Some people have a dozen credit cards while others avoid having even one card in their wallet. There’s no one-size-fits-all when the number of credit cards is concerned. Make sure you weigh in the benefits and drawbacks to find the optimal number of cards for your financial needs.
The number of credit cards you should have depends on multiple factors, including your desire for rewards on purchases, the need for a higher credit limit and your responsibility and spending habits.
In general, you should start with one card to build your credit, especially if you have no credit history. Once you improve your credit score, you can apply for a second card.
How many credit cards should I have if I travel often?
In this case, you’ll likely need at least two credit cards — one travel card and one cashback card for rewards on everyday purchases, such as groceries, gas, dining and entertainment. If you often stay at a certain brand of hotels or if you travel primarily with one airline, consider adding a cobranded hotel or airline credit card for added value.
How many credit cards should I have if I have credit card debt?
Assuming you already have a credit card where you accrued your debt, you may want to consider another credit card that’s designed to help you pay down your debt. You could consider a card with a long 0% intro APR period on balance transfers. To get the longest intro APR period, you would have to forfeit earning any rewards with the card. If the 0% intro APR period isn’t long enough for you to pay off your debt, consider applying for another balance transfer card.
How many credit cards should I have if I want to make a large purchase?
If you’re renovating at home or if you want to buy some new and expensive electronics, consider at least one credit card with a long 0% intro APR period on purchases. This can help you make the purchase now and pay it off without interest for as long as 20 months. You can add a second card, for example, a cashback card, to earn rewards on other purchases you make.
How many credit cards should I have if I want to maximize rewards?
To maximize credit card rewards, you need as many credit cards as you can get. And you have to use each card where it earns the most points. For example, use cashback cards on everyday purchases, store cards for purchases at the store and travel cards when you travel.
In addition, look for cards with high signup bonuses. Depending on the card, you can sometimes earn a bonus worth more than $1,000 once you meet the spend requirements.
How many credit cards should I have if I want to build credit?
Starting off with one credit-building card and then adding a second credit-building card will help you improve your credit score faster. That’s because credit-building cards often come with a low credit limit of $200. Having two such cards will give you higher spending power without maxing out your cards.
Having at least two credit cards is a solid starting point — and preferably from different networks like Visa, Mastercard, Discover or American Express — because you never know when your card could be declined or blocked. This way, you’ll have a backup card right away.
When choosing an additional card, consider which features you need. You can expand your wallet with rewards on categories you spend most, you can get a 0% intro APR period or you can get special travel perks.
Benefits of having multiple credit cards
Having more than one credit card comes with the following benefits:
- Higher credit limit.
A high credit limit boosts your purchasing power and it can keep your overall credit utilization ratio low. This, in turn, helps build your credit score.
- Earn a variety of rewards.
If your first credit card comes with rewards on select categories — say groceries and gas — you can choose an additional card with rewards on dining and entertainment.
- The chance to earn multiple bonuses.
Most credit cards come with a signup bonus once you meet the spend requirements. Depending on the card, this can be from $100 up to $1,000 or more worth of rewards.
- Get travel perks.
Your first credit card could be a simple one with or without rewards. If you travel often, you can add a travel card and enjoy travel perks like free checked bags, priority boarding and airport lounge access.
- Save money on interest.
Suppose you made a large purchase on your first card and now you’re carrying a balance with a 25% APR. You can apply for a second card with a 0% intro APR period on balance transfers and move your outstanding balance. You can now pay it off without accruing interest.
Drawbacks of having multiple credit cards
Sometimes, having multiple credit cards could be more trouble than it’s worth. For example, if you:
- Pay high annual fees.
This by itself is fine as long as you consistently maximize your cards’ value. But if you’re not utilizing the cards enough, it could be not worth it.
- Find it hard to manage.
Having one or two cards shouldn’t be a problem. But if you have more than two cards and feel overwhelmed by having to track spending and paying balances, consider cutting down the cards you don’t need, or checking out tips on how to manage multiple cards.
- Tend to overspend.
If you have a hard time controlling your spending, consider limiting the number of credit cards to avoid spending more than you can afford.
- Apply for multiple cards in a short amount of time.
Despite the approval outcome, each credit card application makes a hard pull on your credit. This isn’t a big deal if it’s one or two cards, but multiple credit card applications can substantially lower your credit score. Instead, consider requesting prequalification before you apply.
Best credit card to complement your first
When you manage to improve your credit score and you’re ready to get a second credit card, you’ll find excellent credit card options that could bring additional value to your wallet.
These options include a card with 6% cash back at US supermarkets and US streaming services, a card with 2% cash back on all purchases and one of the best travel credit cards without an annual fee.
Whether you should have more than one credit card depends on your personal needs and financial situation. Having more credit cards comes with benefits like an increased credit limit and the potential to earn a variety of rewards. But if you can’t manage multiple cards it could be a liability.
If you decide to get another credit card, make sure to compare credit cards until you find the right one for your situation.