Consumer Watch: How many credit cards is too many?

An Oklahoma City financial professional breaks down what may be too many credit cards (KOKH).

How many credit cards is too many? If you ask financial expert Melinda Warren with Hughes Warren Incorporated, her answer is cut and dry.

“I personally have one. So, I think it is just easier to manage,” says Warren.

There you have it, one credit card. If you have good credit, and also want a rewards card, that could work, but if you have concerns about creating more debt, stick to one, or maybe none.

“If you are in a situation where your credit has been damaged it is probably even more important to cut up that credit card, and get rid of it because it is too tempting,” says Warren.

It costs money to borrow money, and the longer it takes you to pay off, the more it will really cost, but if for whatever reason you are unable to make a total pay off, follow these tips.

  1. Have a plan. How long will it realistically take you to pay the debt? Making minimum payments may never get you there, and will cost a small fortune in fees.
  2. Keep your credit use at less than 30-percent of your available credit. This will keep it from affecting your credit score.
  3. Do not pay late. If you do, it will mean more fees, and depending on the card, it could spike your interest rate.

If you already have a couple of credit cards, and they are in good standing, do think twice before closing the accounts. Cutting your amount of open credit could lower your credit score. Instead, just put them away, and avoid using them to keep temptation at bay.

A common credit card misconception is that you need to carry a balance to keep your credit score high. That is not the case. Your account simply needs to be open and in good standing.

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