How Many Credit Cards Are Really Needed

Anonymous · ‎09-27-2016

Hey guys, im really trying to figure out how many credit cards you really need to have. I currently only have 1 credit card with a CL of 20k. My Fico 8 scores are already pretty high Equifax - 734, Exp - 759, Trans - 760 and all of my other scoring models are high aswell, in the 750-800 range. My credit card is only 1 yr 10 m old and my aaoa is about 1 yr 2 m. I have 1 auto loan that i got 8 months ago at 7.19% which i think the dealer screwed me on (very stressful experience), but anyways it was my first time and i didnt know what i was doing. I just refinanced and was instantly approved for a 1.49% apr. I dont really need to use my credit for anything for a long time really until i get a home some day maybe im not sure. I know people will say you need multiple cc's but is that really true because my scores are already good. I dont have the need for any other cards and dont really want any but i want to have all the information about it. Will more cards really benefit me? What will they do that i already cannot? Any help is greatly appreciated, and i can answer any more questions needed, thanks.

SunriseEarth · ‎09-27-2016

@Anonymous wrote:
Hey guys, im really trying to figure out how many credit cards you really need to have. I currently only have 1 credit card with a CL of 20k. My Fico 8 scores are already pretty high Equifax - 734, Exp - 759, Trans - 760 and all of my other scoring models are high aswell, in the 750-800 range. My credit card is only 1 yr 10 m old and my aaoa is about 1 yr 2 m. I have 1 auto loan that i got 8 months ago at 7.19% which i think the dealer screwed me on (very stressful experience), but anyways it was my first time and i didnt know what i was doing. I just refinanced and was instantly approved for a 1.49% apr. I dont really need to use my credit for anything for a long time really until i get a home some day maybe im not sure. I know people will say you need multiple cc's but is that really true because my scores are already good. I dont have the need for any other cards and dont really want any but i want to have all the information about it. Will more cards really benefit me? What will they do that i already cannot? Any help is greatly appreciated, and i can answer any more questions needed, thanks.

One of the factors in scoring is UTIL. There is overall UTIL and UTIL for each card. However, scores also increase when half or more of your CCs have a zero balance. The only issue with having one CC is either a balance reports or it doesn't, so you can't ever have half of your cards with a zero balance.

Sicne you don't "need" credit, it might be good to get credit that can help you benefit from what you already spend money on. What CC do you currently have? What is your spend usually like in a month (i.e., where do you shop/spend)? Do you travel at all? Are you a member of any warehouse stores or do you have any other stores you like?

Anonymous · ‎09-27-2016

Based on a recent thread apparently people need 17 cards with plans to continuously app for 3-7 cards every year until their collection is complete, filled with SLs of $300-500

austinguy907 · ‎09-27-2016

Taking into account wanting to get a mortgage in the next few years potentially you'll want to have 3-5 CC's depending on the UW for the mortgage showing 1-2 years of activity. Right now you're sitting pretty well with the refi @ 1.49% and 20K line you have currently.

The reason behind the dealer rate sounds like you didn't have much in your profile to support a lower rate at the time and they probably didn't query any CU's for a lower rate. Standard auto finance at the dealer is min of 5% with the big banks to begin with since they're just doing them a favor sending them a new customer. Unfortunately in the auto game the best finance rates are on new vehicles where they're offering 0.0%-3.9% for whatever special of the month is going on. Let's chalk it up to a lesson learned and pre-qual with a CU before venturing into a dealer again.

My suggestion with adding 2 additional cards would be AMEX / Discover for diversification and growth of the CL's as time goes by. Both of them should pull EX to open and provide free monthly Fico's. Amex has the whole 3X CLI option at 61 days / 181 days after that and Discover does them after the first 90 days and both are SP for CLI.

If you find you really want something else after those you should be golden for decent opening limits.

Anonymous · ‎09-27-2016

I currently just have a NFCU Go Rewards. I maybe spend 500 a month and all of my spending is only food, mostly eating out and some groceries, although i would like to switch that around lol. I dont really spend much money and am more so trying to save money to pay for school upfront and to invest. So if i am to get another am i right to think just 1 other cc will be enough and just keep it a zero balance while still using it?

Anonymous · ‎09-27-2016

@Anonymous wrote:
Hey guys, im really trying to figure out how many credit cards you really need to have. I currently only have 1 credit card with a CL of 20k. My Fico 8 scores are already pretty high Equifax - 734, Exp - 759, Trans - 760 and all of my other scoring models are high aswell, in the 750-800 range. My credit card is only 1 yr 10 m old and my aaoa is about 1 yr 2 m. I have 1 auto loan that i got 8 months ago at 7.19% which i think the dealer screwed me on (very stressful experience), but anyways it was my first time and i didnt know what i was doing. I just refinanced and was instantly approved for a 1.49% apr. I dont really need to use my credit for anything for a long time really until i get a home some day maybe im not sure. I know people will say you need multiple cc's but is that really true because my scores are already good. I dont have the need for any other cards and dont really want any but i want to have all the information about it. Will more cards really benefit me? What will they do that i already cannot? Any help is greatly appreciated, and i can answer any more questions needed, thanks.

*** It all depends on what you think you need and want. If you are happy with one card, stick with it. If you need 2 or more, apply to a few credit cards. I personally enjoy having a collection of cards. It helps when there is an emergency and you desperately need money quickly! I also reccommend getting a bank card that you can also put on android pay, samnsung pay, apple pay. You have no idea how many times I've forgotten my wallet at home and my trusty phone was the only thing I got. I was hungry so I ran to Panera and paid for food with my phone! Anyways, I do hope that you app for a few!

Anonymous · ‎09-27-2016

It's really subjective and its all personal preference. I have a couple of cards, and I probably only really NEED 2, a main one and probably a back up card. But of course im a credit addict and credit cards is a hobby to me and for many on this board so everyone has a good amount of cards. To also answer part of your question, getting a couple of more cards can definitely raise your total credit available and help with your utlization and score. It's also nice to gain more than 1 card just to have a more solid and thicker profile and benefit from the rewards/cash/points for spending on stuff you were already going to spend on anyway.

Anonymous · ‎09-27-2016

Thanks austin, im guessing discover it since its no AF and revolving 5%, not sure which amex wud do me right.

Anonymous · ‎09-27-2016

Thanks for the input, my Util is currently 1% and i wud like to keep it there, if you charge less than 1% will it always round up and post as 1%?

austinguy907 · ‎09-27-2016

@Anonymous wrote:
I currently just have a NFCU Go Rewards. I maybe spend 500 a month and all of my spending is only food, mostly eating out and some groceries, although i would like to switch that around lol. I dont really spend much money and am more so trying to save money to pay for school upfront and to invest. So if i am to get another am i right to think just 1 other cc will be enough and just keep it a zero balance while still using it?

It all depends on your strategy for the next year, 3 years, 5 years, and so on. Since you don't have anything impending like buying a car / house or something that requires maintaining 750+ and inquiries don't hurt that much and would fall off at the same time. If you're going to take the hit with the new account(s) they might as well be at the same time so they age accordingly. The easiest way to gain a thicker file for down the road and maximum growth is to set a budget of 10% per card limit and just let it report and PIF through automatic payments.