How Many Credit Cards Do You Need?

When you are out shopping or even when you are shopping online, you will get offers to open a credit card account with the stores or merchants. These can be very interesting or tempting since a lot of these invitations come with offers such as a discount on your first purchase or free shipping on all your purchases charged to the store credit card.

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At some point, you are going to ask yourself, is having many credit cards bad for your credit score? Remember that you will still need to pay for your credit card bills, so they may be fun to use until you receive your bill and if unpaid, can be devastating to your finances and credit rating. Here are some points to consider.

Remembering Due Dates

Unfortunately, more credit cards mean more due dates to remember. If you are always on the go, this may not be a good thing, since you will always have to sit down, check your credit card bill for any unauthorized transaction and then pay for the credit card. True, that you can now pay for bills with just one click from your phone or computer, but it can still eat up some time if you have 8 to 10 credit cards to monitor every month.

Higher Credit Limit 

One good thing about having a lot of credit cards is that you have higher credit limits. Part of determining your credit score is looking at how much available limit or credit you have. The higher your available credit limit is, the better for your credit score.

Each New Credit Card Account is A New Inquiry

You need to know that every time a financial institution checks for your credit score, has a possibility of pulling your score down. These inquiries are called hard inquiries. However, as these inquiries age and in time they will have little to now effect on your score. So, make sure that you do not open too many new credit cards in a short period of time because all those inquiries on your credit score can be devastating.

Think About the Discounts

Companies like Victoria’s Secret, Target Walmart or TJ Maxx offer discounts when you open a credit card account with them. Still others, like Gap / Old Navy, allow you to earn points when you use their credit cards and those points can be converted to credits for purchase at their stores. Lastly, financial institutions like Citibank or Chase, offer promotions such as zero percent interest on balance transfers when you open a new credit card account with them. These discounts and offers can pile up and be very good savings for you, so be on the look out for them too.


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