How Many Credit Cards Should You Have?

According to statistics from loan and credit agencies, the average American holds anywhere from 5 to 10 credit cards, plus several loan payments. On average, that comes out to 13 credit accounts. That number is a bit outstanding according to credit experts. With all these credit cards and loan usages coming into play, this leaves nearly 85% of all Americans in some sort of non-mortgage related debt. Of those people, nearly 32% are in credit and loan debts of more than $10,000. Yikes!

Most of this debt is coming from the ease of gaining new credit cards advertising new rates and higher credit balances than what we already have. Getting a credit card is just too easy nowadays. While there is not a perfect number of credit cards one person should keep in their wallet, it’s easy to see that one person holding 13 credit cards could be a bit excessive. It all starts out when we hit 18 years old.

Applying for too many Credit Cards in College

College-age students are bombarded with credit card offers through mail. Then they get hit with credit cards set up at booths on their college campuses. They sign their name at the bottom of a form, and in a week a brand new credit card that lets them instantly buy things they normally couldn’t whether or not they have the money to actually pay for the product. Creditors know that college students will probably be pulled out of any credit problems by their parents, so it’s easy money for them. On average, a college student will get into credit problems early on with 3 to 4 credit cards. Plus it is very enticing for naive college students to sign up for a credit card to get a free gift that usually accompanies an application.

The Enticing Store Credit Card

Then people go ahead and apply for store cards. Store cards offer great deals, giving you 20 percent or so off your first purchase with your store card and continuing benefits after that. After the first purchase, though, the card can be a hassle if it isn’t frequently used. If the store card isn’t immediately closed after being paid off, it’s only one more credit account that could be adding to your debt and dropping your credit score. Another fact of store cards is that they drop your credit score by approximately 20 points after being approved.

Again, there is no perfect amount of credit cards, but there is simple advice that any credit expert could give you. Don’t take more than you need. Get the credit cards that offer you the best benefits, lowest interest rates, and a limit high enough for your spending habits. Don’t spend more than you can pay back, though. If you need two cards to fuel that, whether for personal or business purposes, then so be it, but if you cannot pay them off, don’t try using credit cards to finance your life. Credit cards are great tools when used right, but they can be downright evil with threats of debt and late fees added to that when we cannot make payments.

Credit cards can ruin lives when not used properly (clearly many people abuse them), and this website will try to help people with this growing epidemic.