Do You Own Too Many Credit Cards? MoneySmart Philippines (2020)

Do You Own Too Many Credit Cards? MoneySmart Philippines (2020)

Should you have just one or several credit cards? If you’re the type of person to be swipe-happy whenever they go somewhere with anything for sale, whether online or offline, the answer is a hard no.

But for everyone else who can keep their credit card spending in control, the answer may not come so easily. After all, there are advantages to having more than just one credit card.

So, is it okay to have more than one credit card? And how many cards is too many? Let this  MoneySmart article answer all your burning questions!

On the subject of having many credit cards

There are upsides and downsides to owning several credit cards, and we all can agree that they can be good or bad to your credit score, depending on your credit card usage and ability to pay.

They have different features and benefits

Think of credit cards as an instrument that we all need sometimes to help us with our specific cash problems.

For example, travel credit cards can be a plus to have if you want to maximize your travel expenditures, such as airline tickets, hotel accommodations, or admission tickets.

If you always use a credit card for your groceries, fuel, utility bills, or dining and entertainment, it would be good to have a rewards or cashback credit card for these kinds of spending as well.

They can keep a low credit card utilization ratio

Having only one credit card means charging all purchases to it and even maxing it out. This will impact your credit utilization score.

But if you have several credit cards, you can achieve an ideal utilization ratio. Say, 50% of the cards’ credit limits.

They build your credit score

If you have several credit cards and pay off your full balance on time, you are building a good credit score. Your creditworthiness goes higher, giving you more access to credit opportunities in the future when you need them.

They increase your credit limit

Every card has a different credit limit. The more cards you have, the higher combined credit limits you will get. This can come in handy when you meet a financial emergency or fall through hard economic times.

You receive more rewards and cashback

When you have several credit cards, you get access to more rewards and benefits in the form of waived annual fees, bonus or reward points, miles, or cashback. This will depend on the type of credit cards you have.

The cons of having many credit cards

The appeal is having several credit card options depending on the type of purchase you will make. But if you’re not careful, this can make you lose track of your spending, and all your efforts to carefully manage your expenses will all be for nothing.

They tempt you to spend more

Ever notice how it’s so much easier to swipe your credit card than part with cash in your wallet? When you can’t see money leaving your hands, it feels like you’re not spending at all.

And it’s very easy to condition yourself to spend more with your credit cards if you want to get more rewards. With this, you can fall into more debt and pay more fees and interest charges.

The financial responsibility gets bigger

Owning many credit cards comes with the huge risk of overspending and having unnecessary debts. It’s never good to carry a high balance in all your credit cards.

If you have several credit cards, you need to keep track of each one’s billing cycle, which can get pretty overwhelming and stressful.

And if you miss payments or max out your credit cards, it will have a negative impact on your credit scores as well.

So how many credit cards should you have?

If you use your credit cards responsibly and never carry a very high balance on each one, you can have as many credit cards as you want.

As long as you can pay in full and on time, you can have as many credit cards as you need.

Every credit card application is reviewed and approved separately by banks anyway. If you get approved for all your credit card applications, it means that you are creditworthy.

However, if you’re using your credit cards to supplement your monthly income, then having many credit cards is not advisable. You will only be carrying your balances month after month and accruing interest and other charges.

It would be ideal to get 2 or 3 credit cards with different features. Get one that you can use for travel-related expenses, one for regular and everyday spending, and one for online shopping. This way, you can easily track your expenses and optimize your reward or bonus points.

If you have your own business, it would be wise to get one credit card for your personal use and another one for business use.

Final Thoughts

Even if you have just one credit card or five, the main goal is to avoid having debts as much as possible.

It does not matter how many credit cards you own. The important thing is how well your credit cards are managed and how prompt your payments are made.

The better you are at paying off your credit card balance, the more benefits and rewards you will receive, and the more you will improve your credit score.

Choose credit cards that you will use heavily so you can get the most rewards and savings. Also remember that just because you have a high spending limit does not mean you should spend on anything you fancy!

When done right, owning several credit cards will not only give you spending power and an enhanced lifestyle but also an impressive credit rating.


Do you have multiple credit cards? Which cards do you have, and where do you use them? Share your answers in the comments!