How Many Credit Cards Should You Have?

How many and what type of credit cards should you have? The answer is not only different for each person, but it’s also likely to evolve—with finances, spending, knowledge and the credit offers available.

Is it good to have multiple credit cards?

Any benefit achieved with multiple credit cards ultimately depends on the cardholder and how financially responsible he or she is. According to Experian, Millennials have an average of 2.5 cards each, while Baby Boomers average 3.5.

Some prefer to live without a credit card as a means of avoiding temptation to spend money they don’t have. Others can do very well with a single card that pays cash back or maybe two cards—one for everyday spending and one for eating out or for traveling abroad.

Some people (*cough* our entire staff *cough*) make a hobby out of maximizing credit card rewards—particularly travel rewards. Travel rewards allow for nearly free flights and luxury hotel stays. There are many routes to take with credit card ownership, but it’s up to cardholders to decide how many credit cards they need or want.

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Ideally, how many credit cards should you have?

Ultimately the number of cards someone should have depends entirely on personal situation and financial history. Some remain fine with one (or even zero) and others can thrive with a handful.

But first, a necessary disclaimer: It’s important to pay off the full balance on every card every month. Having several cards is a lot of responsibility. Don’t collect more than one or two cards if it’s not possible to pay off every balance monthly, resist temptations to spend more just because more credit is extended.

It’s also important to open credit card accounts slowly over several years. Opening multiple card accounts in a short period of time can hurt a credit score or jeopardize larger financial goals like getting a low mortgage rate when buying a house. Closing card accounts can also hurt credit scores if it means the cardholder’s credit optimization rate will increase. Be selective when building a credit card portfolio.

Live Without a Credit Card

Before choosing to apply for any credit card, remember the option exists to not own one at all. Using only cash or a debit card associated with a checking account works well for 20% of American adults who don’t have any credit cards. It’s possible to survive and thrive without a credit card.

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Get a Single Cash Back Card

Starting out, we recommend a first credit card one that has no annual fee and pays cash back rewards on every purchase. For instance, the Discover it® Cash Back card offers 5% cash back on rotating categories for up to $1,500 in spending each quarter. Cardholders must enroll each quarter to earn the 5% cash back, but this provides a great opportunity to learn the ins and outs of credit card rewards. They can earn 1% cash back on all other purchases. Even if the credit line is not much to start, it may be enough to cover major expenses each month.

Cardholders may also consider a card that uses the Visa or MasterCard network, which are accepted by more retailers, especially abroad, than Discover. Top picks include the Citi® Double Cash Card, Chase Freedom Flex℠, Chase Freedom Unlimited® and Capital One Quicksilver Cash Rewards Credit Card.

Students applying for a first credit card who don’t have much income or credit history should read about the best student credit cards available.

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