10 Tips for Managing Multiple Credit Cards

Credit card rewards are a great way to add some excitement to managing your everyday finances. But, juggling too many credit cards at once can make you feel like you’re back in elementary school gym class, spinning plates on sticks for your circus unit.

The truth is that while managing multiple credit cards can bring tons of value to your life, it also makes it easier to get disorganized, which can have serious consequences. Debt issues, credit score implications, not to mention paying silly junk fees. That’s why today we’ve compiled a list of our best tips for managing credit cards to help you stay on top of them, avoid paying interest, and maximize the amounts of rewards that you earn. 

What are rewards credit cards?

Rewards credit cards are credit cards which incentivize you to use them when you spend. In exchange for using their financial product, credit card companies offer you perks like cash back, points, or miles, which all have a monetary value. You earn these rewards by using the card for your everyday spending, and you can redeem them for things like travel, money, or gift cards. 

Rewards cards often offer secondary perks that can be just as valuable as the monetary rewards for the right person. Things like fraud protection, extended warranties, rental car and cell phone insurance, and credits for TSA precheck or Global Entry may be some of the credit card benefits you’ve been overlooking…

What are the benefits of having multiple credit cards?

So if carrying multiple credit cards can complicate your finances, why do it at all? 

There are a few reasons why you might want to have multiple credit cards, even if it adds an extra step to your monthly financial check-in. Here are a few of the main benefits of juggling multiple credit cards.

Earn more rewards  

The most common reason to carry multiple credit cards is that doing so can help you maximize the amount of rewards you earn. This is because different credit cards offer specialized rewards for different spending categories. And using one card over the other might earn you a better reward rate.

For example, if you hold a card that is specifically built for gas rebates, using that card at all gas stations will give you the best reward rate. For flight purchases, it’s best to use a travel specific airline credit card. Holding a handful of different cards that cover the main types of spending you do gives you the best opportunity to earn the most rewards wherever you are. 

Only using one card for all of your purchases means forfeiting the bonus cashback, points and miles you could be earning for certain spending categories. If you spend a lot of money in these categories, you could be missing out big time on rewards!  

Sign up offers 

Another reason to hold multiple credit cards is to take advantage of various welcome offers. Many credit card companies offer huge reward opportunities for opening up their card and meeting a minimum spend within the first few months of opening. These bonuses are not insignificant.

Related- Learn how to use credit card rewards to travel for cheap (and sometimes free)!

Can increase your credit score 

Another great reason why you might want to manage multiple credit cards is that, if managed properly, it can help to boost your credit score. 

30% of your credit score is determined by your credit utilization rate. This is the amount of credit you use, versus what is available to you. When you open a new credit card, you increase the amount of available credit you have. If you manage to keep your spending the same as you increase your available credit, you could lower your credit utilization rate, in turn boosting your credit score. 

It’s important to note that although this could improve your credit in the long term, opening new cards rapidly within a short period of time can harm your credit score in the near term. This is due to the hard inquiry on your credit when you apply for the card. 

The Challenges of Managing Multiple Credit Cards 

Managing multiple cards will only be beneficial to your finances if you can follow the golden rules of plastic. This means paying your cards off in full and on time every month, and resisting the temptation to overspend. Falling into credit card debt or paying interest on a purchase will never be worth earning any amount of rewards. So make sure you can handle credit cards responsibly before trying this strategy.   

Even with all of these great benefits, there are some drawbacks to managing multiple credit cards. So it’s not for everyone. Here are some challenges you can expect to face while juggling your cards.

Difficulty tracking spending 

One of the biggest challenges when it comes to managing multiple credit cards is that it makes it more difficult to track your spending. Instead of just looking in one place to see how you’ve spent your money, you’ll need to look across multiple credit card statements. 

Having your spending spread out across many cards can also make it easier mentally to overspend. It can get confusing, and encourage you to just give up and stop tracking your spending overall. 

Easier to accumulate debt 

Because it’s more difficult to track your spending, it can also become a challenge to keep your spending in line. With your balance spread out across your credit cards, it can be harder to tell at a quick glance whether or not you’ll have enough money to pay everything off at the end of the month. This is why tracking your spending becomes even more important when you open up multiple credit cards. 

Could miss a payment 

The more cards you have, the more likely you are to forget to pay one of them off.

Missing credit card payments is the worst. Not only will you be slapped with that high interest rate- you could also be looking at fees and a major dip in your credit score. 

Annual Fees 

Many rewards cards carry annual fees, which can range from $50-700 per year. 

If you’ve ever listened to the show or read some of our posts, you’ll know that we hate fees. However, we take a more nuanced approach to annual fees for rewards credit cards. That’s because for the right person, a card’s benefits might totally outweigh the cost of the annual fee. 

However, if you aren’t getting enough value from a specific card, the annual fee could start to feel like a total drag on your finances. Multiply that by the number of cards you aren’t fully utilizing, and you could be losing hundreds of dollars every year. That’s why it’s important to only open cards with annual fees which you are confident you’ll get enough value from. 

Easy to get disorganized 

Lastly, it can be easy to get disorganized while managing many credit cards. This results in you using the wrong cards for your daily spending, and botching that rewards maximizing strategy you came up with.

What’s the point of having multiple credit cards if you aren’t actually maximizing your rewards?

10 Tips for managing multiple credit cards

If organization isn’t your strong suit, don’t give up on the credit card game just yet. Here are our 10 best tips for staying organized while managing multiple credit cards all while maximizing your rewards. 

1. Start slow 

When it comes to managing multiple credit cards, it’s important to not bite off more than you can chew right away. Don’t try to go from a single credit card to 20 credit cards over the course of a year. That’s a recipe for disaster! Instead, add a credit card to your arsenal here and there slowly over time. 

First, credit card companies and the credit bureaus don’t love it when you try to apply for too many new cards within a short period of time. This is because it makes it look like you’re desperate for credit and need it to live. They will earmark you as a riskier borrower if you take that route. This can hurt your credit score, and you’re likely to start getting rejected after applying for the first few cards. 

Second, if you spread your spending between a bunch of new cards, you may not be able to fulfill the minimum spend needed to earn all of your welcome offers. Missing out on these is a total bummer, because many cards only allow you to earn a signup bonus once per lifetime. Opening up a card and not taking advantage of this is a total waste! 

And last, going from 0 to 100 is an easy way to get disorganized. You never want to manage multiple credit cards at the expense of overspending and missing payments. 

Instead, add new cards to your wallet slowly over time and work your way up. I recommend staying within the Chase 24/5 rule. This means never open more than five credit cards within a 24 month period. Even if the new cards you’re interested in are not managed by Chase, it’s still a good rule of thumb to follow. 

2. Label your cards 

If you’re juggling a bunch of cards and want to make sure you maximize your rewards, one of the best things to do is to start labeling your cards. This will ensure that you’re using the right cards to earn the most rewards for your spending.

Go through all of your credit cards and make a note as to which cards provide the most rewards for each spending category. Then, designate which cards should be used for each type of purchase. 

Personally, I like to keep track of this in the notes app on my phone, but you can label your cards in whichever way makes sense to you. Post-it notes could be another good way to label your cards without interfering with them, or you could use a label maker as well. 

3. Use an app to track your spending 

If you’re having trouble keeping track of what you spend across multiple credit cards, it can be helpful to use an app which can pool and track your spending for you. 

One of our favorite budgeting platforms is YNAB, or You Need A Budget. YNAB allows you to track your spending across all of your credit cards and bank accounts with ease, and helps you to easily manage your budget. While it does cost a little bit of money, their users save around $6,000 in the first year of using it. 

And while we used to love Mint for tracking expenses, it sadly has been shut down by its parent company, Intuit. Luckily, we’ve found the 6 best Mint alternatives that can help you to track your spending every month. 

4. Keep track of annual fees 

Nothing feels more like a slap in the face than getting hit with an annual fee for a card you haven’t used in months. When managing multiple credit cards, it’s important to regularly weigh the rewards you earn against the annual fee for each card, and evaluate whether or not it is still worth it for you. 

Set a calendar reminder for about a week before your annual fee is set to charge. Decide whether or not you get enough value to hold onto that card before you get charged. If you decide that the benefits do not outweigh the fee for your current lifestyle, consider closing the card (which will affect your credit), or calling up the credit card company to ask if you can downgrade your card to one without an annual fee. Just be sure not to close too many credit cards at once- this will increase your credit utilization, potentially harming your credit score. 

5. Set up autopay 

If you’re worried about missing a payment for any of your cards, try automating your payments!

Putting your cards on autopay can be a safeguard against missing payments and incurring interest and fees. However, this doesn’t mean that you get a free pass to avoid looking at your credit card statements. It’s still important to know exactly what you’re spending, and to feel that pain of the money you’ve spent leaving your account. Still, setting up autopay can protect you from accidentally hurting your finances when life gets crazy. 

6. Keep your credit card apps in a folder 

One thing that helps me to stay organized while managing multiple credit cards is keeping all of my credit card apps in a single folder on my phone. Having them all pooled together in one place allows me to quickly reference which cards I have open, as well as how much I’ve spent so far in a month. It also makes it easy to pay off all of your cards at once!

7. Change your due dates to the same day every month 

It can be hard to manage your credit cards if they all have different due dates. One of the best hacks to remedy this is to call up your credit card companies and request to have a due date change. If you ask nicely, and have a good history of paying your cards off on time, most credit card companies will be happy to oblige. Then, you can go in and pay all of your cards on the same day, saving you precious mental energy and time. 

8. Open new cards before making a large purchase 

If you have your eyes set on a big signup bonus, consider holding off on opening up that card until you’re about to make a larger purchase. This can help you to meet your minimum spend more quickly. And you’ll have to spend less time closely tracking your progress on that bonus. Big expenses like vacations and home and car maintenance are great opportunities to sweeten the deal with a major sign up bonus!

9. Add your cards to your digital wallet

Have you ever gone out to do some shopping and experienced extreme disappointment when you realize that you’ve left the best card for your purchase at home? 

When you add all of your credit cards to a digital wallet, you don’t need to worry about leaving the right card behind. Now, you’ll always have the right card on your person for every purchase you make. As long as you don’t forget your phone! 

10. Practice mindful spending 

When you’re managing multiple credit cards, it’s even more important to practice mindful spending. 

Mindful spending, simply put, is aligning your spending habits with your values, and being intentional with your money. It’s all about thinking about your purchases before making them, and identifying and getting ahead of potential spending triggers. 

If you begin overspending more than you normally would, you’re not coming out on top. Even if you are earning rewards. Here are a few mindful spending techniques to try out. 

• Ignore sales unless you need something. Remember, the best discount is 100% off you’ll get when you forgo a purchase altogether. 
• Perform a subscription audit. 54% of folks underestimate what they pay in subscriptions each month by $100 or more…
• Identify your spending triggers. Do you tend to spend more when you’re busy, bored or stressed?
• Make a 24hr waitlist. Add items to your cart, but don’t actually order them until you’ve waited at least 24 hours. 
• Consider secondary costs. Everything costs more than you think it will…
• Think about purchases in terms of your hourly rate. That dinner out may not seem as enticing when you realize it costs you 4 hours of work! 

Frequently asked questions:

For many, managing multiple credit cards is uncharted waters. That’s why we’re covering some of the most frequently asked questions when it comes to managing multiple cards.

Is it okay to have multiple credit cards and not use all of them? 

In short, yes! It’s okay to use some of your credit cards less than others. But keep in mind that some credit card companies will close your account if you have been inactive for a few months or years. To be safe, it’s a good idea to use all your cards at least once in a while. Charge a 25c banana to one if you have to to show some basic activity. Just make sure to pay them all right away if you’d like to keep the account open. 

You should also be sure to take annual fees into account. Paying annual fees without taking advantage of rewards is costing you money. So in this case it could be a good idea to call up your credit card company and ask to downgrade your card to something without an annual fee. Or, cancel the card altogether. 

What’s the ideal number of credit cards to have?

The perfect number of credit cards will vary from person to person. Unfortunately, there is no magic number! 

I know people with 20+ credit cards. And I know some with only a single card. All of them make it work for them. Personally, I have 7 cards open, and plan to open 1-2 more next year. In my opinion, the perfect number of credit cards for you is the number of cards you can have open while still taking full advantage of all of their perks, and managing them responsibly. 

Can having multiple credit cards hurt my credit score?

Yes and no. If you open a ton of credit cards at the same time, spend irresponsibly, miss payments, or rack up credit card debt, having multiple cards can certainly hurt your credit score. 

However, if you use your credit cards responsibly, having multiple credit cards can actually boost your score by lowering your utilization rate, and diversifying your credit mix. 

Will closing a credit card hurt my credit score?

It is true that sometimes closing a credit card can affect your credit score. The reasoning, once again, comes back to your credit utilization rate. 

Let’s say you have three credit cards: 

1. Credit Card A: 

• Available credit: $5,000
• Balance: $2,000

2. Credit Card B:

• Available credit: $4,000
• Balance: $4,000

3. Credit Card C: 

• Available credit: $6,000
• Balance: $0

As it stands, your credit utilization rate is 40%. But if you decide to close card number three because you don’t use it, suddenly your utilization rate jumps up to 66%! 

So how can you mitigate this risk? Make an effort to pay down your credit cards as much as possible before canceling. This will keep your utilization low even when you cancel.

The Bottom Line: 

Credit cards are a great way to get rewarded for your everyday spending. But it’s important that you stay organized while managing multiple credit cards at once. If you’re forgetful and not organized, you could run into debt problems, pay unnecessary fees, and miss out on meaningful rewards. But with good rules and systems in place to manage multiple credit cards, you’ll be able to maximize those rewards and avoid the common pitfalls many folks fall into with credit cards.

Remember that earning rewards is only beneficial if you maintain best credit card practices. The most important is to ALWAYS pay off your cards in full each month. No rewards are worth going into debt and paying high interest for.

Related Posts: 

• Our Favorite Credit Cards for How You Spend
• The Ultimate Guide to Travel Credit Cards
• Are Credit Card Rewards Worth It?

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