How Many Credit Cards Should You Have?

6 Min Read | Last updated: February 16, 2024

A man seated at a table, using his phone and a credit card, possibly researching how to dispute his credit report.

This article contains general information and is not intended to provide information that is specific to American Express products and services. Similar products and services offered by different companies will have different features and you should always read about product details before acquiring any financial product.

The ideal number of credit cards to have depends on your specific financial situation. Explore the impact of having multiple credit cards here.

At-A-Glance

  • How many credit cards a person should have depends on their habits and lifestyle, how they spend money, and what kinds of benefits they value.
  • On average, Americans have either 3 or 4 credit cards.
  • Having a lot of credit cards won’t hurt your credit score if you’re using them responsibly, so it’s possible to build a portfolio of cards that offers a variety of benefits.

How many credit cards you should have depends a lot on the person asking the question. Many people benefit from having some credit cards. A few may want a lot of credit cards, while others may prefer to have one or none. In other words, the answer varies.

 

So how many credits cards should you have? Let’s find out...

How Do Credit Cards Impact Your Credit Score?

When thinking about how many credit cards to have, it’s important to consider the impact this choice may have on your life. The choice to have one, some, or no credit card affects your day-to-day finances and future ability to get credit.

 

In particular, credit cards impact your credit score through payment history, the amount of money you owe, credit utilization, average age of credit accounts, and credit mix.1

 

Credit Utilization

Your credit utilization ratio is the amount of credit you’ve used divided by your total available credit.2 For your FICO credit score, the amounts owed on all of your credit card accounts for around 30% of your credit score.2 Some experts recommend using less than 30% of your available credit, but others recommend between 1% and 10%.3,4

 

Multiple credit cards may positively impact your credit utilization ratio by increasing your overall available credit. However, having high balances on multiple cards could hurt your credit score and can make it difficult to lower your credit utilization ratio.

 

Average Age of Credit Accounts

The age of your credit accounts, including the average age of your accounts, has an impact on your credit score.5 FICO reports it as accounting for about 15% of a person’s credit score.5 In general, the more there is to your credit history, the better your credit score can be.5

 

Deciding to open new credit cards or to close existing accounts can alter the average age of your credit accounts. This also impacts your credit score, so the decision to open or close an account should include this factor.

 

Credit Mix

Credit scores also consider the types of credit you’ve sought.6 The more variety–credit cards, auto loans, mortgages–the better your credit score can be.6 FICO weighs your credit mix at about 10% of your credit score.6

 

Depending on your credit, opening a new credit card or closing an existing one could impact your credit mix. If you don’t have any credit cards, a new card may help improve your credit score.

Benefits of Having One Credit Card

If you can handle credit responsibly but you find keeping track of spending to be a challenge, one credit card might be perfect for you. With a single credit card, there’s only one payment to keep track of, no card accounts to confuse, one bank relationship to manage, and one place to go for all your credit card spending data.

 

After you have efficiently managed to own one credit card, you might find reasons to acquire another. If you get a second credit card with the same card issuer or bank as the first one, you may be able to retain some of the advantages of having a single card, such as having all bill-payment and statement data in one online account.

Benefits of Having Multiple Credit Cards

On average, Americans have three or four credit cards.7 If you can successfully juggle payments and expenses between two to five payment products without losing track of your spending, adding a few credit cards to your portfolio might have advantages. For example:

 

  • Redundancy: If your primary credit card gets lost, compromised, or otherwise rendered temporarily unusable, it may be helpful to have a backup to use while waiting for a replacement.
  • Building credit: As mentioned above, credit cards can play an important role in building credit. Having more available credit can be an effective way to reduce your credit utilization ratio.6 Plus, having credit card accounts for a while and having a credit card to diversify your credit profile can be helpful too.5,6
  • Extra benefits: Credit cards often come with different benefits and rewards.8 You may find that your favorite, everyday credit card has foreign transaction fees, so you use a different card when traveling abroad. You might use one credit card for the rewards it earns from grocery shopping, while another card provides useful travel perks.
  • Maximizing rewards: If you want to maximize your return on spending, a few cards with different bonus categories can be part of your strategy to earn more rewards. For example, you might have a cash back card with an unlimited 2% cash back rate, plus another one that earns 5% back on rotating bonus categories. Similarly, some credit card issuers have their own rewards currencies (credit card programs, airline programs, hotel programs, etc.). Having multiple cards that all earn the same currency, at different rates on different types of purchases, can help you accumulate rewards faster without increasing your spending.

Given all the potential advantages of obtaining extra credit cards, you might be asking, “If a few is good, wouldn’t a lot be better?” Having multiple credit cards makes sense for some, but there can be drawbacks as well.

How Many Credit Cards Is Too Many?

The answer depends on your personal preferences and the types of credit cards you're looking to have.

 

Having a lot of credit cards isn’t for everyone. For starters, it’s a lot to keep track of. Also, if you’re earning points in all kinds of rewards currencies, you run the risk of having “orphaned balances,” or an array of different rewards balances that are too small to redeem for very much.

 

In addition, you might wind up paying several annual fees for benefits that sound great, but if you can’t use them very often – or they overlap from card to card – you could be paying more in fees than you get in value. Having a lot of cards can also make it feel like you have more money than you actually do.

 

Still, having a lot of credit cards can be great – if you’re careful. It’s important to be mindful of which cards you use for what kind of spending, and really think about how each card benefits your financial situation and lifestyle. With responsible use, you can:

  • Accumulate rewards that complement each other, such as earning points on different cards, or even in different currencies, that can transfer into the same airline program.
  • Maximize cash back earnings.
  • Earn points or miles for flights and hotels on the same trip.
  • Enjoy various benefits, from discounts at restaurants and elite status at hotels to free checked bags when you fly.

 

And for some people, managing credit cards and optimizing the value they get from those cards’ associated loyalty programs becomes a hobby all on its own. If having a spreadsheet full of information about points, miles, and credit cards doesn’t sound fun (or at least potentially worthwhile) to you, though, you may be better off with just one or a few credit cards.

Consider Having Zero Credit Cards if Access to Credit Increases Your Spending Benefits of Having Zero Credit Cards

Individuals who find themselves spending more money just because they have a credit card might improve their financial responsibility with zero cards. The benefits of having a credit card can be wiped out with extra spending, particularly if bills go unpaid and interest accrues.

 

But figuring out if you should have “zero” credit cards can take some work. In fact, studies have shown that people spend more using their credit card than they might otherwise with other payment methods.9 In controlled experiments, people with access to a credit card were willing to pay more for the same goods than those paying with cash.9

 

Now, many people will still want a credit card, and for good reason. Credit cards can be excellent tools for building credit, making online purchases safely, providing peace of mind for financial emergencies, and more. If you’re concerned about overspending on a credit card, setting personal limits can help you avoid increasing your debt.10

The Takeaway

So how many credit cards should a person have? It's ultimately a personal choice that's dependent on your finances and goals. Just remember: When considering a new card, make sure it won’t cause you more financial harm than good, and choose cards that don’t just look good in isolation, but add real value to your existing financial life and habits. You’ll figure out your own ideal number soon.

Headshot of Matt Crespi

Matt Crespi is a writer, consultant, and social science researcher focused on innovation, policy, and organizational behavior. He earned his PhD in Public Policy and Management at Carnegie Mellon University, where he co-founded the Corporate Startup Lab.
 
All Credit Intel content is written by freelance authors and commissioned and paid for by American Express.

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