This question is about Credit Cards
@WalletHub • 10/10/22 This answer was first published on 05/25/18 and it was last updated on 10/10/22.For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and
user-generated content is not provided, reviewed or endorsed by any company. Six or more credit card accounts might be too many for some people, given that the average American has a total of five credit cards. Everyone should have at least one credit card for credit-building purposes, even if they don’t use it to make purchases, but the exact number of cards you should have differs by person. It depends on how well you can manage one credit card, then two, and so on. If you’re not sure how many credit cards is too many for you, there are a number of factors you can think about when making your decision. In particular, consider your recent spending and
payment history. If you’re having trouble paying the full statement balance by the due date on each account you already have open, think twice about applying for another credit card account. If you have a history of financial mistakes, such as missed payments, you probably don’t want to get more than one card until you prove yourself to be a responsible
borrower. Besides, it may be hard to get more than one worthwhile cards with damaged credit, anyway. If you’re maxing out all the cards you have, credit card companies probably won’t want to give you more spending power. Plus, credit card debt can be very expensive, and you don’t want to rack up balances that exceed what you can repay comfortably. Some issuers have
unofficial rules regarding how many credit cards is too many for an applicant to have. For example, there are lots of rumors floating around that Chase will deny a credit card application if you’ve already opened five accounts (from any issuers) in the past 24 months. Such restrictions could limit your options for opening a new account, or just serve
as a sign that you might want to slow down the pace of your applications. Even if your credit is good and you’ve never forgotten to pay a bill, that doesn’t mean you never will. Having too many open accounts to keep track of can lead to forgotten due dates, interest charges from simply forgetting to pay a credit card in full, and other issues. If you have trouble listing your credit cards from memory, you’re
likely to forget to pay one at some point. There are benefits to having more than one credit card account. Having several credit cards can help you save money by allowing you to get the best collection of rates and rewards for your biggest transactions. For example, you could get a flat-rate cash back credit card for everyday expenses, a bonus rewards card for travel, and a balance transfer card to reduce the cost of existing debt. Having multiple cards can also help your credit
score if you keep your credit utilization low and your payments on time. What you should watch out for is applying for too many credit cards too quickly. It’s best to not apply for more than one or two
per year, as each application puts a hard inquiry on your credit report and temporarily hurts your credit score. The more data that’s at your disposal, the easier it will be to decide how many credit cards you should have. WalletHub can help with free daily credit score updates and personalized credit-improvement advice. WalletHub, Financial Company
How to Determine How Many Credit Cards Is Too Many For You
Look at your credit report and score.
Review your utilization and payment history.
Consider credit card company rules.
Determine how well you’re keeping track of your credit cards.
Dodger Bernard, Member
@dodger_bernard • 06/20/18 This answer was first published on 06/20/18. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
This question doesn't have a one-size-fits-all type of answer. It all depends on your debt-to-income ratio, your credit utilization rate, and how easy it is for you to manage credit cards.
Sallie Berger, Member
@sallie_berger • 06/15/18 This answer was first published on 06/15/18. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
It's all about your income. If you can afford monthly payments on all your credit cards, it means you've got enough. If you can't, it means you've got too many.
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People also ask
What happens if you don't use your credit card?
The short answer is that nothing is likely to happen if you don’t use your credit card for a few months. Not using your card could actually help your credit score if you have a $0 balance when you stop (contrary to some common myths about keeping a small credit card balance being beneficial).… read full answer
The longer answer is that exactly what happens if you don’t use your credit card depends on which card you have. Some rewards cards will revoke any unredeemed points, miles or cash back you have saved up if you don’t use your credit card at all for a certain period of time – usually around 12 months. And if you don’t use your credit card for 6 months or more, the issuer could close your account. But there’s no standard timeframe for when a credit card issuer will decide to close an account due to inactivity.
Having your account closed due to inactivity could hurt your credit standing and possibly make it seem like your credit history is shorter than it really is. However, you will not be charged any sort of inactivity fee by your credit card company if you don’t use your card to make purchases or other types of transactions for a prolonged period of time. Credit card inactivity fees are banned by law.
As a result, not using your credit card (at least not regularly) can be a great strategy if you want to build credit but are worried about overspending. You just have to make sure your balance is $0 when you stop using your card. A credit card with no balance will get reported to the credit bureaus as being in good standing each month, with an on-time payment and 0% credit utilization. That in turn will lead to credit score improvement if you manage the rest of your finances responsibly.
For your convenience, we’ll summarize the key points to remember below.
Here’s what happens if you don’t use your credit card:
- Nothing is likely to happen if you don’t use your credit card for a few months, as long as you make bill payments for any recurring monthly charges.
- The credit card’s issuer may decide to close your account after a long period of inactivity. There is no standard timeframe, but they will often send a notice in advance and give you a chance to use your card first.
- Some credit card rewards will expire after a certain period of account inactivity. You’ll also lose any rewards you’ve yet to redeem when your account is closed.
- If the credit card you’re not using has a $0 balance and is in good standing, positive information will be added to your credit reports each month the account stays open.
- Unpaid balances from before you stopped using the card will continue to accrue interest. If your balances have been paid in full, you won’t have to send in any new payments.
- If your credit card charges an annual fee, not using the card won’t get you out of having to pay. And if you’re not getting anything out of a card that you’re paying for, you might want to close it.
The bottom line is that not using your card can still be good for your credit. And it’s far better than using your card irresponsibly. So if you don’t trust yourself to limit your spending, it may be wise to set your card aside until you have a necessary expense.
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How often should you apply for a credit card?
It’s best to apply for a credit card about once per year, assuming you need or want a card in the first place. And you shouldn’t apply for more than one card at the same time. If you apply more often, the repeated hard inquiries into your credit history will hurt your credit score. Creditors will also see you as desperate to borrow, making you a greater risk and less likely to be approved for a loan or line of credit.… read full answer
Every time you apply for a credit card (with only a few exceptions), the issuer will do a hard pull of your credit, which temporarily lowers your credit score. Normally, this isn’t a big deal, because your score will bounce back after a few months of responsible credit use (e.g. paying on time, low utilization, etc.). But hard pulls become problematic when there’s a bunch at the same time. The damage is more significant and lasts longer – up to 12 months, according to TransUnion. And that can wind up costing you a lot of money if you need the best possible credit score in the near future, such as if you’re going to shop for a mortgage or car loan.
So careful planning is important, in terms of both which card you apply for and when you apply. If you’re rejected for a card, one option is to wait until your credit score rebounds before trying again. And you can track your credit score for free on WalletHub, the only site with free daily updates, to see when that happens. Alternatively, you could apply for a card with lower requirements.
For example, people with limited or damaged credit may want to consider a secured credit card. They require you to make a security deposit that acts as your credit line, and this collateral gives them the highest approval odds of all credit cards. As long as you can fund the deposit and make minimum payments, your chances are decent no matter what your credit score is.
If you’re not approved for a secured card, there are other ways to get your hands on credit. For instance, you can become an authorized user on someone else’s account or try to find a cosigner to apply with.
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Jeffery Surratt, Member
@jefferys_100 • 03/23/20 This answer was first published on 03/23/20. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
I have twenty credit cards with total credit lines of $70,000. I have income of just $37,104 per year. I have just $4,500 in CC balances on six zero interest cards. I have 770 to 800 credit score up from 560 - 36 months ago, as I paid down $28,000 in debt. I have not missed a CC payment in 13 years. I will have zero credit card debt in Dec 2020. I only use CCs for the rewards and will never pay a cent in interest. I love using the banks money for free with the zero interest deals. I even purchased 145 ounces of silver, 18 months ago, using a zero interest PayPal account. Never use a Credit card for a purchase that you cannot pay off in 6 months or less, no matter how many credit cards you have in your wallet.
Junior Clinton Walker, Member
@junior • 05/11/21 This answer was first published on 05/11/21. For the most current information about a financial product, you should always check and confirm accuracy with the offering financial institution. Editorial and user-generated content is not provided, reviewed or endorsed by any company.
The question could be answered with another question really. “Why is the credit card needed?” If your reply is ‘to build credit’ or ‘perks’ you're playing a dangerous game of financial chance, a game that is extraordinarily in the favor of the banking systems and loan institutions. Your fico score is comprised of 5 categories, all of which revolve around debt:
payment history (35%), amounts owed (30%), length of credit history (15%), new credit (10%), and credit mix (10%).
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WalletHub members have a wealth of knowledge to share, and we encourage everyone to do so while respecting our content guidelines. This question was posted by WalletHub. Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not a financial institution’s responsibility to ensure all posts and questions are answered.
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WalletHub Answers is a free service that helps consumers access financial information. Information on WalletHub Answers is provided “as is” and should not be considered financial, legal or investment advice. WalletHub is not a financial advisor, law firm, “lawyer referral service,” or a substitute for a financial advisor, attorney, or law firm. You may want to hire a professional before making any decision. WalletHub does not endorse any particular contributors and cannot guarantee the quality or reliability of any information posted. The helpfulness of a financial advisor's answer is not indicative of future advisor performance.
WalletHub members have a wealth of knowledge to share, and we encourage everyone to do so while respecting our content guidelines. This question was posted by WalletHub. Please keep in mind that editorial and user-generated content on this page is not reviewed or otherwise endorsed by any financial institution. In addition, it is not a financial institution’s responsibility to ensure all posts and questions are answered.
Ad Disclosure: Certain offers that appear on this site originate from paying advertisers, and this will be noted on an offer’s details page using the designation "Sponsored", where applicable. Advertising may impact how and where products appear on this site (including, for example, the order in which they appear). At WalletHub we try to present a wide array of offers, but our offers do not represent all financial services companies or products.