My friend to me: “My wife uses just one credit card. She doesn’t care about the rewards. Managing multiple cards is painful for her!”
The quick and short answer is, there is no one size fits all. You will need zero, one or multiple cards depending on your preference, spending habits, ability to make payments and what categories you spend on.
0 – ZERO credit cards
- You use your card to buy things you can’t afford and don’t really need.
- You end up not paying the full balance every month and thus pay crazy interest rates to credit card companies.
If this is how you roll, then you should not have a credit card. You’ll just end up digging yourself deeper and deeper into the debt abyss unless you take actions. Use your debit card or cash so that you can buy only with the REAL MONEY that you have!
If you’re in control of your spending and you’re able to make full payments every month then read on.
One credit card
This approach will keep things simple! There’s just one card to use and one monthly bill to pay. The issue with this is, you may be losing out on rewards/returns from the other credit card categories. Ex: the card that you carry might give you only 1% cash back on the ‘everything else’ category (Medical bills, phone bill, car repair, membership fees etc). Why get a 1% return when you can get back 2% with Citi Double Cash right?
Of course, there are several people (like my friend’s wife) who prefer the simplicity of handling one card over managing multiple cards. They are not running after rewards.
Many credit cards
A lot of people fall into this bucket including me. This approach is great if you want to maximize your rewards in different categories like groceries, online streaming, gas, transit, travel (airline + hotels), restaurants etc.
The stats vary but Americans typically carry 3-4 credit cards in their wallets so that they can use the right card at the right place to maximize returns.
The problem with carrying multiple cards is – you got to pay multiple bills every month at different due dates. It can be easy to miss a payment unless you’re on auto pay or you diligently track things. Also, while making a purchase, you got to do a quick mental juggle to decide which card to use (for max returns) although you’ll get used to this with time.
Word of advice
At WellOiledMoney, we focus on how you can make more % gains with your money by making good investment decisions. We don’t want you to spend your hard-earned money on paying interest to credit card companies. If you use a CC, use it wisely. Buy only what you can afford and what you absolutely need. Pay off that CC bill in full every month.
Please swipe/insert/tap/checkout responsibly!!!
I stopped using credit cards because I could not control my spending. I now use only cash or debit cards.
That’s good cause you won’t incur those crazy credit card interest rates anymore…with some self-control you can learn to use credit cards the right way and pay off your bill in full every month. That way you will accumulate points/cash back that you can put to good use.
I have a few credit cards that I don’t even use. Maybe I should get rid of those and keep only the ones that I actively use.
I did that cleanup activity a few years ago. Closed all the cards that I never or rarely used. Feels good to eliminate clutter 🙂
When I see a better card ex: offering 2% instead of 1.5% cash back then I get the better card and close out the older one. Recently got rid of CapitalOne and got Wells Fargo.
I’m trying to find a good card with rewards in both restaurants and travel expenses with no annual fee. The ones that I’ve researched provide rewards in either category but not both. Any suggestions?
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I was using just one credit card for a long time but was losing out on rewards. Now I carry multiple cards to get more my rewards in diff categories.
Same here until I went with the route of using multiple cards to maximize rewards.
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I have a few cards for different spending categories. If there’s a better deal that I can find, then I get the new card and cancel the old one.
Over the years, I’ve done the same. Why stick with a card that gives you less returns? Always be on the lookout for higher % returns.
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