Yes, You Need More Than One Credit Card
Americans cite many reasons why they need only one card. One of the major reasons is that they’re afraid of the temptation presented by multiple lines of credit. If they have more credit, they might use it.
This is a valid concern, and those who cannot resist spending probably shouldn’t have any credit cards. But life is certainly safer and more convenient when you do.
Some experts recommend keeping one credit card with a zero balance – and keeping it in a safe deposit box for emergency use only – such as after a robbery or house fire. This was probably good advice before the banks began closing unused accounts. Now you do need to take the card out and use it at least quarterly or you’re apt to find it has disappeared.
Keeping one credit card exclusively for on line purchases is a safety feature as well. Should your account be compromised, you’ll know which card numbers were stolen and can take action quickly. It’s also easy to spot a bogus charge on a statement with few entries.
Rewards are another good reason for multiple accounts, because different cards offer different rewards. A consumer who plans ahead and keeps track of offers can reap good rewards by using the correct credit card for each purchase.
Along with the rewards, keeping like purchases together on one card helps with record-keeping. It also makes it instantly clear to you if you’re spending more than normal on some part of your budget and need to cut back. Seeing 8 separate charges at the local CD outlet, movie theater, or restaurant might tell you that you’re indulging yourself a little too much!
Multiple cards also boost your credit scores - as long as you keep use under control. Don’t let your charges on any one card rise above 30% of the credit limit in any one month. If you slip and go above the 30%, go on line and make a payment before your next statement date. Of course, having multiple credit cards and credit lines makes it easier to keep a low balance on each of them.
For many, having multiple cards with different due dates makes budgeting and bill-paying easier.
Lastly, if you have multiple cards and one card issuer suddenly decides to cut your credit line or raise your interest, you’ll have somewhere else to turn. You can even transfer balances if another credit card has friendlier terms.
