09
Aug

multiple credit cards

We all lead busy lives, and as active consumers, we tend to accumulate a smorgasbord of credit cards as we go along.

Some pick and choose their cards for attractive interest rates, or will use a specific card just for business expenses – or to rack up the airline miles with their purchases. Others have cards they may have opened at a department store for a discount, and hold onto, but don’t necessarily use on a regular basis.

Considering that Americans are approaching almost $1 trillion in collective credit card debt, it’s important to exercise a sense of financial hygiene when it comes to managing your multiple accounts, and making sure too many active cards don’t turn into a negative on your credit report. Here are some strategies:

Be Mindful of Your Utilization

While it’s great to have a handful of cards with high credit limits, consider the impact that carrying balances on several cards can have on your overall credit utilization score – one of the major factors that goes into your credit report.

Ideally, cards should carry a balance that’s less than 30 percent of their individual credit limit, but credit agencies also consider your total pooled credit resources, so even smaller balances can be a potential negative. Keep an eye on what you owe, and strive to pay things in a timely fashion. That’s all the more difficult if you’ve got lots and lots of cards active at the same time.

Make It Easy On Yourself

You’ve got your reasons for using all those different cards, but keeping track of the monthly bills can be a hassle, even in a world of online payments and paperless statements. Too many cards with different due dates can result in the occasional late or missed payment – despite all the email alerts – so consider limiting the breadth of your card use.

Instead, pick a card that’s going to do the most good – one with a low APR or an aggressive arrangement for cash or travel point rewards – and figure out a way to pay off as much of the balance as possible on a monthly basis. Treat that credit like you would cash, and you’ll lessen the chance of missing or forgetting a payment, and also boost your credit score in the process.

Invest in Some Financial Software

If you still like the feeling of a thick wallet, think about getting some help in electronically tracking those balances and keeping on top of what you owe. Apps from companies such as Venmo, Bankrate or Mint can easily track what you owe, when you need to make payments and keep an eye on how much of your overall resources you’re using. That can be helpful for even the most enthusiastic card-hoppers out there.

If your vigorous credit card usage has also caused some issues, considering turning to an expert on credit repair.

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