Number of Credit Cards and Credit Card Holders

The number of credit cards that's “too many” to handle differs from person to person. Too many credit cards for most people could be six or more, as the average American has a total of five credit cards, but it ultimately depends on how well you can manage one credit card, then two, and so on. Everyone should have at least one credit card for credit-building purposes, though, even if they don't use it to make purchases.

If you're not sure how many credit cards is too many for you, there are several factors you can think about when making your decision. In particular, consider your recent spending and payment history. If you're having trouble paying the full statement balance by the due date on each account you already have open, think twice about applying for another credit card account.

How to Determine How Many Credit Cards Is Too Many for You

1. Look at your credit report and score

If you have a history of financial mistakes, such as missed payments, you probably don't want to get more than one card until you prove yourself to be a responsible borrower. Besides, it may be hard to get more than one worthwhile card with damaged credit, anyway.

You can check your credit score and credit report for free right here on WalletHub. We'll also give you personalized tips for how to improve your score.

2. Review your utilization and payment history

If you're maxing out all the cards you have, credit card companies probably won't want to give you more spending power. Plus, credit card debt can be very expensive, and you don't want to rack up balances that exceed what you can repay comfortably.

3. Consider credit card company rules

Some issuers have unofficial rules regarding how many credit cards is too many for an applicant to have. For example, there are lots of rumors floating around that Chase will deny a credit card application if you've already opened five accounts (from any issuers) in the past 24 months. Such restrictions could limit your options for opening a new account or just serve as a sign that you might want to slow down the pace of your applications.

4. Determine how well you're keeping track of your credit cards

Even if your credit is good and you've never forgotten to pay a bill, that doesn't mean you never will. Having too many open accounts to keep track of can lead to forgotten due dates, interest charges from simply forgetting to pay a credit card in full, and other issues. If you have trouble listing your credit cards from memory, you're likely to forget to pay one at some point.

One other thing you should watch out for is applying for too many credit cards too quickly. It's best to not apply for more than one or two per year, as each application puts a hard inquiry on your credit report and temporarily hurts your credit score.

Benefits of Having Multiple Credit Card Accounts

You can get the best collection of rates and rewards for your biggest transactions.

For example, you could get a flat-rate cash back credit card for everyday expenses, a bonus rewards card for travel, and a balance transfer card to reduce the cost of existing debt. This can give you a better collection of terms than any single card is likely to provide. Just be sure to pay the bill in full every month when the regular APR is in effect, so costly interest charges don't wipe out any rewards you've earned.

Using multiple cards responsibly can raise your credit score.

Having several credit cards can boost your credit score by increasing the amount of positive information that gets added to your credit report each month, assuming you pay the bills on time and keep your credit utilization low. On that note, having more cards can decrease your overall utilization if you keep your spending the same.

Your payment history and the amount of credit you're using compared to your credit limit are two of the most important factors that go into calculating your credit score. A track record of consistent on-time payments and a low credit utilization ratio can result in better credit account terms in the future.

You'll have a backup if your primary credit card is lost or stolen.

The access to additional credit will come in handy, as it could take several days before you receive your replacement card.

Having too few credit cards carries other risks as well. For example, a limited payment history and a high credit utilization ratio can make it difficult to generate a strong credit score, which in turn could hinder your chances of getting approved for other credit accounts with favorable terms in the future.

Ultimately, the more data that's at your disposal, the easier it will be to decide how many credit cards you should have. WalletHub can help with free daily credit score updates and personalized credit-improvement advice.

You should only have one secured credit card to rebuild your credit initially, though you may want to consider eventually having two. It's not a good idea to apply for multiple credit cards at the same time because each application triggers a hard credit pull that negatively impacts your credit score. It's usually best to wait six months to a year between credit card applications.

Why One Secured Card Is Enough for Rebuilding Credit

One secured card...

You only need one credit card for good credit because simply having an open credit card account is the most efficient way to build and maintain a good (or even excellent) credit score. But the actual number of credit cards you have doesn't make up a huge part of your credit score – roughly 5%-10%. The more important factors are your payment history, the total amount of your debts, and the total of your credit limits.

...

You should have at least one credit card to build credit because using a credit card responsibly adds positive activity to your credit report each month, which will build your credit history. You don't even need to make purchases to benefit. Just having a credit card without carrying a balance can allow you to build credit without the risk of accruing unmanageable debt. 

As long as you have at least one credit card, the exact number of cards...

There are approximately 1,000 to 1,500 different consumer credit card options available in the U.S. There are different types of credit cards like store cards, rewards cards, travel cards, secured cards, and cards designed for specific credit levels (like bad, fair, or excellent credit).

These cards are on various networks such as Visa, Mastercard, American Express etc. The U.S. credit card market is substantial and it continues to grow at a rapid pace.

...

The average number of credit cards to have is about 3 credit cards per person, excluding store cards. However, there is no golden rule for how many credit cards you should have. Having credit cards for different purposes can help you maximize savings while increasing spending power, and it can also help improve your credit if you use the cards responsibly.

As you might expect, the average number of cards per person changes across different age groups....

It is bad to have a lot of credit cards if you cannot manage them all responsibly, as having too many cards can result in overspending, costly debt, missed payments and credit score damage. Even being unable to review each card's monthly statement is problematic since you could miss unauthorized purchases and signs of fraud.

On the other hand, having a lot of credit cards can be good for people who use different cards...

Yes, having too many credit cards can hurt your credit score. Having too many credit cards can lead to overspending and increase the risk of missed payments, which would lower your credit score, and applying for too many credit cards too quickly can also hurt your credit.

Additionally, when lenders see lots of open credit lines on your credit report, they may determine you to be a potential credit risk. This could hurt your...

It is okay to have 12 credit cards if you don't apply for them all at once and you're able to manage all of them responsibly. But if you find yourself overspending, racking up interest charges and missing payments, it's a good idea to cut back.

The ideal number of credit cards to have depends on each person's financial situation and preferences. The average person has around four credit cards, so 12 may be...