I have five credit cards...just closed one today making it four. Is it bad that I just closed one? I never use it because it has interest. How many cards should I have? My FICO is 676. My first credit card was a little over a year. I am really young (20) and that is why I havent really have a credit history.
2007-10-08 05:59:44 · 6 answers · asked by K-Lynn 2 in Business & Finance ➔ Credit
The number of cards you have is not important, what is, is how you manage them.
As long as your balances are below 30% of your credit limit and you are paying them as agreed you are fine.
I had 14 at one time and had great credit because I managed them will, I now hove 5 and still have great credit for the same reason.
2007-10-08 06:08:37 · answer #1 · answered by ? 7 · 3⤊ 1⤋
As for a 20 years old, I think you are on the right track. But do not close any more credit cards nor apply for more. But you do need to start using your credit card, just pay it off whenever there is a balance due. If there is no activities you are not building up your credit. And I hope you didn't close the longer history of credit card that you have. Because that is part of the FICO score calculation..the longer the credit history the better.
No, you are fine with 4 credit cards.
2007-10-08 13:45:04 · answer #2 · answered by Anonymous · 1⤊ 0⤋
At some point, too many credit cards will affect your score. However, 4 or 5 isn't that point.
More important is not carrying balances. A big part of your score is the ratio of debt to available credit limit. Try to keep it below 30%. Paying the cards in full every month is even better.
When you close credit card accounts you decrease your available credit limit. If you have balances on the other cards, your percentage of debt would increase. Closing accounts also closes your payment history with that card.
Many people will tell you to never close a credit card; just don't use it. But I think it is silly to keep a stack of credit cards that you don't use. They have to be monitored and secured. All sorts of potential problems.
I recommend that you keep the two oldest major credit cards that do not charge annual fees. Only keep store or gas charge cards if you have some special reason. However, don't close any cards till you have paid them in full.
Also, always send a letter to close an account and request written verification that the account is closed. Keep these with your important financial papers.
2007-10-08 13:11:48 · answer #3 · answered by bdancer222 7 · 1⤊ 1⤋
Actually if you have too many open cards, the rating agencies will get concerned...especially if your debt capacity greatly exceeds your ability to pay it off. They will always be concerned that you could go on a spending spree and max out all of your credit. BUT...they will also be concerned if all of the sudden you start to close a bunch of cards, assuming that there is some sort of problem. I would say that four cards is not too many, assuming that you do not carry a balance on them. You may want to make sure to make a small purchase on each card from time to time and pay it off immediately to establish a responsible track record. Ultimately, the balances you carry will matter WAY more than your debt capacity. I hope this helps!
2007-10-08 13:07:19 · answer #4 · answered by bill_in_il 2 · 1⤊ 2⤋
You can have as many credit cards you want. All that matters is how well you are keeping your bills paid !!
2007-10-08 13:02:31 · answer #5 · answered by [ kila tequila ] 2 · 1⤊ 1⤋
I only have one. I need one to buy online, for hotels and flights.
Having one reduces the interest, is easier to pay, and I can keep
track of it. I know the balance and the limit.
Try for one. You'll be happier.
good luck to you.
2007-10-08 13:09:41 · answer #6 · answered by Larry W 5 · 1⤊ 2⤋