How Many Credit Cards Should I Have? Credit Factors to Consider

How many credit cards should I have?

Credit can play a huge part in our financial journey in life. From getting your first credit card to financing a car to purchasing your first home, your credit score will play a key role all along the way. And one of the biggest factors that go into your credit score are the number of credit cards you have, and how you use them. But how many credit cards should you have? Is there a recommended number?

If you’re asking yourself, how many credit cards should I have, you’re on the right path. If you are even considering this question, you’re paying attention to the right things and may already have a leg-up in your financial journey!

There’s no magic number of credit cards that will lead to a perfect credit score, but there are certainly some good guidelines to follow. Let’s learn more!


How Many Credit Cards Should I Have?

There’s no hard-and-fast rule to determine the best number of credit cards for a good credit score.

On average, most Americans have around 3 credit cards. That doesn’t necessarily mean that’s the right number of cards to have, but it’s a good factor to consider.

You can have a good credit score with just one card, and you can have a good score with 10 or more credit cards. The fact of the matter is that there are many factors that contribute to your credit score. These factors are detailed below.

credit factors

As you can see, the two biggest components are on-time payments and capacity used.

On-time payments is obvious, but quite important. If you make on-time payments for all your credit cards, installment loans, mortgages, etc. that will hugely boost your credit score. Payment history makes up around 30% of your credit score.

Capacity refers to credit utilization, which is a bit more complex. Basically, it refers to the percentage of credit available to you that you are actively using. Credit utilization makes up an additional 30% of your credit score.

For example, let’s say you have a total credit limit of $10,000 on 1 credit card. You carry a balance of $4,000 on that card. This puts your credit utilization at 40%, which is considered high – ideally, you should try to keep your credit utilization under 30%. Keep in mind that FICO considers both your utilization on individual credit cards, and on all your cards as an aggregate.

So, these two factors alone make up 60% of your credit score – and have little to do with the number of cards you hold. What does this mean for how many credit cards should I have?


How the Number of Credit Cards Affects Your Credit Score

We’ve established that the number of credit cards you hold doesn’t necessarily have a huge impact on your score – but it certainly does have some effects. Here are some:

Opening New Cards

  • Results in “hard pulls” to your credit profile, which can temporarily ding your credit
  • Lowers your average age of accounts, which could lower your score
  • Adds more credit to your overall credit limit, which can lower utilization and potentially boost your credit score

Closing Old Accounts

  • Could affect your utilization rate by removing available credit from your profile. This could lower your credit score
  • Could slightly lower the average age of accounts, which could lower your score.

Having Too Few Credit Cards

  • Issuers want to see that you are responsible with credit. You should have at least one credit card in order to build your credit file.
  • It may be difficult to keep your utilization under 30% if you don’t have much credit extended to you.

Having Too Many Credit Cards

  • Issuers may consider you more risky if you have a high number of credit cards (10+). It may be harder to get approved for additional cards.


Can You Have Too Many Credit Cards? Extremes on Both Sides

To demonstrate that there’s no “perfect” answer to how many credit cards should I have, let’s look at some of the extremes:

On the low end, many adults just don’t have any credit cards. About 29% of Americans do not have a credit card at all, according to 2014 data.

On the high end, Walter Cavanaugh holds the Guinness World Record for the most valid credit cards held by a single person – at a whopping 1,497 cards!

And for a personal perspective, the author of this article (and a travel hacker) has 20+ open credit cards, with a FICO score of around 800.

Now, we’re not suggesting that you carry no cards, 1,500 cards, or 20 cards. Rather, we’re simply demonstrating the broad differences that make it challenging to answer the question of how many credit cards you should have.


Final Thoughts

How many credit cards should you have? There’s no perfect answer, but we’d recommend at least 1 or 2 cards. If you plan to carry a balance, you may want to consider adding a few more cards to help keep your total utilization rate lower.

Regardless of the number of credit cards you have, you should always use credit responsibly. Particularly if you have many cards with high credit limits, it’s vital to manage that credit responsibly and not get yourself into debt!


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