How many credit cards should I have?

You’ve probably heard of the many benefits you can reap from using the right credit cards. Complimentary access to luxurious airport lounges, travel insurance and 0% introductory APRs are just a few of the perks available to consumers with credit cards.

But how many cards should you open and hold at any given time? Unsurprisingly, there isn’t a single, magical number of credit cards that’s “right” for everyone. Some people thrive on rotating through a sheaf of cards with myriad benefits for every type of expense, while others need to keep things simple with a single daily driver.

This guide will walk you through several considerations to keep in mind when filling your wallet.

What to consider when deciding on the number of credit cards

Before you get deeper into the world of credit cards, take a quick inventory of your current financial situation using the questions below as a guide.

Do you have healthy financial habits?

If you struggle with responsible spending, stop right now: This environment is not for you. If you can’t spend within your means and pay off your credit card balances in full each month, pause on adding more temptation to your wallet until you can resolve this issue.

Even if you have strong financial hygiene, it’s a good idea to think through your current habits surrounding money. Are you the kind of person who meticulously tracks your purchases throughout the month, or do you use autopay to clear your statements because you find it tedious to look through your accounts all the time?

The more credit cards you hold, the more responsibility you have to manage them well. If you prefer to keep things simple, stick with a maximum of three cards to avoid losing control of your money management.

How strong is your credit profile?

The number — and type — of credit cards you can hold depends on your creditworthiness, typically determined by a combination of factors including your income, credit score, credit history and spending habits.

The most desirable credit cards require you to have an excellent credit score for approval. Credit bureaus Equifax and FICO define this range as credit scores of 800 and up, although you may be approved for lower-tier cards with a score of 670 or higher.

Of course, other components of your financial profile play a large part in how card issuers perceive you as a lending risk.

Your credit utilization ratio is one of these factors. This ratio is the percentage of your total available credit limit that you use for debt at any given time. If your credit card has a $10,000 credit limit and you charge $1,000 on that card, your credit utilization ratio is 10%.

If you only have a combined credit limit of $5,000 but regularly use 80% of that or more per month (even if you pay in full), consider asking your current issuer for a credit limit increase before signing up for new cards so you can lower your utilization ratio.

Finally, some credit card companies won’t allow you to hold more than a set number of cards from that issuer or to sign up for too many within a certain window of time. Once you’ve reached those limits, you’ll have to consider credit cards from another issuer, or do something about the ones you already hold. For example, Chase’s 5/24 rule will prevent you from being approved for most of its cards if you’ve opened five or more new credit cards in the past 24 months.

What do you want to accomplish with your card rewards and benefits?

You don’t need multiple credit cards if you just want simple cash back rewards for the money you spend each month. Just find a cash-back credit card that offers a generous flat rate of rewards and use it for everything from groceries to travel to gas.

If you’d like to diversify your earning potential, consider rotating between two or three cards to maximize your rewards across a range of different expenses. Some cards offer increased rewards on everyday spend such as gas and groceries, while others provide premium travel benefits such as airport lounge access and expedited security screening.

Diehard credit card rewards enthusiasts regularly juggle more than a dozen cards at any given time to take full advantage of every perk possible. If you want to join their ranks, make sure you have a rock-solid strategy in place for tracking and maintaining each of your accounts.

Benefits of having multiple credit cards

There are many benefits to holding multiple credit cards. Here are some of the most popular reasons to consider expanding your wallet.

Maximize your earning potential

Different cards offer different benefits, and you can quickly rack up enough points to fly to Europe or Asia for a fraction of the usual cost if you diversify the way you earn them.

Many cards offer elevated points or cash back per dollar spent on select categories such as dining out, travel, utilities, gas and streaming services. If you use a flat-rate cash back or rewards card for these purchases, you’ll earn at a lower rate than if you rotate cards depending on the category of purchase you make.

Increased credit limit, history and credit score

Holding multiple credit cards can actually be good for your credit.

“If you pay your bills on time and maintain respectable amounts of credit card debt on a limited number of cards, then you’re going to have good or better credit scores,” said credit expert John Ulzheimer, president of The Ulzheimer Group and founder of CreditExpertWitness.com.

Signing up — and being approved for — a new credit card can be one way to increase your overall credit limit. If you hold multiple cards from different issuers, you can expand the total amount you can theoretically spend on your credit cards.

That credit limit can be helpful if you need to apply for a mortgage, a car loan or any other expense which requires you to prove creditworthiness.

Diversify your risk

The old adage, “Don’t put all of your eggs in one basket,” can easily apply to misplaced, lost or stolen cards. If you have more than one credit card with you while traveling, for example, you can still continue on with your trip if you lose one or if a merchant doesn’t accept it.. But if you rely on a single credit card everywhere, you could strand yourself if it gets stolen or lost.

Risks of having too many credit cards

There’s a flip side to holding multiple credit cards. Here’s what you should look out for if you begin expanding your card portfolio.

Greater temptation to overspend

The more buying power you have, the more tempting it can be to imagine yourself spending up to that limit. If you have multiple credit cards, your credit limit is probably higher than when you started out with your first card, which can make purchasing that new couch or splurging on a fancy vacation feel more accessible.

If you do need to make a large purchase, consider signing up for a 0% introductory APR credit card so that you have a longer timeframe for repayment. Then make a plan to set aside enough each month to pay off the balance before your introductory period is up.

Losing track of your accounts

It’s easy to forget about a credit card if you have more than one. Credit card interest rates can add up quickly, so it’s imperative that you develop a system for tracking every card’s details, including payment due dates and other important deadlines.

Higher chance of theft, fraud or exploitation

Even if you don’t lose track of your own accounts, holding multiple cards opens you up to greater risk. Any financial account you hold has the potential to be hacked, stolen or otherwise tampered with — so the more of them you have, the more vigilant you have to be about protecting your money.

You can limit some of your financial risk by increasing your security for each account. Choose unpredictable passwords and do not share login information between different accounts.

Some people have their financial information leaked when online retailers get hacked. You can protect yourself by deleting saved credit card information from online retailer shopping accounts.

You can also use a payment processor such as PayPal , Amazon Pay, Google Pay or Apple Pay to process online transactions instead of inputting your card information directly into the retailer’s check-out page.

How to determine the right number of credit cards for you

With all the information above, you might feel more overwhelmed than ever. These two principles below can help you decide what works for you.

Understand your personal “consumer profile”

Imagine a spectrum with simplicity on one side and maximum rewards on the other. Now think about where you’d like to fall on that scale when it comes to managing your credit cards.

If you’re the type of person who enjoys the thrill of a good deal, you might enjoy the game of juicing every possible perk out of a dozen credit cards. But if you’re the kind of person who doesn’t want to fuss with multiple bonus categories, you might want to forego all the bells and whistles of premium credit cards in favor of a flat-rate rewards card.

Keep your total credit utilization to 10% or less

John Ulzheimer recommends keeping your total credit utilization to 10% or less.

“If your average monthly balance is $2,000 then you need enough cards so you’ll have at least $20,000 of credit limits,” said Ulzheimer. “At $5,000 you need enough cards to have at least $50,000 of credit limits. That protects your credit scores because the optimal ratio is at or below 10%.”

The number of credit cards it takes to maintain a 10% or lower utilization rate depends on the individual. “If it takes five cards to get you to 10%, then five cards is right for you,” Ulzheimer said. “If it takes three cards … then three cards is right for you. If it takes seven cards … then seven is right for you.”

Tips for managing multiple credit cards

Pay off your cards in full every month

Simplify your maintenance efforts by setting all of your card payment dates to the same day of each month. You can also set up automatic payments for your statement balance so you won’t accidentally forget a due date.

Keep track of your cards and due dates

Develop a system for tracking every card you hold, including account opening and closing dates.

Track each card’s payment due date and various other details such as introductory APR end date or annual fee renewal date. You can do this by keeping a spreadsheet or by using an app for card management.

It’s also a good idea to have the customer service phone number for each credit card so you can quickly reach out for help if you misplace the card or need card-specific assistance.

Check your accounts on a weekly basis

Set up a weekly time block for you to look through your accounts. This exercise can be tedious, but it’s really important for identifying potential fraud, erroneous charges or missed payments on important bills.

Commit to keeping most of your credit cards once you open the account

Signing up for new cards can be addicting, especially if you like chasing welcome bonuses. You may be tempted to cancel your credit card once you’ve earned your bonus and it’s time to pay your next annual fee.

But you shouldn’t close the card until you’ve held it for at least 12 months because you may end up losing your sign-up bonus from the issuer. Plus, thoughtlessly closing cards can negatively impact your credit score.

“Keeping cards open helps your mix of credit,” said Shiva Bhaskar, senior attorney and cofounder of Tier One Credit, a credit repair firm. “Closing a credit card can reduce total credit limits, and thus increase utilization. This can harm your credit score.”

Instead, evaluate each credit card before you apply to ensure that it has a home in your wallet even after the honeymoon period. In some cases, you may be able to downgrade a premium card to a no-fee version to eliminate your annual fee after the first year. You can also check to see if you are eligible for a retention bonus, which some issuers offer to entice you to keep the product.

Don’t keep cards you no longer use

On the flip side, sometimes it’s time to let go of some cards that no longer fit your financial strategy. If you’re not sure whether or not you need a certain card any longer, try “locking” it to prevent yourself (or anyone else, such as card thieves) from using it. If you haven’t used it after six or 12 months, it might be time to let that card go, especially if there’s an unavoidable annual fee.

If you do decide to close a credit card, make sure you’ve paid off any outstanding charges before doing so. You may also want to see if you can transfer some of your credit limit to another card from the same issuer in order to maintain your overall credit limit. Otherwise, canceling a card outright can cause a temporary dip in your credit score because the total amount of credit available to you will decrease.