How many credit cards should you have?
According to the Financial Conduct Authority (FCA), 64% of UK adults have at least one credit card. But, in theory, there’s no limit to how many credit cards you can have.
Whether it’s good to have multiple credit cards depends on how responsibly you manage them.
Here’s what to consider when deciding how many credit cards you should have.
According to the Financial Conduct Authority (FCA), 64% of UK adults have at least one credit card. But, in theory, there’s no limit to how many credit cards you can have.
Whether it’s good to have multiple credit cards depends on how responsibly you manage them.
Here’s what to consider when deciding how many credit cards you should have.
Why do I need a credit card?
It’s not essential to have a credit card. But spending on at least one card could help you build your credit score.
A credit card could show lenders that you can manage your finances responsibly by:
- Making your repayments on time each month
- Not exceeding your credit limit
- Maintaining a low credit utilisation rate.
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Used sensibly, a credit card is a great way to build a decent credit profile. This could give you access to better mortgage and loan rates in the future.
Depending on the credit card, you could also benefit from rewards or 0% interest for a set period to help spread the cost of big purchases.
But if you’re struggling to stay on top of your finances, a credit card might not be right for you. Once you start spending, it can be all too easy to just let your plastic friend pay, then worry about it later.
To avoid paying interest, you’ll need to pay the entire balance each month. At the very least, you’ll need to make the minimum payment when it’s due. If you do only make the minimum payment, you’ll be charged interest on the remaining balance.
If you’re worried that you’ll overspend then struggle with the repayments, a credit card may do you and your credit score more harm than good.
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Did you know? According to a report by The Money Charity, the average credit card debt per household in June 2024 was £2,495. |
Is it good to have multiple credit cards?
It could be good to have multiple credit cards – if you know how to manage them.
Different credit cards can have different features and functions. So, in some cases, you may benefit from having more than one credit card.
For example, you may have a standard credit card for everyday expenses. But if you need to cover a big purchase such as a wedding or new boiler, a 0% interest purchase credit card could help you spread the cost without added interest.
You’ll need to make at least the minimum repayment each month, though, and pay off what you owe before the 0% period ends.
Or maybe you travel a lot. In this case, a dedicated travel credit card could help you save money on foreign transaction and exchange fees.
The benefits of having more than one credit card also include:
A boost to your credit score
If you can manage each card responsibly, it shows lenders that you’re creditworthy. This will improve your credit rating and could give you access to better loan terms in the future.
Spreading your spending over multiple cards may also enable you to keep your credit utilisation low. This will also have a positive impact on your credit score.
Extra funds when you need them
Each credit card has its own credit limit, so you’ll have money available should you need it. Multiple cards provide you with a financial safety net if there’s a costly emergency you need to pay for upfront.
Before you use a credit card for an emergency, be sure you’ll be able to pay back what you owe.
Different features
You could enjoy the benefits of different cards based on your lifestyle needs, such as air miles, cashback or store vouchers.
Just be aware that some rewards cards come with a hefty annual fee. You need to be sure you’ll use the benefits on offer to make it worth it.
Consolidate your debt
If you’re struggling to pay off high-interest credit or store cards, consolidating the debt onto a 0% interest balance transfer card could save you money (although you may need to pay a fee to transfer a balance). You’d have one bill to manage each month. And you won’t be charged interest for a set period.
Section 75 protection
Credit card purchases over £100 and less than £30,000 are protected under Section 75 of the UK Consumer Credit Act. This means that if a purchase you make on your credit card goes wrong, you may be entitled to a refund.
Section 75 protection isn’t automatically guaranteed. It will depend on circumstances, the terms and conditions of your credit card provider, and the scheme rules of Mastercard, Visa or American Express.
Back-up payment methods
Having more than one credit card means you have a back-up payment method if one of your cards is lost, stolen or compromised.
If you need to report and freeze your lost card, you’ll still have a payment option while waiting for your replacement card to arrive.
What are the downsides of having more than one credit card?
While having more than one credit card can bring benefits, it might not be the best choice for everyone. Depending on your spending habits and financial situation, juggling more than one card could do more harm than good.
Risk of overspending
The more credit you have available, the more you may be tempted to spend. If you’re using one card because you’ve maxed the credit limit on another, you’ll end up with even more credit card debt.
Harder to keep track
Juggling several cards with different balances and payment dates can be tough. Multiple monthly repayments increase the risk of missing one.
Could affect future credit applications
Having multiple cards could be a reg flag for lenders. They’ll look at the total number of cards and credit limits combined, not just the money you’ve spent. They may see several cards as a sign that you’re struggling financially.
Credit cards that you never use can also have a negative impact on further credit applications. Lenders may ask why you’re applying for more credit when you already have access to unused credit.
How many credit cards is too many for me?
There’s no magic number to determine how many credit cards is too much for you. While one person may be able to juggle five cards easily, another may struggle with just one.
Ultimately it comes down to your spending habits, ability to manage your finances and how many cards you feel comfortable with.
To help you determine how many cards could be right for you, consider the following:
Your spending habits
If you’ve overspent in the past, having access to more credit might not be a good idea. If you can only make the minimum repayment on one or more cards, you may struggle to keep control of your finances.
Your money-management skills
It isn’t easy to keep track of different purchases, balances and payment dates each month. The more cards you have, the more complicated the admin side of things will be.
Features you can use
Some credit cards can offer fantastic rewards – but only if you make use of them. What’s the point of accumulating air miles if you hate flying?
Many rewards credit cards come with a hefty annual fee. If you’re paying fees on more than one card, the cost might outweigh the rewards you signed up for.
How can I manage multiple credit cards responsibly?
Here are a few practical tips to help you get organised and manage your credit cards responsibly:
- Set up automatic payments – set up a direct debit for each card to cover the amount due each month. That way you’ll avoid late or missed payments and additional charges.
- Create account alerts – if your credit card has an app, you may be able to set up notifications. These could alert you when you’re nearing your credit limit or when a payment is due.
- Change payment due dates – if possible, schedule your payment dates around the same time. For example, just after your payday will ensure there’s money in your account to make the repayments. There’s less risk than if you have different due dates spread throughout the month.
- Create a budget – sticking to a monthly budget can help you avoid overspending and going into credit card debt. Create a monthly spending limit and track your expenses to ensure you don’t spend more than you can afford to pay back.
- Get a budgeting app – some budgeting apps let you keep track of your transactions all in one place. This could help you manage your spending across your cards to ensure you stay within budget.
When is it bad to have multiple credit cards?
It might not be a good idea to have multiple credit cards if:
- You’re already struggling with debt – if you can only manage to make the minimum repayment on your cards each month, you could end up in ‘persistent debt’. If this happens, providers may decide to suspend your cards. It may also damage your credit score.
- You’re disorganised – if you find it difficult to stay on top of your finances, more cards will only cause you more stress.
- You don’t need an extra card – if you’re paying an annual fee for rewards you never use, what’s the point of having the card? If your monthly credit card spending is fairly low, you might be better off with just one standard card that works well for you.
Can I consolidate my credit card debts?
Yes, you can consolidate existing credit card debts. If you’re paying high interest on several cards, you could transfer the balances to a 0% balance transfer credit card.
This would give you a fixed period to pay off the entire debt without the burden of added interest. It also means you’ll have just one bill to pay each month.
You’ll need to pay a one-off fee for making the transfer. This is typically 1% to 4% of the amount you’re transferring.
Just make sure you finish paying off the balance in full before the 0% period ends. After that, you’ll be charged interest on any remaining balance. And you’ll need to make at least the minimum monthly payment each month or you could lose your 0% deal.
It’s important to note that consolidating debt on to one card doesn’t clear you of the debt. You’ll still need to pay back what you owe. If you continue to spend on your old cards, you’ll be more in debt than before.
Compare the Market Limited acts as a credit broker, not a lender. To apply you must be a UK resident and aged 18 or over. Credit is subject to status and eligibility.
Frequently asked questions
Can I have two of the same credit card?
Yes, it’s possible to have two of the same credit card. Many banks will let you apply for a second credit card. You might want to do this to extend your credit limit or to keep certain expenses separate.
Can I have a joint credit card?
No, you can’t take out a joint credit card in the UK. The credit card must be in one name only.
But you can add an additional cardholder to your account. This will give them permission to spend on the card. However, as the main cardholder, you’ll be legally responsible for the debt.
How often can I apply for a credit card?
You should try to wait at least six months between credit card applications. Every time you apply for a credit card, it leaves a mark on your credit file. Too many applications over a short period can damage your credit score.
If lenders see multiple applications for credit on your file, they may think you’re struggling financially and are desperate for money.
Should I get another credit card?
Whether you should get another credit card depends on your circumstances, needs and spending habits. Ask yourself:
- Why do I want another card?
- What benefits will I get by taking out another card?
- Will I struggle to manage with another card?
- Will I be tempted to spend more?
How do I cancel a credit card?
If you have too much plastic in your wallet, or have cards stashed away that you never use, you might want to consider cancelling them.
Contact your credit card provider and let them know you want to cancel your card.
Before you cancel your credit card, you’ll need to:
- Pay off any remaining balance on the card
- Cancel any regular payments, such as subscriptions or direct debits that are linked to the card.
Once you’ve cancelled your card, you must cut it up and dispose of it carefully to prevent any fraudulent use. You should also check your credit report to verify that the account has been closed and is no longer active.
