A question that has probably been floating around your head while deciding to apply for a new credit card and maybe even taking your credit score into account during the process. There is no clear answer because there are simply too many variables to consider. There are ranges, it seems, which ultimately depends on an individual’s financial status. Here’s a great video from Credit Card Insider that may shed some light on the matter.
But what about my credit score?
So many factors may affect your credit score and the number of cards you have may only have a small influence depending on other factors such as loans, mortgages and your debt to credit ratio.
There’s a neat article over at Lifehacker.com titled “How Many Credit Cards Should I Have?” which is worth reading. Here’s an excerpt which suggests a rule of thumb:
To give you a guideline of how many credit accounts is considered good for us normal people, Mint’s credit reporting tool tells me 0-5 accounts is “poor.” 6-12 is “not bad,” 13-21 is “good,” and 22 or more accounts (open or closed) is “excellent.” Again, though, that’s for all types of credit and for just a small slice of the credit score pie. – Lifehacker.com
These are just insights from other various sources which will hopefully encourage you to research and take inventory of your own individual financial situation when deciding if adding another credit card or perhaps even another form of credit to your list is a good idea or not.
What are your experiences?