Will a 2nd credit card boost my credit score?

Question

I'm 19 years old and I have one credit card that I have had for a year now. My credit it pretty good but I want to improve it anyway. If I were to get a 2nd credit card will this help my credit at all or make no difference? I wouldn't use it that much, I'm just curious if it would make a difference. Thanks!

Answer 1

Yes it will. Just be sure to keep your balances below 30% not 50% of your credit limit every month and pay in full before the due date.

For the best credit score and profile you need a mix of 3 credit card accounts (revolving) with balances below 30% of your limit and 2 cars, boats, homes, furniture or personal accounts (installment) all with good long payment history's.

This type of credit profile will give you the best score and mix of credit so you will be able to get just about any loan you need in the future at the best rates.

Additional information. Credit scores are based on 5-things not four as follows;

1. Payment history 35%
2. Time in bureau 15%
3. Types of credit 10%
4. New credit 10%
5. Debt to credit ratio 30%

Answer 2

I agree with Spifiman
I just wanted to add that you have an extremely thin file if all you have is the one credit card. Right now you would probably have a tough time getting good rates if you applied for a car loan or mortgage. I'm not saying you would not be approved, just that you would pay higher interest.

Your scores will probably dip a bit with the inquiry from applying for the card and when the card starts reporting.
As long as you keep your accounts in good standing, your scores should start improving within 6 months (more or less)
and by this time next year your scores shoujld be higher than they would be if you stuck with only one card.

Answer 3

Yes. However, you need to make sure you keep the balance below half of the available credit (at the most!). Make your payments on time and don't get carried away by getting more cards. I would also HIGHLY recommend that you enroll in an online credit monitoring tool. You can check your credit score whenever you want, watch for fraud, and also watch how the "system" works. You can usually find a good one for $7-15/mo. Make sure you shop around first. Some have more bells and whistles than others. Some only update their records every three months. Hope that helps. Good luck!

Answer 4

I don't think that it would...in fact if anything it might end up making it worse. The reason it might turn out to be bad is that if you have multiple credit card accounts (even if it's only two), this may have an adverse effect on your credit score, because you have too many "revolving accounts" on record.

As an example, a lot of people like to get those credit cards at major electronics stores to save that "extra" 5% off of the purchase that day, then cut it up and think nothing of it. Well, unless that person specifically closes the account (and even if they do), a note of it still exists on their credit report, and this can have negative ramifications for future credit applications, from different credit cards to applying for mortgages/student loans, etc.

I would suggest you stick with the one card you have now, use it frequently, but in small increments that you immediately pay off. Having one card that is in excellent standing will help, especially if you're going to be applying for any student loans in the future. Another alternative would be to take out a small loan for something that you need, as an example I needed a new computer for my college courses so I obtained a loan for about $1,000 but paid it off ahead of time, and my credit score went up because I was reliable on that loan.

So, I would suggest you don't get a second credit card "just to have one" unless you are going to use it. Some credit cards require a minimum amount of activity during a specific period of time, and you don't want to get stuck paying fees for a card "you aren't using that much". Make your current account obtain a higher limit by making purchases and paying them off on time/ahead of time and pursue other opportunities to enhance your score via small loans you can pay off.

Answer 5

Credit score is based on 4 things:
30 percent debt history
30 percent debt level
15 percent length of debt history
10 new debt
10 type of debt
A second credit card won't help all that much. Why worship at the fico alter, anyway?

Answer 6

It will only help if you use it responsibly. Alternate between the two cards and pay them off each month or at least way down. Your debt to income ratio will greatly influence your score. An excellent source for cards is this site:
http://www.1-800badcredit.com/bad-credit-card.html

Answer 7

Nowhere as much as making your payments on time and paying the whole thing off can. Don't get carried away with multiple credit cards--you can get buried in debt quickly with even one.