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Too many credit cards?

By Edited Feb 4, 2014 0 1

All throughout our lives we have been told, or at least I've heard tons about how you shouldn't get too many credit cards because too many credit cards will hurt your credit score. Well, I scoff at that!

I don't know where the "too many credit cards" myth was started, but let's just say it's not true. The reason why I know that's not true is because I have well over 25 of them and continue to receive the cards I apply for. Now granted, it was MUCH easier before the credit crisis hit us a couple years ago, BUT, if you have a solid income with a GREAT credit score, you still can get new credit cards and maintain your existing lines. Now granted, this does not mean that you should just go and get as many as you can, BUT, don't be afraid of taking advantage of offers that fit your needs.

In the past, I would apply for cards because of a bonus they offered to apply for the card and using it, usually just once. For instance, I got my Chase Cash Freedom card, no longer a sweet offer by the way, because they were offering a $250 bonus after I used it once. Guess what I did with the card, put a $1 purchase on it and collected my $250. Now I could have stopped using the card, but I didn't because the cash back on the card was very useful too me. Because of the credit tightening we've been experiencing, they have changed the cash back percentages and so it is not as useful for me to use any longer. I still keep the card because it looks good on your credit report to have open lines. I just have to make sure to keep an eye on it so that nothing funny goes on with my card. It's a rather small price to pay in my opinion.

Now with my 25+ credit cards, I'm sure your thinking my credit score must suck. Well actually, it doesn't. My score is in the mid 700's, 763 via Credit Karma to be exact, just checked. I don't receive as many credit card offers as I used too, but the trickle of balance transfer offers from my existing credit cards is slowly picking up. If a compelling offer does come my way, heck yeah I'll take advantage of the offer. What good is a good credit score if you can't profit from it.

Now with this 'evidence', you may be thinking, oh yeah, I'm sure this person makes a ton of cash and that is why. Well actually, I got most of my credit cards while I was making much less money and only a few of the card issuers are aware of my updated income. Needless to say, let's just say my available credit is FIVE times my income back in the day. That is why I am trying to dispel the myth that having too may credit cards is bad for your credit score. Now I will admit that if your balances on the cards are too high, then yes, your score will go down. However, if you maintain your balances to within 30-50% of your available balances across all of your lines, then it's not THAT bad. Now granted, the credit agencies have not come out and said, you need to hit these numbers. This is all my experience. You may experience a different outcome. Not to mention that different lenders have different requirements.

As a closing, what I am trying to say is that there is no truth to having too many credit cards. Remember, the card limits are only your ability to charge and the score does not get affected by that. It is up to each individual lender to determine if you have too many credit cards. Besides, check your credit report. Is your income reported on there? Yeah, income does not determine your score. Again, it is up to the lender to determine if you have too much credit available to you, which is of course reported on your credit report and does affect your credit score.
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Comments

Sep 28, 2010 10:23am
mcimicata
Amazing article! I definitely enjoyed reading it, and learned quite a bit...I will refer it to anybody that is curious about the subject matter.
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