How Many Credit Cards Should I Have?

Last Updated: July 14, 2019
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Do you know how many credit cards are too many for you?There are several benefits of having a number of cards - but also risks to consider. What's the norm for Americans and is there a magic number? Here are all you need to know.

Do you know how many credit cards are too many for you? The truth is that there’s no way to know how many cards you should have. All we can do is give you some guidelines that will help you along the way.

When it comes to the cards that you do have and the credit limits that they have, you’re looking at an impact on your credit score and your ability to get loans and even rent an apartment.

What’s the Norm for Americans?

When it comes to most American’s, Experian says that most people have 3.1 credit cards on average, with an average of 2.5 retail cards. That shouldn’t be too surprising either, since retail cards are quite simple to get.

When it comes to different generations, however, the numbers are slightly different.

Silent Generation Baby Boomers Gen XGen YGen Z
Average Number Of Credit Cards3.03.53.22.51.4
Average Number Of Retail Cards2.32.72.62.01.5

When it comes to Baby Boomers you’ll see they have the highest average between all of the generations at 3.5 with Gen Z having the lowest average at 1.4.

It might seem like these are high numbers, but the Consumer Financial Protection Bureau says that people actually have less credit cards than they did before the recession occurred. In fact, about 169 million people were in possession of one or more cards by mid-2017. The number of cards that consumers have continues to increase for all but subprime lenders, the numbers are still lower.

Approximately 110 million new cards were actually opened in 2016, which was actually about 50% more than what was found in 2010 and was at least somewhat higher than every year since 2007.

Why Do You Want More Cards?

If you’re the type of person that pays off your balance entirely each and every month there are a few reasons that you might actually want to have multiple cards.

  • Specific Cards – You may want to get a rewards card, a dining card, a card without foreign transaction fees and more. If you’re good about using them and paying for them you’ll get great benefits, but you might have a hard time getting them in the first place. After all, they tend to require higher credit scores and then they return with high-interest rates.
  • Improve Your Credit – If you have several credit cards you can actually decrease your debt-to-credit utilization ratio because you’re going to have less debt and more available credit. At least, if you keep your ratio under 30% you’ll be able to do that. If you open new credit cards your credit continues to go up and your ratio continues to go down, but keep in mind that you shouldn’t be charging a lot on those cards.
  • Backup Plan – If something ever happens to the primary card that you use you’ll have another card available for you while you’re waiting to get the other card replaced.

Benefits of Less Cards

There are several benefits of having a number of cards but there are some things to consider as well.

  • Debt to Credit Utilization – If you add more debt each time you add new credit cards you’re going to increase the debt to credit utilization ratio that you have and that can mean you’re actually getting a big hit to your credit score.
  • Loan Abilities – If you keep opening up too many credit cards or if you already have too many open it could actually make you less likely to get approved when you need something more. After all, even if you have very low debt, having that credit available means that you could be too much of a risk.
  • Maintain On-Time Payments – If you have fewer credit cards you’re also going to have fewer payments to make, and that’s going to make a huge difference. If you have a lot of credit cards you could struggle just to make sure all the payments are made on time.
  • Keep a Handle on Spending – Having only a single credit card or a couple of credit cards means you have a lower chance of actually spending more than you should, contrary to having multiple credit cards.
  • Get into Debt Trouble – If you have too many credit cards you could easily find yourself in debt, and big debt. If you have fewer cards you’re going to have a chance of maxing it out, but you can only max out what you actually have available.

That Magic Number

Okay, so there actually isn’t a magic number, but you’re likely going to want at least a single credit card.

The most important thing is actually going to be your use of the card rather than anything else. You’ll also want to pay attention to your payment history and your credit utilization ratio. These things will make an even bigger impact on your score.New accounts can actually improve your score because you’ll have more credit available to you and that means the debt you have is going to be a lower percentage of the available credit.

For those who can, spending on each of your credit cards with a small amount is going to be better than having a lot of money on a single card, especially if you’re looking at your utilization rate. Just don’t forget that financial institutions generally look at credit utilization overall and with individual credit cards.

For those who are actually responsible with their cards and who are actually doing well with paying off balances, it’s possible to improve your payment history overall.

For those who spend more than what they actually earn it can result in debt that they just can’t pay back, especially if there are more credit lines available.If you make a late payment you could be in serious trouble, especially if you can’t keep track of your cards.

How Many Cards Do You Actually Need?

If you want to make sure you have the ‘right’ number of cards you’re going to want to look again, because there really isn’t anything specific.

What you should be paying attention to is how you spend money and what you’re really looking for.

For someone who shops a lot at grocery stores it’s possible to find cards with rewards and points back up to 6% cash back. For those who fly a lot it’s important to look at cards that have good airline mile returns. Those who stay at hotels may want cards that can offer hotel rewards. Those who are shopping all over may want a rate for just about everything they buy.

So, keep a closer eye on the specific rewards that you’re entitled to. Look at how department stores work as well. If you’re shopping most at a specific card you may actually be able to get rewards because of those partnerships.

Having a balanced card that you can use wherever you need to go is going to be extremely important. But how many cards you should have will depend on what you’re actually in need of, though you want to make sure you have at least one option to improve your score.

The Personal Needs

If you’re not sure what you really need you should take a look at the way you actually use your credit cards and then look at the chart below. That way, you can make sure you have the right results and that you’re going to have the right number of credit cards for you.

 

ProfileGoal 
Maximum Card Recommended
Considerations
Bad credit
Fair
Good-excellent
Seniors
Travelers
Shoppers
People in debt
Family’s Everyday Purchases
Small business owners

Down to the Wire

You’re going to need to look at a few important things to make sure you know the right number of credit cards for you.

  • Is your current debt under control?
  • What the balance you currently have? How about your credit score?
  • Are you a big spender? What about your self-control?

People that aren’t caught up in the middle of debt and who pay their balances every month can have as many credit cards as they want and won’t have to worry about having multiple cards. People who aren’t used to credit cards, however, or who got a bankruptcy or who have spent too much on their cards, secured cards might be best.

What you need to know most is that you’re going to put yourself on a system to hold yourself accountable, no matter what you’re doing.