What is the ideal number of credit cards for a good credit score? (2024)

FAQs

What is the ideal number of credit cards for a good credit score? ›

If your goal is to get or maintain a good credit score, two to three credit card accounts, in addition to other types of credit, are generally recommended. This combination may help you improve your credit mix.

Credit scoring formulas don't punish you for having too many credit accounts, but you can have too few. Credit bureaus suggest that five or more accounts — which can be a mix of cards and loans — is a reasonable number to build toward over time.

To prepare, you might want to have at least three cards: two that you carry with you and one that you store in a safe place at home. This way, you should always have at least one card that you can use.

There is no right number of credit cards — it depends on how many you can manage. Having multiple credit cards helps reduce your utilization rate and provides lenders with more information to better gauge your creditworthiness.

Advantages of Having Multiple Credit Cards

Helps Build Credit Score: Those who have several credit cards and still make all payments on time, will build a very good credit score. This will increase the credit worthiness of the individual and give him or her access to more credit opportunities.

There's no set rule on how many credit cards are too many as it depends on several factors, like credit health, age, income, and utilization ratio. That said, having too many can negatively impact your credit health because keeping track of your payments can be hard.

There's no limit to how many credit cards you can apply for in a day, but submitting multiple applications at once isn't necessarily a good idea. Applying for and opening several cards can result in hard inquiries and a lowered average age of accounts that can hurt your credit scores.

According to cardholder reports, Bank of America uses a 2/3/4 rule: You can only be approved for two new cards within a 30-day period, three cards within a 12-month period and four cards within a 24-month period.

There's no such thing as a bad number of credit cards to have, but having more cards than you can successfully manage may do more harm than good.

It's generally recommended that you have two to three credit card accounts at a time, in addition to other types of credit. Remember that your total available credit and your debt to credit ratio can impact your credit scores. If you have more than three credit cards, it may be hard to keep track of monthly payments.

What is a 5 24 rule? ›

What is the 5/24 rule? Many card issuers have criteria for who can qualify for new accounts, but Chase is perhaps the most strict. Chase's 5/24 rule means that you can't be approved for most Chase cards if you've opened five or more personal credit cards (from any card issuer) within the past 24 months.

What Credit Card Do the Super Rich Use? The super rich use a variety of different credit cards, many of which have strict requirements to obtain, such as invitation only or a high minimum net worth. Such cards include the American Express Centurion (Black Card) and the JP Morgan Chase Reserve.

Opening multiple card accounts in a short period of time can actually hurt your credit score and can also jeopardize larger financial goals like getting a low mortgage rate when buying a house.

Having a lot of credit cards can hurt your credit score under any of the following conditions: You are unable to keep up with your current debt. Your outstanding debt is more than 30% of your total available credit. You added too many cards in too short a time.

Credit experts advise against closing credit cards, even when you're not using them, for good reason. “Canceling a credit card has the potential to reduce your score, not increase it,” says Beverly Harzog, credit card expert and consumer finance analyst for U.S. News & World Report.

Carrying multiple credit cards can be a problem when you have to maintain the payments every month for each of the cards. And late payments can lead to reporting to the credit bureaus eventually lowering your credit score.

You should aim for 9+ years to score "Excellent." Total accounts: You need 21+ accounts to score "Excellent." If you have 20 cards and low utilization, you're seen as more responsible to the credit agencies.

If you're close to maxing out your credit cards, your credit score could jump 10 points or more when you pay off credit card balances completely. If you haven't used most of your available credit, you might only gain a few points when you pay off credit card debt. Yes, even if you pay off the cards entirely.

The average adult has around 5 credit cards, including store credit cards, but there's no golden rule for how many credit cards you should have - or how many credit cards is too many.