How many CC's is enough?

[Cdnewmanpac]

While there is no question that getting at least 3 cards helps your score and looks better to underwriting, the evidence that >5 hurts you is less clear. A lot of it has to do with which "bucket" fico assigns you to. I've seen guys with enough cards they need a spreadsheet and 800+ FICOs. Generally, the impact of each card >3 on FICO appears to diminish as both your oldest account and AAoA increase. Also, the difference between 3 and 4 is much bigger than the difference between 12 and 13.

But remember that the value of a FICO score is in giving you access to credit. If you forego credit that would benefit you in order to increase a score that, by itself, is meaningless, you've defeated the purpose of raising the score. 4 cards may be "too many" for someone, while "not enough" for others. Personally, I hope to eventually end up with: a low interest card, a travel/rewards card, a hotel card (for perks), an airline card (for perks), a rotator and a no ftf card that I use only overseas when I'm worried about fraud. But that's me. I don't want to overdilute my rewards, so having a citi TYP, a CSP and a PRG wouldn't work for me. I'd rather have 40k in UR points than 15k in UR, 20k in MR and 5k in TY. But if I was spending 200-300k/year on travel, that might be fine.

[zeusta20]

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@Cdnewmanpac wrote:

While there is no question that getting at least 3 cards helps your score and looks better to underwriting, the evidence that >5 hurts you is less clear. A lot of it has to do with which "bucket" fico assigns you to. I've seen guys with enough cards they need a spreadsheet and 800+ FICOs. Generally, the impact of each card >3 on FICO appears to diminish as both your oldest account and AAoA increase. Also, the difference between 3 and 4 is much bigger than the difference between 12 and 13.

But remember that the value of a FICO score is in giving you access to credit. If you forego credit that would benefit you in order to increase a score that, by itself, is meaningless, you've defeated the purpose of raising the score. 4 cards may be "too many" for someone, while "not enough" for others. Personally, I hope to eventually end up with: a low interest card, a travel/rewards card, a hotel card (for perks), an airline card (for perks), a rotator and a no ftf card that I use only overseas when I'm worried about fraud. But that's me. I don't want to overdilute my rewards, so having a citi TYP, a CSP and a PRG wouldn't work for me. I'd rather have 40k in UR points than 15k in UR, 20k in MR and 5k in TY. But if I was spending 200-300k/year on travel, that might be fine.

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Makes a ton of sense. Thank you for your post! Definitely helps.

[webhopper]

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@zeusta20 wrote:

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@webhopper wrote:

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@zeusta20 wrote:

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@webhopper wrote:

I have 6, which is too many... but they serve a purpose...

Navy Fed, just to have a nice limit and some cash back rewards, low APR, and nice BT offers.

Discover,  keep it open due to account history and because its my oldest account.  Cash back is nice, as is Shop Discover and Discover Travel Desk.  Impeccable customer service... a good card.

Amazon... Amazon rewards 3% on amazon, 2% on gas, drugstores, and restaurants.   This is my restaurant and Amazon card.

Lowes...  Lowes rewards 7%, and to keep business expenses sepearate from personal,  the limit is much higher than I need, but oh well.

PRG...  groceries, gas, and travel rewards... all are things my family does a lot of...   also, NPSL, so I can charge as much as I need to in order to take care of things. My annual spend is over 30k gets me a 15000 MR point bonus.

Zync... nostalgia, and an open positive tradeline to help my husband re-establish good credit.

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Wait....am I missing something. How can spending over 30k get you 25K bonus points? Is there an annual bonus for the PRG? If so, I had NO IDEA. And I look this card up frequently as I'm thinking about converting to that card. Just not sure if the AF is worth it.

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Yes, there is an annual bonus of 15000 MR points if your annual spend exceeds 30k.   Last year my Zync spend was 40k, so I decided to pick up PRG and go after those poitns.

In my opinion you should upgrade Green to PRG, and downgrade CSP to plain Sapphire.     That's what I would do if I were to change your wallet to fit my needs without opening or closing any accounts.

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now...another question for you...(sorry for all the questions.lol.)

I just looked up the airlines that i'm able to transfer points to. And normally I fly united, which is NOT a partner of amex it looks like. If I were to upgrade, would I be able to have more choices to transfer airline miles to?

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For Airlines, you can pay with points, or you can transfer to Aeroplan, which is a United Partner 

[zeusta20]

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@webhopper wrote:

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@zeusta20 wrote:

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@webhopper wrote:

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@zeusta20 wrote:

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@webhopper wrote:

I have 6, which is too many... but they serve a purpose...

Navy Fed, just to have a nice limit and some cash back rewards, low APR, and nice BT offers.

Discover,  keep it open due to account history and because its my oldest account.  Cash back is nice, as is Shop Discover and Discover Travel Desk.  Impeccable customer service... a good card.

Amazon... Amazon rewards 3% on amazon, 2% on gas, drugstores, and restaurants.   This is my restaurant and Amazon card.

Lowes...  Lowes rewards 7%, and to keep business expenses sepearate from personal,  the limit is much higher than I need, but oh well.

PRG...  groceries, gas, and travel rewards... all are things my family does a lot of...   also, NPSL, so I can charge as much as I need to in order to take care of things. My annual spend is over 30k gets me a 15000 MR point bonus.

Zync... nostalgia, and an open positive tradeline to help my husband re-establish good credit.

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Wait....am I missing something. How can spending over 30k get you 25K bonus points? Is there an annual bonus for the PRG? If so, I had NO IDEA. And I look this card up frequently as I'm thinking about converting to that card. Just not sure if the AF is worth it.

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Yes, there is an annual bonus of 15000 MR points if your annual spend exceeds 30k.   Last year my Zync spend was 40k, so I decided to pick up PRG and go after those poitns.

In my opinion you should upgrade Green to PRG, and downgrade CSP to plain Sapphire.     That's what I would do if I were to change your wallet to fit my needs without opening or closing any accounts.

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now...another question for you...(sorry for all the questions.lol.)

I just looked up the airlines that i'm able to transfer points to. And normally I fly united, which is NOT a partner of amex it looks like. If I were to upgrade, would I be able to have more choices to transfer airline miles to?

---

For Airlines, you can pay with points, or you can transfer to Aeroplan, which is a United Partner 

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Hmmm...ANOTHER new thing I learned today! I love this...haha.

I guess there's so many different ways to be rewards, you just gotta know the ins and outs. Thanks. Now that I know that, I don't have a problem using amex now. Thats one of the main reasons why I wanted the CSP was because not only for the 40k bonus points, but because they partner with UA, and I fly through them. DIdn't know that Aeroplan was a partner though.

[BlueNightStar]

My personal preference is for cards from mupltiple issuers so I am covered if anything changes on one of my cards. I've seen a lot of changes in cards and banks over the last ten years. I will eventually have three cards from my current CUs in addition to the usual rewards cards. Of course the CU rewards are usually below that of prime bank CCs but they are also very generous with higher CLs and lower interest rates. They are also more willing to work with you if you run into problems and less likely to take AA. I've come to realize that it's not always about the bottom line of rewards, it's a mix so I'm covered for when life and banks change.

I currently have 10 cards and have no trouble managing them. My goal is 15, including a few store cards.

[LS2982]

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@drkaje wrote:

Once they're paid off and I'm financially stable, the perfect number will be three. An Amex, Visa, & MC. My remaniing cards will be closed or shredded.

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Noticed Discover isn't in that mix..........................??

[bs6054]

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@BlueNightStar wrote:

My personal preference is for cards from mupltiple issuers so I am covered if anything changes on one of my cards. I've seen a lot of changes in cards and banks over the last ten years. I will eventually have three cards from my current CUs in addition to the usual rewards cards. Of course the CU rewards are usually below that of prime bank CCs but they are also very generous with higher CLs and lower interest rates. They are also more willing to work with you if you run into problems and less likely to take AA. I've come to realize that it's not always about the bottom line of rewards, it's a mix so I'm covered for when life and banks change.

I currently have 10 cards and have no trouble managing them. My goal is 15, including a few store cards.

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That is a very good point, two of my "great" cards recently got nerfed to "just OK"  (BCP and US Bank Cash Plus).

I'm with the consensus that it is a personal decision, i.e. as many or as few cards as you feel comfortable with.     And be aware of diminishing returns:  it's very tempting to add card X that fills a critical gap (you get 6% off Danish books with a dark red cover, on Tuesdays in Denver) but as you add cards, the amount you spend on these niche products becomes small, and the corresponding gain is much less.  The counterexamples are/were things like Bill Pay with Cash Plus, where suddenly a high-spend area becomes available for rewards, and these should be snatched up ASAP, because we know what happens to such gifts!

[DaveSignal]

I have 11 open revolving tradelines.  That is too many for me.  I only actually use 5 them.  And of those 5, only 1 that I use every day.   But no, you don't need many open credit cards for a good credit report.... I would say 2 or 3.  More cards does help a bit with utilization though.

[LS2982]

I have 17 open TL's. I love managing them daily. Have 2 more cards in mind for next year then its a deep hibernation for me!

[BlueNightStar]

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@bs6054 wrote:

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@BlueNightStar wrote:

My personal preference is for cards from mupltiple issuers so I am covered if anything changes on one of my cards. I've seen a lot of changes in cards and banks over the last ten years. I will eventually have three cards from my current CUs in addition to the usual rewards cards. Of course the CU rewards are usually below that of prime bank CCs but they are also very generous with higher CLs and lower interest rates. They are also more willing to work with you if you run into problems and less likely to take AA. I've come to realize that it's not always about the bottom line of rewards, it's a mix so I'm covered for when life and banks change.

I currently have 10 cards and have no trouble managing them. My goal is 15, including a few store cards.

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That is a very good point, two of my "great" cards recently got nerfed to "just OK"  (BCP and US Bank Cash Plus).

I'm with the consensus that it is a personal decision, i.e. as many or as few cards as you feel comfortable with.     And be aware of diminishing returns:  it's very tempting to add card X that fills a critical gap (you get 6% off Danish books with a dark red cover, on Tuesdays in Denver) but as you add cards, the amount you spend on these niche products becomes small, and the corresponding gain is much less.  The counterexamples are/were things like Bill Pay with Cash Plus, where suddenly a high-spend area becomes available for rewards, and these should be snatched up ASAP, because we know what happens to such gifts!

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Totally agree with you on the diminishing returns, something I've come to understand in the last six months as I've finally been eligible for rewards cards. It does help curb random apping to really look at what you will be getting in terms of acutal rewards vs. the amount spent. That's one of the reasons I don't mind charging a few things on my CU cards even though the rewards are not fantastic - long term I'm better building that relationship than chasing the niche card that may only really get me a few dollars in rewards. Nothing like two years of 30% penalty interest on a big bank card I couldn't PIF back in 2009 to make me really value a lender that is going to work with me if times get a little rough.