Tips and Ways to Managing Multiple Credit Cards (2024)

FAQs

What is the best strategy for multiple credit cards? ›

Several factors can make a good card combination, but most simply, a good pair is one in which both cards earn the same rewards but have different bonus categories. This way, you'll be able to maximize your earnings across a wider range of purchases than you would with just one card.

Use a system to keep track of your cards and use specific cards for assigned purposes, such as for dining out and groceries. Keep up with card payments by aligning payment dates or by using autopay. If you can manage multiple cards successfully — including on-time payments — you might see a boost to your credit score.

By diversifying your credit card portfolio, you can take advantage of the wide range of perks and rewards available on your cards. Some cards offer cashback on specific categories like groceries or gas, some provide extended warranties on purchases, while others come with special discounts or experiences.

According to cardholder reports, Bank of America uses a 2/3/4 rule: You can only be approved for two new cards within a 30-day period, three cards within a 12-month period and four cards within a 24-month period.

Always Make Payments on Time

One of the most essential rules to owning a credit card is paying bills on time. A single late payment within a year of on-time payments might not seem to be much, but it could be a slippery slope that leads to debt and low credit scores and it will impact your credit.

Owning more than two or three credit cards can become unmanageable for many people. However, your credit needs and financial situation are unique, so there's no hard and fast rule about how many credit cards are too many. The important thing is to make sure that you use your credit cards responsibly.

When you have more than one credit card, you take on more risk: You need to understand the different terms of service and keep track of multiple bills and due dates. And depending on how you manage important factors of your credit cards, like paying bills or carrying a balance, you can raise or lower your credit score.

Interest Rates: Compare the interest rates on both credit cards. If one card has a significantly higher interest rate, it may be more beneficial to focus on paying off that card first. By eliminating the high-interest debt, you can save money on interest payments in the long run.

In order to manage multiple credit cards successfully, it is also important to keep a constant check on the bill payment due dates. Each bank assigns a different and specific date of the month to generate your credit card bill. If you own two credit cards from the same bank, the due date for bill payment is the same.

Is it smart to have two credit cards from the same bank? If there is a second card from the same bank that complements the rewards or perks you're missing in your first card, it may be wise to go ahead and stick with the same company. You may be able to pair the two cards together to boost the potential rewards.

Is 7 credit cards too many? ›

Too many credit cards for most people could be six or more, given that the average American has a total of five credit cards. Everyone should have at least one credit card for credit-building purposes, even if they don't use it to make purchases, but the exact number of cards you should have differs by person.

If you pay off all your credit card accounts (not just the one you're canceling) to $0 before canceling your card, you can avoid a decrease in your credit score. Typically, leaving your credit card accounts open is the best option, even if you're not using them.

Ulzheimer explains that having multiple credit cards can help expand your buying power and gives you a lower balance-to-limit ratio, which helps your credit score. However, “the primary con is you can get yourself into a ton of really expensive debt if you're not responsible.”

“The possible advantages of spreading credit card debt across cards include creating a higher total of available credit, lowering total card utilization, and increasing the number of active cards, which could be seen as good credit management practice.”

If you have multiple cards with the same issuer, you can maximize your rewards by using different cards for different purchases -- then combine for redemptions. You might be able to transfer credit limits, and having multiple cards with one issuer will make it much easier to manage your bills.

You'll receive a hard inquiry on your credit report for every card application you submit, with each inquiry temporarily decreasing your FICO scores by around five points. Accumulate too many inquiries all at once and you could be looking at a larger blow to your credit score than you would expect.

Yes, assuming you use your cards responsibly. If you do, then having additional cards will generate consistent spending information for the credit bureaus each month, increasing your total credit limit and keeping your credit utilization rate low.