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@SirAlphonse wrote:
@tufa4311 wrote:
@longtimelurker wrote:It is believed that 3 cards is enough to maximize score (to avoid too few/too many cards with balance(
You probably want at least two issuers and at least two networks, which can be accomadated in three cards.
Anything else depends on goals (cashback, travel etc) and spending patterns
Please expand - issuers/networks? What specifically are these and what are the differences between the two?
The issuer is the bank/creditunion who issues the card for example Chase, Bank of America.
The network is who handle the processing of the credit card transactions, they act as gateway between merchants and credit company. For Example Visa, MasterCard, American Express
Right. Ideally, you need both types of diversity. If all your cards are from one bank, you could find all your cards frozen or closed because of some issue (either correctly or otherwise). On networks, a handful of places will accept only one (e.g. Costco moving to VIsa) and also protects against network communication issues, when your merchant cannot connect to Visa for example.
Correction, 8 cards is the ideal number.
"A Gallup survey conducted in April 2014 found that the average number of credit cards Americans say they carry is at an all-time low. According to the Gallup survey, the average number of cards owned by all Americans -- including those with no credit cards -- is 2.6. Among Americans with credit cards, the average number of cards owned is 3.7. The percentage of Americans who have no credit cards rose to 29 percent in 2014, up from 22 percent in 2008.
Among the other 2014 findings:
33 percent had one to two cards.
18 percent had three to four cards.
9 percent had five to six cards.
7 percent had seven or more cards."
hmm so I guess Myfico members fall somewhere below 7%.
@Anonymous wrote:Correction, 8 cards is the ideal number.
Congrats on the Freedom!
When you want to build credit, you should consider both obtaining only quality cards (those that provide the best cash back for you, or the lowest APR if you carry balances, or the best travel points, whatever is best for you). But, you also need to consider if you want to obtain a lot of cards, in order to add stability to your credit.
You can certainly build a good credit score with just one card. But, years from now when you want or need another card or loan, your Average Age of Accounts will be halved by just adding one more card (or mortgage, or car loan, etc). I currently have 11 open and 3 closed credit cards on my credit reports. If I apply for a new card, it barely dents my AAoA. And there are always good reasons to open another card (better cash back, great sign up bonus, very low APR, etc). So, once you have a few cards with some age to them, are you actually planning to USE your future good credit to benefit you? Will you apply for a morgage, car loans, and additional cards? Do you mind that this will lower your AAoA and thus affect your credit? If so, you need a bunch of cards.
The next thing is, you don't want a bunch of low quality cards. Ideally you want Premium Bankcard Accounts (cards issued by Banks, with $10,000 credit limits or higher). You're not going to start off with those limits, but start building a group of quality cards that benefit you and are mostly issued by banks, and work on geting the credit limits increased with usage over time.
If you're interested in cash back cards, click on a card in my signature, that will take you to a thread that contains a bunch of spreadsheets I created. You should be able to find some good cash back cards in there for the categories you spend in, and the amounts you typically spend.
It's a personal preference. You can have less than 7 and have a great credit score. Really you don't "need" more than 3 for that purpose. That being said, you have to find your comfort zone for your spend and how many cards are justified reward wise -- it can be annoying to spread yourself too thin with spend across many cards because you end up with tiny amounts of rewards that are not really useable (or you have to wait a loooong time to redeem).
As with anything else in life what works for one won't necessarily work for the other. Some members here have 20+ cards and love it. To me, I am not interested in managing that many cards because it's too much time and hassle for too little benefit in my perspective. That's why I have 4. I like it this way. But it depends on your wants and needs.
@Themanwhocan wrote:When you want to build credit, you should consider both obtaining only quality cards (those that provide the best cash back for you, or the lowest APR if you carry balances, or the best travel points, whatever is best for you). But, you also need to consider if you want to obtain a lot of cards, in order to add stability to your credit.
You can certainly build a good credit score with just one card. But, years from now when you want or need another card or loan, your Average Age of Accounts will be halved by just adding one more card (or mortgage, or car loan, etc). I currently have 11 open and 3 closed credit cards on my credit reports. If I apply for a new card, it barely dents my AAoA. And there are always good reasons to open another card (better cash back, great sign up bonus, very low APR, etc). So, once you have a few cards with some age to them, are you actually planning to USE your future good credit to benefit you? Will you apply for a morgage, car loans, and additional cards? Do you mind that this will lower your AAoA and thus affect your credit? If so, you need a bunch of cards.
The next thing is, you don't want a bunch of low quality cards. Ideally you want Premium Bankcard Accounts (cards issued by Banks, with $10,000 credit limits or higher). You're not going to start off with those limits, but start building a group of quality cards that benefit you and are mostly issued by banks, and work on geting the credit limits increased with usage over time.
If you're interested in cash back cards, click on a card in my signature, that will take you to a thread that contains a bunch of spreadsheets I created. You should be able to find some good cash back cards in there for the categories you spend in, and the amounts you typically spend.
Great response as it offered a number of question I had not considered.
First, if I want more cards I should do it now as, yes, it will hurt my AAoA more down the line.
Next, yes, I use all my cards on a revolving basis - this month it's card X, next month card Y just to give all use but not to have more than one card reporting.
A mortgage and auto loan are for sure in the relatively near future.
My average DL is 6K with only one at 10K and another at 9K. I have noticed that a couple of the new cards go straight to 9 or 10K while my older cards are much less I assume becuase when I just started out with U.S. credit they started me very low and it takes longer to climb up but now that my credit is pretty good the new ones start me off at 9 or 10K.
Lastly, you hit on what I was asking regarding the premium - at least I got an opinion on what those cards are - not necassarly any one name, but rather ones from banks and I assume credit unions as well. I always here about Barclay and Discover and I have those two as well.
Thanks, this reply helped most (but thank you to most of the other guys/gales as well, you also helped!).
I think I'd like one or two more premium cards and will stick at that.
Dude...everyone knows it's 30!