Do I Have Too Many Credit Cards?


When you are looking at ways to improve your credit score you may look at your cards and think cutting them down is the best way to go. But how many credit cards should you really have?

How many cards is too many cards? This question is one that has plagued financial experts because really, there is no right answer. Quantity itself is rarely a variable that can seriously damage a credit score. With that being said those with high scores and solid financial histories tend to be the benchmark to evaluate your own credit.

How Many Credit Cards Should I Have?

Having too many credit cards, as well as too few can impact your credit. If you have too few it doesn't show diversity of debt and also can come with a higher than ideal credit utilization ratio because of more concentrated use on only one or two cards.

Likewise too many cards can impact your score with repeated hard inquiries over a short period of time as well as the increased likelihood you will miss payments due to the many varying due dates and minimum payments.

According to credit bureau FICO their most successful customers, those with high scores, have an average of 7 credit cards on their record, including closed accounts. You don't necessarily need to have exactly seven cards on your record but this shows that many people are financially stable with more than one or two cards, which should make a lot of people breathe easier.

What About Retail Store Cards?

If you have a habit of opening retail store cards as a way to save then you may want to cut back. According to Experian the average American has 2.5 store credit cards. Unlike major credit cards retail store cards tend to be less of a risk with low balances and limits on where can shop and what you can buy with it. If you like these kind of cards just be mindful and make sure you are making payments on time and utilizing only 30 percent of your balance at the most. Also try to apply sparingly - the more credit cards opened in a short period of time the more suspect your credit report will look.

What Should I Do?

If you think you have too many cards simply stop using a few of them. Don't close the accounts, just cut up the card and pay the balance off completely. You can't erase a card from your credit report even after it is closed so the most important thing to do is just consolidate your spending to a handful of cards you get good use out of and focus on using them wisely.

We're here to help you rebuild and understand your credit. Give us a call to get started or learn more about what we can do for you 1-800-431-0449.