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How many credit cards should you have?

There’s no limit on how many credit cards you can have – the important thing is that you manage them responsibly.

For some people, one credit card could mean too much temptation to spend, while others may like having several to take advantage of rewards points or interest-free periods

Here are some factors that can help you make the decision about whether or not another credit card is a good idea.

What are the benefits of having multiple credit cards?

Credit cards can help build your credit history

If you haven’t borrowed before, it can be difficult for lenders to predict how likely you are to repay debts. Having a credit card or loan, and meeting your repayments, can help build your credit score by proving you’re reliable.

It can help to have extra funds on hand

Each credit card will have its own credit limit, which means you’ll have that money available should you need to spend it. This can give you confidence that if something costly happens you’ll be able to handle it. However, if possible, it’s a good idea to build an emergency fund to give you this added security.

Different types of credit cards can be used for different purposes

Used wisely, having multiple credit cards for different purposes can help you earn rewards points or take advantage of an interest-free period for a set amount of time.   

Explore: Types of credit cards 

Credit card purchases can be protected under Section 75

Using a credit card also means your purchases between £100 and £30,000 are protected under Section 75 of the Consumer Credit Act

If a retailer doesn't deliver your goods or goes bankrupt before you get what you paid for, for example, your card issuer will help you get your money back.

Things to consider when you have multiple credit cards

Temptation to spend on multiple credit cards

The more funds you have available, the more temptation you may have to spend. Keep that in mind before applying for any new credit card.

Everything you spend on a credit card will need to be paid back – possibly with interest if you don’t pay off the full balance each month – so it’s important to manage your spending habits

Explore: Tips for using your credit card 

Managing multiple repayments can be tough

If you borrow money on multiple credit cards, you’ll have to make multiple monthly repayments. This isn’t necessarily a bad thing, but it may increase the chance of you forgetting one. 

Setting up Direct Debits automates your payments – so you don’t have to think about them each month – and ensures your bills are paid on time to avoid late payment fees. 

Before taking out a new credit card, think about your current situation. Do you find making repayments time consuming or overwhelming? If so, it may not be a good idea to add another repayment. Or are you comfortable with the way you manage your money? If that’s the case, adding a credit card may not have much of an impact.

Explore: How to avoid credit card charges

You don't want to have too much credit on hand

When making a decision about whether to accept an application for a credit card or a loan, a lender may look at how much credit you already have available. 

If you have multiple credit cards, they may look at the credit limits on all of the credit cards combined rather than just the money you’ve borrowed. 

If you have multiple credit cards that are unused, this may also raise some questions and potentially impact your credit score. 

Can multiple credit card applications affect your credit score?

While it’s good to show lenders that you can successfully manage multiple credit accounts, applying for credit too many times can raise a few red flags. 

When you apply for a credit card, the provider will run a hard credit check on your credit report to see how reliable you are at borrowing and repaying money. 

If you apply for too many credit cards in a short amount of time, it can appear that you are struggling financially – and lower your credit score. This can affect your chances of being approved for credit in the future. 

Explore: How to improve your credit score

Should you get another credit card?

The right answer will depend on your circumstances and your money habits. These are some good questions to ask yourself:

  • Why do you want the card?
  • What will the benefit be?
  • Will it make managing money harder?
  • Will you be tempted to spend more?

How to transfer a credit card balance to another card

If you already have multiple cards and want to simplify your repayments and potentially save on interest, a balance transfer may suit you. 

A balance transfer credit card lets you transfer multiple balances onto one credit card - giving you a single monthly repayment and a period where you may not be charged any interest. This can give you some breathing space to help you manage your debt

Explore: How to use a balance transfer credit card