Managing Multiple Credit Cards

Last Updated: January 11, 2024

5 min read

Key points about: having multiple credit cards

The right number of credit cards to have depends on the person’s spending habits and financial needs.
Benefits of having multiple credit cards include having a backup card or taking advantage of multiple rewards programs.
Applying for multiple credit cards at once will result in hard inquiries on your credit report and could impact your credit score.

With so many credit card options, you may find it convenient to have multiple cards and accounts. Using different credit cards can also help you maximize your rewards and increase your overall available credit.

Still, there are risks to having multiple credit cards. That’s why it’s important to understand the pros and cons of managing multiple credit cards, as well as strategies for handling credit card debt and making the most of your credit card rewards.

Reasons to have multiple credit cards

Using multiple credit cards can offer many benefits to cardmembers.

Backup if a credit card has a security issue

If one of your cards is lost or stolen, you’ll have a backup one to use until you get a replacement card. Having multiple credit cards can help ensure you always have a credit card to use for certain purchases or during an emergency. Just remember that it may be helpful to carry or store at least one card separately from your other cards to avoid them all being stolen or misplaced at once.

More credit to access

If you have a card with a low credit limit, getting one or more additional cards can increase your total credit, giving you the ability to make more purchases. Having higher overall credit available can also help lower your credit utilization ratio, which can contribute to an improved credit score. Your credit utilization ratio is the percentage of your available credit that you spend. As a rule of thumb, it’s best to keep your credit utilization ratio as low as possible.

Enjoying multiple credit card rewards programs

Having more than one credit card can help you access various types of rewards programs or cash back rewards. If your current rewards card offers cash back or another type of reward for travel, you may want a new credit card that offers perks for different purchases, like gas or groceries. Consider which type of rewards program might work best for your spending needs before deciding which new card to apply for.

Did you know?

Discover offers a wide selection of rewards credit cards and every Discover card earns rewards on purchases. Choose the card that earns the type of rewards that are most valuable for you.

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Disadvantages of having multiple credit cards

Even with these potential benefits, using multiple credit cards may have certain disadvantages.

Harder to manage spending

With multiple cards in play, you may find it challenging to keep track of your total spending and your credit usage. You may even be tempted to overspend, especially if you have a large amount of credit available. Even with a higher credit limit, overspending could hurt your credit utilization ratio. It's also important to note the interest rate on each new credit card. If you carry multiple balances, each one's interest rate may cause your credit card debt to grow rapidly.

Easier to miss a payment

Each different card may come with its own payment date, potentially making it more difficult to submit payments on time. Overdue payments can appear on your credit report and hurt your credit score. A low credit score can impact your ability to open a new credit or loan account.

Multiple cards may mean multiple annual fees

You may sign up for cards during an introductory period to take advantage of an annual fee waiver. Once that introductory period ends, however, you’ll be left with multiple cards that carry annual fees.

If you want to use two or more credit cards, you might consider options without annual fees. Discover, for example, does not charge an annual fee on any of its cards. So, you can have more money to spend where it matters.

Should you apply for multiple credit cards at once?

Each credit card application results in a hard credit inquiry, which may lower your credit score. Applying for different cards at the same time also makes you look risky to lenders, so it’s best not to do this if you’re planning to apply for another credit account, such as a home loan or personal loan, in the near future. You should also check to see if the card issuer limits the number of credit card accounts an individual can open.

Best ways to manage multiple credit cards

It’s important to know how to use multiple credit cards effectively and manage them responsibly to best meet your financial goals and build a strong credit history.

Use all of your cards regularly

Some credit card issuers will close your credit card account if you don’t use a card for a certain period of time. This will lower your total available credit, which may hurt your credit score. So, remember to use all of your cards regularly and keep them active.

Set payment alerts

Keep track of multiple cards and make payments on time by setting up payment notifications instead of relying on a paper credit card bill. Most credit card issuers will allow you to enable payment alerts or set up automatic payments so that you don’t miss due dates.

Avoid cancelling multiple cards at once

Cancelling many cards at the same time may impact your credit score, especially if you carry a balance on your remaining cards. That’s because closing an account will lower your total available credit, raising your credit utilization ratio.

Keep track of rewards

Check which spending categories earn a higher rate of rewards for each card. Then make sure to put each purchase on the card that offers the best and most relevant rewards. If one card offers rewards for travel purchases, for example, make sure to use it when booking your plane tickets and hotel reservations.

What number of credit cards is best?

No specific number of credit cards is best. It all depends on the individual’s spending habits and financial needs. When managed properly, multiple cards may yield more advantages than disadvantages. You will have to determine how many cards you can manage to ensure you maintain good credit.

The best credit card mix for each person may differ. For example, maybe you already have a bank credit card, but want to earn cash back on gas. In that case, you might benefit from adding a second credit card from a credit card company that offers those types of rewards. However, it's always important to make sure you can manage your existing credit responsibly before completing a credit card application for a new credit card.

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