@Ladyk06 wrote:Hey there, no judgment just curious. What is the point in having 15, 20 and 30 CC's? I see people in here with a lot of cards and I'm just wondering why? Is it to be more credit worthy or just because you can? I'm not judging I'm just trying to optimize my credit worthiness. I have 7 cards totaling up to 100K. My scores are close to 800.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@Priory_Man First of all thank you for your service. I was just wondering because, I think I have enough credit but, I was just trying to get a solid grip on the 800 club. Currently I'm 3 points away on 2 Fico reports and 7 on the other. My utilization is 1%. I noticed that the people with the high credit scores have a lot of cc's and high combined CL's.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@SUPERSQUID
I totally get it. I had to file BK in 05. I had rental property, moved to another state and the person I trusted to manage it didn't. After that I kept hitting the luv button and acquired 14 cards. I was never late or missed a payment for 8 years. Well I ran into some major health problems and had to retire early from my good job. My house of cards came tumbling down again! 🙃 I didn't apply for another card for 7 years. Now I'm very cautious.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@Anonymous
Thank you for your comment. I feel the same way. I had this discussion with my husband who is probably up to 20ish cards now. (He's addicted to the wheel spinning, but surprisingly is in the 800 club) I told him that according to what I think I know, if he dies with cc debt and I sell the house, the proceeds will have to pay off his debt first.
This is a frequently-recurring topic that seems to pop up a few times every year, @Ladyk06. Reading your various replies and about your story, it does make me wonder what you're thinking about? You previously had more than 7 cards so now are you wondering if you should add more and if you're missing something? Or DH has a lot of cards and you're trying to understand him better?
There's been some good answers already and I could add a few more. Recapping the previous answers:
- Helps with utilization padding; the caveat is ... how much utilization padding is enough? Some of us can be addicted to just adding more "for safety."
On the other hand, we have some members who try to pad their utilization but are unable to get suitably large limits, so their solution is to keep adding more and more cards to pad utilziation instead of growing the cards they already have. - Age of credit file: Some of us keep older cards open due to the helpful age of older accounts in keeping AAoA high, even when adding new cards. (I have four cards that opened in 2000 or earlier and consider them anchors of my AAoA.) Also, some people with older accounts just don't close their older cards and keep adding more, perhaps never going through a financial crisis which pushes them to pare down.
- Hobby/enthusiast motitvation and for the "sport" of it. Yes, this fits a lot of us on My FICO. It's a pass-time that we enjoy, whether it's aiming for a high number of cards, a high TCL, experimenting with different lenders or rewards programs, or always looking out for the next big thing.
- SUBs. Many enthusiasts like to add cards for the SUBs and then may keep them around at least for awhile before closing, especially with some lenders like AMEX to prevent claw-back.
I'll add some other reasons:
- Diversification of lenders - to prevent any lender from having undue influence on your credit file if they pursue Adverse Action.
- Diversification of rewards - having multiple cards that pay equally well in the same rewards categories - for "back-ups."
- Perks - Some of our members with the most cards dabble in multiple travel points systems as well as cash back, to provide flexibility in earning rewards. These cards might all offer their own unique benefits such as elite status, free hotel nights, free checked bags, travel insurances, shopping protections, concierge services, etc. I believe this is often where you'll see some of our forum members branch out into more cards as they add general purpose travel points (AMEX MR, Chase UR, CITI TY) as well as airline or hotel cards.
- Business cards - some of our members have large business spend and want dedicated business cards to supplement their personal cards.
- Low APR and BT cards. We have some members with needs for periodic large balance transfers and they add multiple cards that help with those financing needs. Or some members who want the security of mulitiple "guaranteed" low rate cards for "just in case."
- Card synergies - Some card combos work well together earning points. For example, the earning structure on MR-earning AMEX cards might encourage having 2,3,4, or 5 MR-earning cards to accelerate accrual. On Chase cards, the "bi-fecta" "tri-fecta" and "quad-fecta" cards earning URs are similar. But still, one might want to not put all their eggs in that basket and keep some other rewards options such as cash or alternative points.
- Rewards enthusiasts - usually cash back rewards optimizers who try to get cards that give a high rewards rate in as many spending categories as possible, and perhaps having "spares" for those cateogies also, or sometimes because their primary card's spending cap is too low.
For most of my four decades in credit, I've had no more than a dozen cards but often less. I've gone through cycles of cleaning out and closing cards, and I've had lenders close my cards. It's only been since I joined My FICO a few years ago that I got over 20 cards. Even with closing some cards, I've continued to add some back. Long term, though, I know I don't want to continue to manage that many. I've been working on pumping up my limits on many cards so that I have the ability to keep a huge utilization pad while also being able to close some cards when I get ready to further simplify.
As noted upstream, managing multiple cards is easier if several of them are with the same lender, perhaps one where I also have deposit accounts.
@Aim_High wrote:
@Ladyk06 wrote:Hey there, no judgment just curious. What is the point in having 15, 20 and 30 CC's? I see people in here with a lot of cards and I'm just wondering why? Is it to be more credit worthy or just because you can? I'm not judging I'm just trying to optimize my credit worthiness. I have 7 cards totaling up to 100K. My scores are close to 800.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@Priory_Man First of all thank you for your service. I was just wondering because, I think I have enough credit but, I was just trying to get a solid grip on the 800 club. Currently I'm 3 points away on 2 Fico reports and 7 on the other. My utilization is 1%. I noticed that the people with the high credit scores have a lot of cc's and high combined CL's.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@SUPERSQUID
I totally get it. I had to file BK in 05. I had rental property, moved to another state and the person I trusted to manage it didn't. After that I kept hitting the luv button and acquired 14 cards. I was never late or missed a payment for 8 years. Well I ran into some major health problems and had to retire early from my good job. My house of cards came tumbling down again! 🙃 I didn't apply for another card for 7 years. Now I'm very cautious.
= = = = = = = = = = = = = = = = = = = =
@Ladyk06 wrote:
@Anonymous
Thank you for your comment. I feel the same way. I had this discussion with my husband who is probably up to 20ish cards now. (He's addicted to the wheel spinning, but surprisingly is in the 800 club) I told him that according to what I think I know, if he dies with cc debt and I sell the house, the proceeds will have to pay off his debt first.
This is a frequently-recurring topic that seems to pop up a few times every year, @Ladyk06. Reading your various replies and about your story, it does make me wonder what you're thinking about? You previously had more than 7 cards so now are you wondering if you should add more and if you're missing something? Or DH has a lot of cards and you're trying to understand him better?
There's been some good answers already and I could add a few more. Recapping the previous answers:
- Helps with utilization padding; the caveat is ... how much utilization padding is enough? Some of us can be addicted to just adding more "for safety."
- Age of credit file: Some of us keep older cards open due to the helpful age of older accounts in keeping AAoA high, even when adding new cards. (I have four cards that opened in 2000 or earlier and consider them anchors of my AAoA.) Also, some people with older accounts just don't close their older cards and keep adding more, perhaps never going through a financial crisis which pushes them to pare down.
- Hobby/enthusiast motitvation and for the "sport" of it. Yes, this fits a lot of us on My FICO. It's a pass-time that we enjoy, whether it's aiming for a high number of cards, a high TCL, experimenting with different lenders or rewards programs, or always looking out for the next big thing.
- SUBs. Many enthusiasts like to add cards for the SUBs and then may keep them around at least for awhile before closing, especially with some lenders like AMEX to prevent claw-back.
I'll add some other reasons:
- Diversification of lenders - to prevent any lender from having undue influence on your credit file if they pursue Adverse Action.
- Diversification of rewards - having multiple cards that pay equally well in the same rewards categories - for "back-ups."
- Perks - Some of our members with the most cards dabble in multiple travel points systems as well as cash back, to provide flexibility in earning rewards. These cards might all offer their own unique benefits such as elite status, free hotel nights, free checked bags, travel insurances, shopping protections, concierge services, etc. I believe this is often where you'll see some of our forum members branch out into more cards as they add general purpose travel points (AMEX MR, Chase UR, CITI TY) as well as airline or hotel cards.
- Business cards - some of our members have large business spend and want dedicated business cards to supplement their personal cards.
- Low APR and BT cards. We have some members with needs for periodic large balance transfers and they add multiple cards that help with those financing needs. Or some members who want the security of mulitiple "guaranteed" low rate cards for "just in case."
- Card synergies - Some card combos work well together earning points. For example, the earning structure on MR-earning AMEX cards might encourage having 2,3,4, or 5 MR-earning cards to accelerate accrual. On Chase cards, the "bi-fecta" "tri-fecta" and "quad-fecta" cards earning URs are similar. But still, one might want to not put all their eggs in that basket and keep some other rewards options such as cash or alternative points.
- Rewards enthusiasts - usually cash back rewards optimizers who try to get cards that give a high rewards rate in as many spending categories as possible, and perhaps having "spares" for those cateogies also, or sometimes because their primary card's spending cap is too low.
For most of my four decades in credit, I've had no more than a dozen cards but often less. I've gone through cycles of cleaning out and closing cards, and I've had lenders close my cards. It's only been since I joined My FICO a few years ago that I got over 20 cards. Even with closing some cards, I've continued to add some back. Long term, though, I know I don't want to continue to manage that many. I've been working on pumping up my limits on many cards so that I have the ability to keep a huge utilization pad while also being able to close some cards when I get ready to further simplify.
As noted upstream, managing multiple cards is easier if several of them are with the same lender, perhaps one where I also have deposit accounts.
Thank you for your in-depth analysis of my question. (I'm in college please write my paper! 😁) I was asking the question out of curiosity. I have never been in the 800 club and I'm approaching it slowly. I was wondering if I needed to add more cards or add to my utilization? I had 14 cards prior to my health issues and I was very distraught watching my good credit slowly diminish after working so hard to recover after a BK. My observation on here was that most people with 800 scores had a lot of cards. One of my concerns is also reducing my AAOA if I apply for new credit thereby, further dropping my score. I was just preapproved and acquired a Chase Sapphire Preferred card. That is the first card I apped for in 2 years. I think I'm kind of nervous about juggling too many cards because, I don't want to get in trouble with my cards again.
@Ladyk06 wrote:... Is it to be more credit worthy or just because you can? I'm not judging I'm just trying to optimize my credit worthiness. I have 7 cards totaling up to 100K. My scores are close to 800.
In my other post about why you see so many cards with some of our members, I realized I negelected to reply to the above portion of your posting, @Ladyk06.
There is a correlation between higher credit scores and file/consumer age. On average, FICO rises as consumers get older due to more total accounts, opportunity for more months of payment history, opportunity for rising income as finances change, and experience/maturity with managing finances. At the same time, consumers may tend to keep older accounts instead of closing them. So the appearance that more accounts = higher FICO is somewhat deceptive.
There is pop-up on Credit Karma suggests that 21+ accounts is needed to have an "Excellent" Vantage scoring metric for Total Accounts. See >this recent thread< where that discussion came up and a screen shot. That is misleading since 'total accounts' includes closed accounts that still report from the past decade, it includes (ALL) credit accounts (not only credit cards but mortgages, auto loans, personal loans, or student loans), it's a Vantage scoring metric, it has low impact, and Credit Karma would love to use that to try to market more card referrals to its' members for the referral fees. So that member mistakenly was planning to add 21 new credit card accounts as a goal based on that pop-up. The other problem with that 21+ is that it's not saying that 21+ is needed as much as statistics show that members with 21+ accounts have excellent scores. So it's a chicken-or-the-egg question. Did adding 21+ accounts lead to excellent scores? Or did naturally aging credit files, which pick up a mixture of many different credit types and new accounts over time lead to the excellent scores? The answer is more likely the latter.
@Ladyk06 wrote:Thank you for your in-depth analysis of my question. (I'm in college please write my paper! 😁) I was asking the question out of curiosity. I have never been in the 800 club and I'm approaching it slowly. I was wondering if I needed to add more cards or add to my utilization? I had 14 cards prior to my health issues and I was very distraught watching my good credit slowly diminish after working so hard to recover after a BK. My observation on here was that most people with 800 scores had a lot of cards. One of my concerns is also reducing my AAOA if I apply for new credit thereby, further dropping my score. I was just preapproved and acquired a Chase Sapphire Preferred card. That is the first card I apped for in 2 years. I think I'm kind of nervous about juggling too many cards because, I don't want to get in trouble with my cards again.
This is odd, @Ladyk06. Earlier today I didn't see your reply to me but it just popped up this evening. A few hours ago, I wrote an addendum to my message which might help to answer your question better about number of cards versus high FICO. (See message 45 above.)
Especially for those who have weathered a financial storm, adding cards may be intimidating and that's perfectly natural. Perhaps even a healthy instinct! But like any healthy instinct, it can sometimes err to the extreme. I'd advise proceeding at a rate with which you're comfortable, and know that your current (7) cards is more than enough to reach the perfect 850. Now, of course, managing utilization is important and there are some recognized "thresholds" for credit scoring breaks. The ideal range to maintain for both individual cards and aggregate utilization is between 1% and 8.9%. (See >THIS THREAD< for more information as well as a link back to earlier forum archives on this topic.) If you need a higher TCL (Total Credit Limit) across all cards to manage utilization, I'd normally suggest working your current cards as hard a possible to grow the limits. This is especially true if you're averse to too many total accounts. If you're not familiar, learn the CLI policies and patterns for all your lenders such as HP/SP, how often you may request, if heavier spending is needed to grant an increase, etc. For Soft Pulls, set a reminder to keep asking for increases (normally about every six months.) If you find you exhaust all CLI opportunities, then perhaps try adding additional credit lines if you need them. If the BK or any derogs such as late payments or collections are still showing, your score will continue to rise as they age or eventually drop off. The tricky part for you rebuilding is that medical retirement and, I would imagine, not having current earned income. If you're like most people, you probably have less income than when you were working, and income significantly affects the ability to increase credit limits. Mixture of credit is also a factor; if you don't have any current installment debt such as mortgages or car loans, that will slightly inhibit the ability to reach the full 850. Not that debt is good, but it's part of the equation.
Congrats on the Chase Sapphire Preferred! It's a great card. Chase now allows SP CLI requests. They do like to see regular activity on their accounts to grant increases but they can grow.
What I've found that works well for pursuing a CLI is to temporarily disregard the specific rewards rates and how I would usually use my cards. Instead, I will sometimes focus most or even all spend on a card for a few months prior to requesting an increase! Then after I succeed, move on to another card and do the same with it. You may forgo some rewards, but in the end the trade-off for higher CLs is worth it, IMO.
But if you're not carrying any debt, there's no real need to get those higher limits if utilization is in check. Higher limits don't equate to higher FICO. They only relate to FICO as a utilization element. So at that point, it just becomes a question of time and the waiting game for scores to slowly rise as responsible payment history is established with each lender. As payment history increases and all inquiries and new accounts age beyond 24 months, your scores will likely increase. If you're happy with your (7) cards, then keep them and enter the "garden" as we call it (where we tend to the cards we have and abstain from new hard inquiries and new accounts.)
@Aim_High wrote:
@Ladyk06 wrote:... Is it to be more credit worthy or just because you can? I'm not judging I'm just trying to optimize my credit worthiness. I have 7 cards totaling up to 100K. My scores are close to 800.
In my other post about why you see so many cards with some of our members, I realized I negelected to reply to the above portion of your posting, @Ladyk06.
There is a correlation between higher credit scores and file/consumer age. On average, FICO rises as consumers get older due to more total accounts, opportunity for more months of payment history, opportunity for rising income as finances change, and experience/maturity with managing finances. At the same time, consumers may tend to keep older accounts instead of closing them. So the appearance that more accounts = higher FICO is somewhat deceptive.
There is pop-up on Credit Karma suggests that 21+ accounts is needed to have an "Excellent" Vantage scoring metric for Total Accounts. See >this recent thread< where that discussion came up and a screen shot. That is misleading since 'total accounts' includes closed accounts that still report from the past decade, it includes (ALL) credit accounts (not only credit cards but mortgages, auto loans, personal loans, or student loans), it's a Vantage scoring metric, it has low impact, and Credit Karma would love to use that to try to market more card referrals to its' members for the referral fees. So that member mistakenly was planning to add 21 new credit card accounts as a goal based on that pop-up. The other problem with that 21+ is that it's not saying that 21+ is needed as much as statistics show that members with 21+ accounts have excellent scores. So it's a chicken-or-the-egg question. Did adding 21+ accounts lead to excellent scores? Or did naturally aging credit files, which pick up a mixture of many different credit types and new accounts over time lead to the excellent scores? The answer is more likely the latter.
@Aim_High, I'm not sure about the statement that "statistics" show that "members with 21+ accounts have excellent scores." If it is easy for you to provide a link regarding the statement, I think it would be interesting reading.
@Gollum wrote:
@Aim_High wrote:... it's not saying that 21+ is needed as much as statistics show that members with 21+ accounts have excellent scores. So it's a chicken-or-the-egg question. Did adding 21+ accounts lead to excellent scores? Or did naturally aging credit files, which pick up a mixture of many different credit types and new accounts over time lead to the excellent scores? The answer is more likely the latter.
@Aim_High, I'm not sure about the statement that "statistics" show that "members with 21+ accounts have excellent scores." If it is easy for you to provide a link regarding the statement, I think it would be interesting reading.
I feel like we're opening a bucket-of-worms here, @Gollum, but I'll make an effort to answer your question and let you know what I was thinking.
Just to reiterate before I get started, I'm not saying that a certain number of accounts is necessary to achieve a high FICO (or) Vantage credit score. My point was that, on average, when comparing a profile with 21+ accounts versus a much lower number, there very well (MAY) be a statistically significant correlation. In other words, you may find many more high scores in profiles with 21+ and less high scores in 10 or less, but it's correlation not causation. Adding accounts doesn't raise score by itself. It's just a by-product of a healthy credit file. Keep in mind that those 21 accounts probably aren't just currently open revolving credit accounts. They would also include all closed credit accounts of all types including credit cards, mortgage, auto loans, student loans, personal loans as well as current loans of all types. And they were likely accrued (for most consumers) in a slow natural process over time. This is where the credit age factor I showed in the table becomes relevant. I will offer postings from my own Credit Karma as a reference. My TU and EQ Vantage Scores are 850. I have (47) total accounts; however, only (19) of those are currently open. Credit Karma advises this is a low impact on my Vantage score, not to worry about the exact number as much as managing accounts responsibly, but then when it offers to "rate" my accounts suggests that 21+ is excellent. (See screenshots.)
In a nutshell, do I have a single link to some statistical profile to back that statement? No. I probably should have clarified that I was making more of a broad assumption about Credit Karma's reasoning on posting that 21+ figure, but also based on my own evaluation of inferred data related to the topic and my own experience. Somewhere, there probably is data making a direct correlation between number of accounts and credit score, but I don't believe it's publicly available. The problem we get into with a lot of these credit scoring factors is that the precise methodology, which is undoubtedly based on decades of those credit bureau statistics, is propriety (FICO = Fair Isaac and Vantage = EX/EQ/TU). As much as Credit Karma is disrespected on My FICO, I don't think they just pulled a number out of thin air when they posted their ranges. While they aren't directly privy to either exact FICO or Vantage scoring methods as a third party, perhaps they got inside information or did their own statistical analysis in how factors are weighted. My statement was a supposition that CK made their claim based on some actual data. I may be wrong.
Let's look at FICO Scoring Factors on Experian and compare that to Vantage Scoring Factors discussed on Credit Karma as well as the Vantage Score Press Release. Both FICO and Vantage include Average, Oldest, and Youngest accounts as well as Account-type Mix. FICO: Credit History Length - 15% and Account Mix - 10% for a total of 25%. Vantage 3.0: "Depth of Credit" which combines both of these elements - 21%. As a student of statistics learns, an important consideration is sample size. The more data points available, the more accurate the analysis. So it would seem likely to me that when Vantage 3.0 was formulated, they might slowly reward profiles with larger data fields with the opportunity for a higher score. Why? Because more data allows increasing certainty of the accuracy of predicting credit risk, and that's what credit scores are all about. Perhaps FICO does the same thing. Again, this is my own observations and analysis.
It makes sense that not only do older consumers have higher FICO on average, but the evidence indicates that they likely also have more credit file entries. Older consumers are more likely to have that full 10 year (or more in some cases) look-back on closed accounts as well as much older open accounts. (For just one example, I currently have an account still included on my EQ file that was closed 15 years ago.)
Consumers tend to have more revolving credit accounts as they age. Keep in mind this is just open credit accounts. Link
Homeownership: Approximately 65% of Americans are homeowners. Over 75% of homebuyers finance their homes. The average American owns three homes in their lifetime. Older consumers (ie - higher average credit score) are likely to have current and/or prior mortgage loans. Link 1; Link 2
Auto Loans: In 2022, about 80% of new cars and 40% of used cars were financed instead of purchased with cash. While this table isn't tabulated by age, older consumers (ie - higher average credit score) would be likely to have current and/or prior auto loans. Link
Taken as a whole, IMO the rising credit scores by consumer age appear to be at least somewhat linked to a higher number of various open/closed credit accounts.