While there is no magic number of credit cards to hold in your name, I’ve repeatedly recommended trying to balance at least two or three of them to give your personal finances a boost. The advice to juggle multiple credit cards won’t work for everyone, though—after all, using a credit card comes with inherent risk—and there are plenty of reasons why you may want to consolidate down to just one card. Here’s when having a single credit card might be the right move for you.
You can use one credit card to simplify your finances
The more credit cards you have, the harder it can be to keep track of due dates, benefits, interest rates, and so on. With only one card, it’s much simpler to monitor your spending, make payments on time, and avoid late fees or hits to your credit. If you have credit card anxiety as a result of an “all debt is bad” mentality (which isn’t true!), or if you’re just new to managing credit, this streamlined approach can reduce stress and help you better manage your finances.
Use one credit card if you’re just starting to build your credit history
If you’re new to credit or rebuilding your credit score, having just one card can help you establish a positive history. Using it for regular expenses and paying it off each month demonstrates that you can responsibly handle credit. Remember: Even an unused credit card with a $0 balance will report positive information to the credit bureaus each month. Then, as you build your score over time, you can apply for more cards down the road.
Avoid high annual credit card fees
Multiple cards often means multiple annual fees. If you’re not getting enough perks and rewards to offset those costs, consolidate to a no-annual-fee card. This will allow you to keep an open account without the hefty yearly charges. Here’s the math on whether your card’s annual fee will effectively pay for itself.
Use one card to improve chances for credit approval
If you need a large credit line for a major purchase, having fewer open accounts can improve your approval odds for a new card. Issuers tend to extend less credit to those who already have access to lots of available credit across multiple cards.
Use one card to minimize your debt risk
For many people, this is the most important reason to limit yourself to just one credit card, and it’s devastatingly simple: The more access you have to credit, the easier it is to overspend. When you only use one card, you reduce how much you can overspend, and it also minimizes the number of balances you need to keep track of each month. If you have concerns about taking on debt, a single card is just safer.
Of course, there are plenty of good reasons to have multiple credit cards, but you should only juggle credit cards if you’re confident in your ability to always pay off your balances in full and on time each month. In the right circumstances, scaling back to just one card can be prudent. If you’re nervous about accumulating debt, start off by letting it work quietly in the background to responsibly build your credit history. Sites like Credit Cards Explained can be useful resources to find the cards that best suit your lifestyle.
Ultimately, the best credit card strategy for you is whatever keeps you out of debt. Keep track of due dates, balances, and rewards in a spreadsheet or financial app.
