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There are no hard and fast rules dictating the perfect number of credit cards to have in your wallet. Some people are comfortable with only one credit card, whereas others feel that two or three credit cards is a safe number.
It really all depends on personal preference, and while only you can decide how much is too much, there are signs that indicate too much plastic.
1. You forget about some of your accounts.
Off the top of your head, how many credit cards do you have? Don’t feel bad if you have to pause and count in your head. But if you accidentally omit a few credit cards, primarily because you forgot you had them, maybe it’s time to trim your wallet and close some of your accounts.
Closing an older credit card account might lower your score, as this can reduce the length of your credit history. So, it’s best to close newer accounts. And if for some reason you’re not ready to cancel some of accounts, continue to keep these cards in a safe place – just don’t apply for any new accounts unless absolutely necessary.
2. You can’t pay all your credit card bills.
If the credit card bills constantly roll in, yet you don’t have cash to keep up with your minimums, chances are you have too many accounts. You can’t wish away the debt and your accounts. But you can develop a strategy to pay down your balances faster, and afterwards, slowly close a few of your newer accounts.
3. Your credit score plummets.
It’s a good idea to check your credit history and credit score at least once a year. This way, you know where you stand, and you won’t get hit with surprise rejections when applying for loans. The fact that your score isn’t in a good place might indicate too many credit cards.
If you keep your balances low or pay off your accounts each month, having a number of credit cards won’t hurt your personal rating. But this isn’t the case if you have high balances or maxed out accounts. The more you owe, the lower your score. Plus, frequently applying for new credit cards can harm your score. Each credit inquiry shaves point off your rating and it takes time to regain these lost points.
4. You’re turned down for new credit cards.
Maybe you don’t feel that you have too many credit cards, but another creditor might. When applying for any type of credit, expect creditors to scrutinize your present credit history. They’ll take a look at your loan and credit card balances, and weigh this against your income. If you already have several credit cards, a creditor might take one look at your credit report and conclude that you’re maxed out and reject your application.
5. You keep forgetting your due dates.
Forgetting due dates might be an innocent mistake, but it’s also a costly mistake. And unfortunately, having too many credit cards increases the risk of overlooking a due date and getting hit with a late fee.