Have you ever thought about whether you have too many credit cards, or if you compare yourself to other people and think you need another one? Then welcome! You are not the only one with this concern.
But, before we start...
There is no exact number that determines how many credit cards we should have. In reality, we are all in different situations and the right amount for everyone depends on many factors. So it's important to consider the following points:
How do I know how many credit cards I need?
First and foremost: the number of credit cards you need compared to how many you would like to have are two very different things. This applies not only to people who have too many cards, but also to those who prefer to avoid them because they believe that having a card immediately leads them into debt.
However, even though you can go through life without a single credit card, if you want to build and maintain a good credit history, you should start by having at least one (spending within your means and paying on time).
Remember that having a good credit history allows you to access better interest rates and more favorable conditions, not only to acquire other credit cards but also to access other credit cards. to more financing options that you may need in the future..
Why have more than one card?
In addition to building your credit history, there are some reasons why it would be good for you to have more than one card. Like taking advantage of perks and rewards that change from card to card.
For example, some credit cards offer travel insurance or access to airport lounges. Others come with a rewards program where you can earn points or cashback (money) they give you back a percentage of your purchases that you can use in restaurants, supermarkets and other stores.
How do I know I have extra cards?
Ultimately, there is no rule about how many credit cards are too many. It depends on how much you use them, how you manage your payments, whether you can afford both fees and annuities, and how much you're getting out of each card.
If you're struggling to keep up with your monthly payments, then it's time to pause and reconsider how you're using them. Another way to determine if you have too many credit cards is to add up the fees and annuities on each one to see if the cost is worth the benefits.
If your answer to the above is no, then consider canceling at least the card or cards that charge you the highest interest rates. But, in order to avoid damaging your credit rating, keep in mind that the first step is to pay off any debts you may have with these cards.
So when do you have yes sense to acquire another credit card?
Adding another credit card to your financial management can be a good option when you want to meet specific goals such as transferring a balance to a card with lower interest rates.
If you're planning a trip, for example, you may want to look for a credit card that offers great rewards like points that can be redeemed for travel or hotel stays.
Maybe you have a card that charges very high interest rates but you want to keep it for its benefits. In that case you can then look for another alternative that gives you better conditions for more frequent use.
Before making a decision, remember that...
Having more than one card means having more than one cut-off date, payment date, fees, annuities, etc. So, if you decide that it is in your best interest to have several credit cards, keep in mind that you will have to be very organized.
Credit cards are neither good nor bad in themselves. They simply need to be used correctly to leverage their advantages and avoid debt problems.
So before you ask yourself "how many cards should I have?" do a review of what your financial habits and goals are. This way all of your decisions will be clear and aimed at empowering your financial well-being.