want to avoid opening a new card in the months preceding an application.
  1. Be Careful About Closing Old Accounts:  The length of your credit history comprises 15% of your overall credit score. Closing your oldest accounts, even if you don’t use them anymore, will therefore effectively shorten your documented credit career and potentially lower your score as a result.You can learn more about this topic in our Guide to Cancelling Credit Cards.


Image: radmilla75 / Shutterstock

Editorial Disclaimer: Editorial content is not provided or commissioned by financial institutions. Opinions expressed here are the author’s alone and have not been approved or otherwise endorsed by any financial institution, including those that are CardHub advertising partners. Our content is intended for general educational purposes and should not be relied upon as the sole basis for managing your finances. Furthermore, the materials on this website do not constitute legal advice and should not be relied upon as such. Please let us know if you have any questions or suggestions.

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