11 May, 2022

How Many Credit Cards Should You Have? - The Full Guide

How Many Credit Cards Should You Have? - The Full Guide
Written by: - Phil Baker

The land of credit can often be a very confusing place. There is a tricky balance between having enough credit and having too much credit, and it can be difficult to get it right. This is all because of the importance of your credit score

When it comes to applying for credit, in any form, one of the most important figures that will influence whether, or not, you are successful is your credit score. Your credit score is impacted by the financial decisions that you make in your lifetime, and whether, or not, you pay back credit agreements on time. 

However, in order to get your credit score to a healthy level, you have to utilize credit. One of the easiest ways to do this is to get a credit card. But how many credit cards should you have? Keep on reading to find out!

Also read: How To Apply For a PPP Loan 

empty wallet

Should You Have Multiple Credit Cards?

First things first, let’s take a look at whether, or not, you should have multiple credit cards. As we mentioned earlier, one of the best ways to build your credit score is to use a credit card. But, is using just one credit card enough?

Well, there is no correct answer to how many credit cards that you should have. However, it is generally accepted that the majority of Americans will have more than one credit card. A lot of people apply for multiple credit cards because they need to have multiple credit cards. But, this isn’t the only reason why you should consider applying for more than one credit card. 

According to Experian, having multiple credit cards can help build your credit score. If you apply for multiple credit cards at once, it can be damaging to your credit score due to the hard-checks that lenders run. However, taking multiple credit cards can decrease your credit utilization ratio as it will be spread across multiple credit cards. This in turn will improve your credit score. 

Also read: How you can Calculate Retained Earnings


How Many Credit Cards Should You Have?

So, taking out multiple credit cards can actually be beneficial for your credit score. But how many credit cards is the right amount? 

Well, as we said earlier, there is no correct figure for how many credit cards you should have. For this reason, it can be tricky to strike the correct balance between too many and not enough. The simple reason why there isn’t a correct figure is that the right amount of credit cards for you depends on your spending habits. 

Typically, the average American will take out around 4 credit cards. This is a good number if you are someone who utilizes the credit that these cards offer you. By having 4 credit cards, you can spread the credit across multiple accounts, instead of maxing out a single account. As we mentioned earlier, this will reduce your credit utilization ratio. 

If you do choose to open multiple credit accounts, you shouldn’t carry all the cards on your person at one time. For example, if you choose to take out 4 credit cards, you should carry two with you, and leave two at home. Ultimately, the main reason why you should take out multiple credit cards is to increase your options and prevent you from maxing out a card. 

Also read: Calculate Net Income

money in wallet

Benefits and Drawbacks of Having Multiple Credit Cards

Now that we have covered how many credit cards you should have, let’s take a look at the benefits and drawbacks of having multiple credit cards



Increase Your Available Credit

As we have said, the biggest benefit of having multiple credit cards is that it increases your available credit. Of course, you could just apply for a credit card that has a large allowance. But, this isn’t the best option. 

By applying for multiple credit cards, you can spread your spending across the cards, rather than maxing out a single credit card. This will look more favorable to lenders as your credit utilization ratio will be lowered, and this will be reflected in your credit report.


Credit Card Perks

As you probably already know, the majority of credit cards come with rewards and perks. These perks usually include things such as cashback, and points on certain purchases. The perks that you get from using a credit card is often one of the most appealing things about getting one.

If you take out multiple credit cards, then you will have access to multiple perks. This means that you can use different credit cards depending on what you are purchasing in order to get the best perks. With things such as cashback, this could mean that using your credit card actually makes you money. 




One of the biggest drawbacks of having multiple credit cards is temptation. In order to have multiple credit cards you have to be very disciplined. Especially if you want to receive the benefits of using multiple credit cards.

When you take out multiple credit cards, you will be allowed to borrow a lot of money. If you want the benefits of credit cards you must avoid maxing out all the cards. In short, you must resist temptation.  

Also read: What is Annual Income?  

credit card in hand

The Bottom Line

So, taking out multiple credit cards can be very beneficial if you are hoping to improve your credit score. By taking out multiple credit cards, you are spreading your credit usage across multiple accounts. This, in turn, reduces your credit utilization ratio, which will improve your credit score. 

But, ultimately, the biggest influence on your credit score will be your spending habits. In order to reap the benefits of using multiple credit cards, you have to be disciplined with your spending. If you max out all the credit cards, then this will not help improve your credit rating. 

However, if you are serious about taking out multiple credit cards, then there isn’t a correct number. But, the average American tends to have around 4 credit cards if they want to improve their credit score. So, this is a good number to aim for. 

Your check stubs can be used as part of tracking your finances. Use them along with your credit card statements so you can have a better understanding of incomings and outgoings.

Also read: How Is Net Worth Calculated?

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