There are many reasons to have multiple credit cards. Having a backup card can be useful in case your primary credit card becomes lost or stolen. An additional credit line can be handy if you face unexpected or emergency expenses, like medical bills or car repairs. Splitting large costs across multiple credit cards can also keep your balance low on each card — which can positively impact on your credit score.
But while there are advantages to owning a variety of cards, beware that there are also several disadvantages if you’re unable to manage the cards responsibly.
Ultimately, the right number of credit cards depends on your financial and lifestyle needs. For example, if you’re just starting out on your credit journey, it may be best to begin with just one credit-building card, like a secured credit card. Once you’ve demonstrated that you can manage one card responsibly, you can graduate to an unsecured card and potentially add a rewards credit card to the mix.
But if you already have good to excellent credit, having two or three cards that offer rewards in the categories you spend the most in each month and provide additional perks and protections may be optimal.
According to Experian, the average American has 3.9 active credit card accounts. But that amount tends to be higher for consumers ages 43 to 77 and residents of more populated states.
Having more than one credit card can offer the following benefits:
While managing two or more credit cards may be easy for some, it can be a challenging task for others. With multiple credit cards comes multiple payment due dates, requiring you to keep a close eye on credit card activity across a number of platforms. In addition to monitoring your accounts, it’s important to monitor spending — since having more credit can make extra spending extremely tempting.
Also, keep in mind that owning numerous credit cards could mean owing multiple annual fees each year. So when choosing which new credit cards to add to your wallet, you may want to consider credit cards that have $0 annual fees.
While you can apply for a credit card as often as you like, an issuer may deny your application if you apply for too many credit cards within a specific time period. Some issuers may enforce the following rules:
Applying for many credit cards in a short period of time can signal to lenders that you’re a high-risk consumer — which can lead to your credit card application being denied.
When you apply for a new credit card, your credit score can be negatively impacted due to the following:
Hard inquiries on your credit report
Each time you apply for a credit card, a hard inquiry appears on your credit report. This lowers your credit score by a few points every time it occurs and stays on your credit report for two years (although the negative impact lessens over time).
Decrease in the age of your accounts
Opening a new credit card can hurt your credit score by decreasing the average age of your accounts. The length of your credit history accounts for 15% of your credit score, so having a longer credit history can reflect positively on your credit score. When opening a new credit card, leaving old accounts open and active can also help with the age of your accounts.
When it comes to building credit, there isn’t an exact number of credit cards you should have. However, having at least a couple of accounts can help keep your credit utilization low. What’s most important, though, is how you manage your credit cards, rather than the number of credit cards you have. Here are some ways you can use a credit card responsibly to help build your credit profile:
Pay on time
Making payments on time can help boost your credit score, although this can be more challenging to manage across several credit card platforms. A good tip is to contact your credit card company to make payment due dates the same for each of your credit cards when possible and set up alert reminders and autopay to avoid missed payments.
Keep your credit utilization low
Having multiple credit cards can help increase your credit utilization ratio, which is the total amount of debt you currently owe divided by the amount of credit you have available. This ratio makes up 30% of your credit score. Opening another credit card can help you to decrease this number since it will increase the amount of credit you have available. Experts recommend that you keep your credit utilization ratio below 30%.
Choose the right mix of accounts
Your credit mix is the combination of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans you have. This makes up 10% of your overall credit score. Having a diverse range of credit accounts can help improve your credit score by demonstrating your ability to manage a diverse range of financial accounts.
While having a variety of credit cards can help maximize your rewards, provide interest-free financing and give you access to useful perks, the best credit cards for you depend on your needs. Here are a few types of credit cards to consider:
Cash back credit cards are valued for their simplicity and flexibility, as well as their ability to earn anywhere from 1% to 8% on everyday purchases. For example, the Capital One Savor Cash Rewards Credit Card, which is our pick for the best cash back credit card, lets cardholders earn 3% Cash Back at grocery stores (excluding superstores like Walmart® and Target®), on dining, entertainment and popular streaming services, 5% Cash Back on hotels and rental cars booked through Capital One Travel (terms apply), 8% Cash Back on Capital One Entertainment purchases, 1% Cash Back on all other purchases.
If you eat out on a regular basis, a card that offers accelerated rewards at restaurants could be a good fit. For example, the Chase Sapphire Preferred® Card, which is our pick for the best credit card for restaurants and dining, lets you enjoy benefits such as 5x on travel purchased through Chase Travel℠, 3x on dining, select streaming services and online groceries, 2x on all other travel purchases, 1x on all other purchases, $50 Annual Chase Travel Hotel Credit, plus more.
A gas rewards credit card may be a good option if you’re looking to offset what you spend at the pump, since these credit cards can offer rewards or discounts on gas purchases. For example, the Citi Custom Cash® Card lets you earn a generous cash back rate in your top spending category each month (on the first $500) from a list of eligible categories, including gas.
Emergency expenses, like car repairs or unexpected medical bills, can happen at any time. Having an emergency credit card on hand to help cover these expenses, like the Chase Freedom Flex℠, is a good option due to its long intro APR, cash back rewards program and $0 annual fee.
If you have a big purchase coming up that you want to pay off overtime, a credit card that offers a 0% introductory APR for an extended period of time can be helpful, since you won’t be charged interest during the intro period. The Wells Fargo Reflect® Card, for example, has a 0% intro APR for 21 months from account opening on purchases. After that, a 17.24%, 23.74%, or 28.99% Variable APR applies.
If you have a large amount of high-interest credit card debt, a balance transfer credit card with a 0% introductory APR for a year or longer can help you save on interest charges while paying down your balance faster. The Citi® Diamond Preferred® Card, for example, offers a 0% intro APR for 21 months on Balance Transfers. Once the introductory period ends, an ongoing APR of 17.24% - 27.99% (Variable) will apply.
If you’re a frequent traveler, a travel credit card can provide rewards on travel purchases as well as valuable travel benefits and protections. The Capital One Venture X Rewards Credit Card, for example, offers an annual travel credit, anniversary bonus, lounge access, up to a $120 credit for Global Entry or TSA PreCheck and more.
Many credit card issuers will approve you for a second credit card as long as you meet the eligibility requirements.
You can get a second credit card with bad credit; however, the odds of getting approved are lower. You may also receive higher interest rates and less desirable terms if you do qualify for a second credit card. It can be best to take steps to improve credit before applying for a second credit card.
You can apply for multiple credit cards at the same time. But waiting between applications will give you a better chance at approval. Issuers are more likely to deny your application if you have applied for several credit cards at the same time.
You can check your credit score with any of the three major credit bureaus: Equifax, Experian and TransUnion. Many banks, credit card issuers and other companies also provide free online tools, like LendingTree Spring, that allow you to check your credit score.
You should generally avoid closing old credit card accounts. Keeping older cards open and active will boost your credit score by helping your credit utilization and length of credit history. You may decide to close an old credit card if it carries a high annual fee. But, you can also ask your credit card company if you can convert your card to a no-fee card in order to prevent your credit score from decreasing.
First, be sure you’re paying each of your credit cards on time and in full by keeping a reminder of when payments are due or setting up autopay. Next, check the terms and conditions of your credit card, and reconsider any with high annual fees. You should also keep track of the credit limit you have available on each credit card. Finally, select credit cards that align best with your current financial needs and decide what you plan to use each card for.
For Capital One products listed on this page, some of the benefits may be provided by Visa® or Mastercard® and may vary by product. See the respective Guide to Benefits for details, as terms and exclusions apply
The information related to the Chase Freedom Flex℠, Wells Fargo Reflect® Card, Citi® Diamond Preferred® Card and American Express® Gold Card has been independently collected by LendingTree and has not been reviewed or provided by the issuer of this card prior to publication. Terms apply.
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