HOW MANY CREDIT CARDS IS TOO MANY ?

 

HOW DO YOU KNOW IF YOU HAVE TOO MANY CREDIT CARDS?

How many are too many? Is there a set rule or a prescribed limit? Apparently not from what I have read. But what I have found is that when I have to spend hours almost daily to monitor them, it is too many for me.

many credit cards
How many Credit Cards Should You Carry? from moneyunder30.com
HOW DID I END UP WITH SO MANY CREDIT CARDS?

When I discovered that cash reward credit cards could be a reliable way to reduce my monthly expenses, I started applying for them as often as I could. Of course, the idea was to get the largest promotional welcome bonus, the highest % of cash rewards as well as a substantial amount of available credit. Therefore for about the last three years, gathering cash reward credit cards has become a major pastime. Well, guess what? Now I have too many cards.

credit cards
From creditcard.com, One Credit Card or Many? How to Decide?
THE JOURNEY TO TOO MUCH

It has been a tremendously educational experience collecting all the cards I have. Primarily, it has helped and still helps to reduce my expenses. In addition, I have written many blog posts and several Ebooks about this. Doubtless, there will be more. But the most significant comment I can make at this time is that right now I have too many. As I mentioned in a previous blog post, I have reached critical mass.

FICO score factors
There are Six Primary Credit Card factors in the major FICO® scoring system as illustrated by Credit Karma®

For most of this time, my primary concern has been focusing on the 5 or 6 FICO® credit score factors that go into building a good credit score. Certain cards have taken priority for charging purchases. Then it recently occurred to me that if I did not start using all of my cards, some could be closed for inactivity. That could affect my credit score negatively by lowering my available credit, changing the average length of time I have had cards and flagging too many closures. Low and behold, that is exactly what happened this week. One of my co-branded cards was closed without notice for inactivity.

Account-Closed
Credit Monitoring Alert from CreditSesame.com
HOW MANY CARDS DO I NEED?

I need enough cards to satisfy the FICO® score factors. Fortunately, I found a formula that I could use to determine how many cards to own, which ones to keep and those to phase out since I had surpassed critical mass. These are the factors I now consider in which cards to use:
a. the oldest aged accounts
b. those with the best credit line and lowest credit utilization ratio
c. the ones with optimal returns in my top spending categories
d. those that give me the maximum value for use with my favorite merchants, stores, airlines or hotels

straight flush credit card collection
Optimize the Credit Cards You Carry with A ‘ Straight Flush’
HOW MANY CARDS DO I WANT?

My sense is that I would like to have no more than ten at the most. For example, my ‘straight flush’ analogy illustrates most of them. Beyond that, I think that one or two travel cards are essential. Other than that, an additional card or two in the ‘straight flush’ formula would be OK too.

FICO® score 9/24/19
My FICO® score in September 2019 according to CreditJourney
CONCLUSION

I am at a new beginning. I have climbed the credit card mountain in excellent standing. Now it is time to descend the other side with equal care. Therefore future writings on this topic will involve reducing my load doing my best to maintain my great credit card standing while keeping also 6 FICO® score factors in balance.

SOURCES & RESOURCES

How Many Credit Cards Is Too Many?
How Many Credit Cards Should I Have?
Images of Many credit Cards

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