Does Having Multiple Credit Cards Hurt or Help My Credit?

Credit cards are a staple of Americans’ wallets. The average adult has at least two bank-issued accounts, according to Experian’s 2016 State of Credit report. Consumer credit plays a key role in financial health, and, when used wisely, can strengthen your stance in the credit score range and help you secure loans with the best interest rates.

On the other hand, bad credit often leads to higher interest rates and could even disqualify you from the lending process. (Not sure where your finances stand? You can view two of your credit scores for free on Credit.com, which will not hurt them in any way.)

So how many credit cards are too many? And will having several accounts affect your credit? The answer to these questions often comes down to personal habits and goals, and there are several pros and cons to consider.

The Benefits of Multiple Credit Cards

If you’re an experienced and responsible credit user, the benefits of maintaining more than one card could outweigh the risks.

Earning Maximum Rewards

Credit card issuers offer a variety of perks for cardholders. Using multiple cards allows you to strategize and earn for every dollar you spend. For example, suppose you are a frequent flyer who is also interested in funding your child’s education. Card A is tailored to suit travel-related rewards, while Card B’s sole focus is college savings. You can take advantage of multiple benefits by considering your most frequent expenditures and choosing credit cards that align with your goals.

Safety When One Card Is Compromised

Credit card issuers are cracking down on identity theft, but chip technology still isn’t perfect. If your credit information is compromised, your issuer will probably send you a new card and instruct you to shred the old one. If this occurs, it’s useful to have a second option for emergencies.

The Drawbacks of Multiple Credit Cards

While there are potential benefits of maintaining multiple credit cards, there are a few drawbacks worth considering.

Losing Track of Spending

The case for fewer credit cards often comes down to simple math: Fewer credit cards means fewer chances to overspend. If you struggle with budgeting, it can be difficult to curb spending with a high credit limit. You also run the risk of digging yourself into a hole of debt that’s difficult to escape.

Forgetting to Pay a Bill

If your life is chaotic or your memory is lacking, the last thing you need is multiple account balances to keep track of. While it’s possible to create reminders for yourself with budgeting apps, the potential credit damage caused by late payments, fees and accruing interest may not be worth the trouble.

While there is no ideal number of credit cards to keep in your wallet, learning how your credit score is calculated can help you use them wisely. Bolster your score by creating deliberate spending habits and credit usage along the way.

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