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How many credit cards should I have?

The answer depends on you. Read on to find out why.
Written by Ashlee Tilford, Contributor
Peter Dazeley / Getty

The number of credit cards to have is a personal decision that depends heavily on you, your financial situation, and how well you manage your credit. The decision also depends on your credit score -- and it can affect your credit score. Your credit score will impact many other aspects of your financial future, such as your ability to buy big ticket items like a car or to secure a mortgage on a home.

Whether you're considering increasing or decreasing your number of credit cards to build better credit (or to maximize rewards), we've got you covered. 

Is there a specific number of credit cards I should have?

There is not a magic number of credit cards every person should have. But there is a range that will benefit you the most, based on your income, debt levels, available credit, and other financial factors. 

According to a 2020 Experian study, the average American had 3.85 credit card accounts with a total average credit limit of $30,365. 

Generally speaking, the optimal number of credit cards is the number of cards that allows you to maximize benefits while not carrying a balance over from month to month. Experian reported that the average credit card balance in 2020 was $5,315. If that balance is carried over from month to month, the cardholder pays interest fees. That situation can quickly trap you with ongoing high-interest debt. 

A good rule of thumb is to never open more credit accounts than you can financially manage with your current income and budget. 

How many credit cards should I have to improve my credit score?

There is no denying that credit card usage and the number of credit cards you have affects your credit score. Credit cards can influence every factor used in FICO scoring. 

Let's talk about different scenarios and how the number of credit cards might impact your credit score. 

You have no credit and want to build it / you have poor credit and want to improve it

It can be tempting to dive in and try to open multiple accounts with the idea that this might improve your credit. In reality, however, opening too many accounts (or even attempting to) at once may backfire on your credit score. 

Start small with one card if you need to build or improve your credit score. If your score falls into the very poor category (300 to 579), you may need to open a secured credit card first, then later add another card once you've built your credit up enough to qualify. A secured credit card usually requires a deposit which acts as your credit limit. 

If your credit falls into the fair category (580 to 669), you may be able to get an unsecured card. But we still recommend starting with one card to improve your credit before adding more to the mix. 

Also: The best starter credit cards if you have no credit

You have excellent credit but want to maximize rewards

Excellent credit (800 or above) means a world of credit card opportunities is at your fingertips. If you're interested in maximizing rewards with good credit, that may mean getting more than one card. Perhaps one card is best for travel rewards, and another card is best for cashback, and you want to make the most of both.  

The best way to know how additional cards will affect your credit score is to use an interactive online credit score simulator like FICO's. Depending on how many cards you currently have, their balances, their credit limits, your payment history, and your debt, an additional credit card could improve or harm your credit. 

If an additional card negatively impacts your credit score, consider using your current card to maximize your rewards or switching to a different card that better matches your reward goals. 

You have a lot of debt

If you have a lot of debt, you'll need to be extra cautious before adding more credit cards to the mix. If your other debts are not on revolving accounts (like credit cards), adding a credit card or two may not negatively impact your credit. 

FICO and Vantage scores look at credit utilization as 30% of your overall credit score. That's how much you currently owe your revolving accounts divided by your available credit limit. If your other debts are things like a mortgage, car loan, or student loan, adding another credit card could benefit your credit utilization ratio as long as you don't carry balances on the card. 

If your other debts are revolving accounts like credit cards, adding more credit cards is unlikely to benefit your credit. Focus on paying those debts down, and once you do, leave the accounts open so your credit utilization rate can improve. 

You are struggling to make minimum credit card payments on time

If you already have a credit card and are struggling to make even the minimum payments on time, now is not the time to add additional cards. Even one late credit card payment can have a big impact on your credit score. Adding another card will only add to the temptation to add to your debt, which will make it even harder to make timely payments. 

Which credit cards are the best ones for me?

To determine the best cards for you, first identify your goals for the credit cards. Are you using them to build credit? Earn rewards? Front the money for bills in between paychecks? 

For credit building, look for cards that you may be eligible for at your current credit score, considering the pros and cons of each. 

Also: The best unsecured credit cards

For earning rewards, identify what type of rewards you're seeking, and then research the best cards for those rewards. For example, if you're interested in travel rewards, you can research things like the best credit cards for vacation rentals

For paying bills between paychecks, look for cards with the lowest interest rates. But stay diligent; do not carry balances and end up paying interest. This is just like spending future income you've not yet earned. 

Can I apply for more than one credit card at a time?

You can, but it's best to avoid multiple applications at one time. It can look poorly on your credit report. 

How many credit cards is too many?

The number of credit cards a person should have is unique to them and depends on their financial situation and limitations. 

Are secured credit cards better than unsecured credit cards?

For people with poor credit, secured cards can be a great place to start building or improving credit. They are not necessarily better or worse than unsecured cards, but they have more restrictions to make the risk lower to the credit card company. 

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