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@Anonymous wrote:I have been poking around here on the forums for a while and have noticed something that surprises me. There seem to be a lot of people who have a lot of credit cards. Is there some advantage to having 10+ cards including bank and store cards versus having just a few cards? Frankly, I am pretty happy with what I have as they meet my needs. I am interested if there is something I am missing.
Really no advantage to store cards from a credit score perspective. I have one store card from BB only because I buy a lot from BB and the cash back $$ for future purchases can't be beat. I also have one charge card from American Express. Don't use it much but it is my oldest account (from 1984) - so I keep it active. A single charge card may help with "credit mix" but I suspect not. The big boost for credit mix is an installment loan/mortgage.
I have a total of six open credit/charge cards which is more than enough for achieving top scores. No need for 10 or more cards.
However, you do want enough cards (say 5) to achieve a significant combined (aggregate) credit line. Aggregate utilization % does impact score and it is best to maintain that below 9% month to month. A "high" aggregate CL helps mitigate score fluctuations if you allow non trivial balances to report.
Some people have baddies on their credit report, and they will be stuck with them for 7 years. It can be advantagous to add new, clean tradelines to 'dilute' the unclean ones And if one clean addition is good, several clean additions is even more so, right? Well, maybe. And if all they can get are store cards and gas station cards and secured cards, well, at least the store and gas station cards don't require deposits.
Then there are people who see good sign up bonuses, like the 60,000 points I'll be getting from my Citi Premier card. But, adding a new card will really reduce your average age of accounts, unless you have lots of cards because then the average of say a dozen cards each many months old plus one card that is 0 months old, is still a large average. In this case you really don't want a large number of store cards, instead you want cards that actually have advantages for you (5% cash back, sign up bonuses, or a card from a company that allows you to combine credit card limits, etc).
In my case, I have many cards that give me 5% cash back on just about all my spending categories except Drug Stores, Rent and Utilities (other than cell phone). I now have 2 cards with $30K limits, one of which is an American Express. And I have a card that doesn't have great benefits at all, but is from a bank I'm planning to use a lot, so I decided to also get one of their credit cards (rather than using their debit card in an emergency). And I have a card with a really nice sign up bonus, that barely dented my average age of accounts
Basically a lot of credit lines on a credit report makes for a stronger report. Just as experience with large credit limits over time without carrying balances demonstrates that you can handle those types of limits. You don't have to do any of that, but since you are reading at least one credit card information site, you're likely to encounter the occasional great sign up bonus or great cash back opportunity, so why not be ready to take advantage of them?