Every day we get lots of credit card applications in our mail boxes. Banks and credit card companies do everything to attract our attention. They offer us credit card deals to suit all our needs: reward credit cards, business credit card deals, student credit cards and etc. No matter, how high your credit score is you can always find a deal for you.
Credit cards promise different benefits to us: cash back, free movie tickets, discounts, free flights and hotel stays, etc. That is why having gotten one more credit card offer in the mail box, we are so easily tempted to apply for one more credit card deal. But there’s a question: how many credit cards you need? Can the number of credit cards you own affect your credit score?
The researches show that most Americans use from 5 up to 10 credit cards. An average American family has credit card debt about $12,000 when an average household is only $ 50,000. This credit card debt makes 24% of a family’s annual income and it is without mentioning their car loans and mortgages. Isn’t the statistics is impressive?
The question is: How many credit card deals are enough? Most financial experts advise credit card owners to cut the number of credit cards they own up to two or three credit cards. Financiers are sure that two or three cards are quite enough for a family.
One of the reasons to limit the number of credit cards you own is your outstanding balance. Credit card companies and banks stick to the rule that credit card balance should be between 25% and 50% of the available credit on each credit card of a debtor. If you exceed your balance, banks will likely decline your request for a new credit card.
Before applying for one more credit card, consider your needs and financial opportunities to make sure that you need this card and will be able to pay the bills. Think, using 3 reward credit cards, 2 gasoline credit cards and a business credit card at the same time can make it rather difficult to keep your balance on all these cards under control. However, if you own only 2 or 3 cards, you will be able to keep track of your spending’s and will know exactly where you stand with your balances!
Using too many credit cards you are likely to feel that you work for them but not credit cards work for you. Mind, every new credit card makes a new debt. So, consider your needs and purposes carefully before applying for a new credit card in order to get the card that will fit all your needs. It is better to have few credit cards that will fit all you needs and that you will really use, than to have ten credit cards and hardly use half of them. Don’t get into deeper debt just because of pursuit of a new credit card that will offer you the same features as one of the credit cards you already have.