Popular financial wisdom often says yes: Having too many credit cards can hurt your credit score. Which of course immediately begs the question: How many credit cards are "too many"?

Several different factors can help you determine the right number of cards for you. But actually, it's less the number of credit cards you carry; rather, it's more how you manage them and the circumstances under which you obtain them that matters.

Key Takeaways

  • Having a lot of credit cards can hurt your credit score if the total amount you owe on them exceeds 30% of your credit limit.
  • Holding numerous credit cards also hurts your credit score if that causes you to pay late, or if you've opened too many accounts in too short a time.
  • If you do have too many credit cards, don't close the accounts—doing so hurts your score.
  • In some cases, it might help your score to get more cards.

How Credit Scores Are Affected

Understanding how your credit score is calculated is key to determining whether you are carrying too many credit cards, or perhaps too few. Let's quickly review the key components of your credit score vis-à-vis the amount of plastic you carry.

Payment History – 35%

The biggest score factor is your payment history. Although this consists of all of your credit payments from all of your debt, your credit card payments are the biggest variable. Credit card companies are the least forgiving when payments come in late and are quick to report to credit bureaus if they are tardy.

Carrying multiple credit cards can be difficult to manage from month to month.

Debt-to-Credit Ratio – 30%

Also referred to as credit utilization, this ratio measures the outstanding debt on your credit cards in relation to your available credit—basically, how close you are to the credit limits on all your cards. The ratio hurts your score if it exceeds 30%.

Having more credit cards can actually improve your score because it means you've more money to play with and reduces the debt percentage. However, it can also hurt your score if your total outstanding balances exceed one-third of your total available credit.

Length of Credit History – 15%

This is where people with multiple credit cards can get into trouble. Building a responsible history of on-time payments improves your score over time. People with excellent credit scores have an average age of 11 years for all of their cards, with the oldest card being 25 years old.

If your credit history is short, adding too many new cards reduces the average age of your credit accounts, which in turn can drag down your credit score.

New Credit – 10%

Whenever you add a new credit account, it can cause your credit score to drop a few points: first when the creditor makes an inquiry on your credit report; second, when the account is actually opened.

Too many inquiries and too many new accounts opened within a short period of time are red flags for credit bureaus, often signaling increased credit risk.

Type of Credit – 10%

Credit bureaus like to see how you manage debt across different types of credit accounts. Your credit portfolio ideally should consist of a mix of credit cards, retail accounts, installment loans, auto loans, or a mortgage.

If all of your accounts are of one type, such as credit cards, it could hurt your score.

How Many Cards to Own

If you are a novice credit card user, focus on building a credit history with one or two cards and paying off your balance in full each month. Adding credit cards for specific purposes, such as a good rewards program or for obtaining better travel insurance, can also make sense as long as they are not added within a short period of time. 

If you have been using credit cards for several years, it may make sense to add a card if it has a significantly lower interest rate—or if you feel you now qualify for better terms. Or, you might want to transfer a balance to a new card that's offering a 0%-interest rate promotion (or some other incredibly low rate) for a time. However, you still need to focus on keeping your debt-to-credit ratio below 30%. 

3.7

The average number of cards held by credit card owners, according to Gallup

Dealing With Too Many Cards

If you think you may have too many cards, the worst thing you can do is start closing some accounts without considering the impact on your credit score. Closing older credit cards can shorten your credit history, which can hurt your score.

Payment history on closed accounts eventually falls off your report, which can also hurt your score. Closing credit card accounts also reduces the amount of available credit, which can hurt your debt-to-credit ratio if you have outstanding balances.

It is better to leave your credit card accounts open and just put these cards on ice. if you get a warning about inactivity from the card issuer, use that card a bit just to prevent the account being closed.

When It's OK to Get Another Card

Although not as go-go as they once were, credit card companies still often solicit people to open accounts—you know, those "you've been pre-approved!" mailings you often get. Should you be tempted? Well, sometimes. Good reasons to acquire more cards include: 

  • Getting a low-interest rate 
  • Transferring a balance (especially if the new card's offering a great promo)
  • Obtaining better perks, more cash-back, or more useful rewards 
  • Adding available credit to lower your debt-to-credit ratio
  • Getting a higher credit limit than you've ever had

The Bottom Line

Having a lot of credit cards can hurt your credit score under any of the following conditions: 

  • You have so many payments that you haven’t been able to keep up with all them
  • Your outstanding debt is more than 30% of your total available credit 
  • You have added too many cards in too short a time 
  • You lack diversity in your credit accounts

However, if you do have too many cards, don’t simply start closing accounts. That can never help your credit score. Instead, leave them open and just stop using them.