How to Know If You Have Too Many Credit Cards

Woman looks at a pyramid built from too many credit cards

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Sifting through your stack of credit cards, it's natural to wonder if you have too many. Or, if you're considering opening new credit accounts, you want to be sure another credit card won't affect your credit. "How many credit cards is too many?" is one of those questions that doesn't have a one-size-fits-all type of answer, but there are a few ways you can judge whether you have too many credit cards for you.

You Have a High Debt-to-Income Ratio

When lenders evaluate your loan application, they consider available credit as an opportunity for debt. They may calculate your debt-to-income ratio as if your credit cards were totally maxed out to gauge you at your riskiest possible debt level. You can do a similar DTI ratio calculation. If you maxed out your credit cards what would your debt-to-income ratio look like? Would it rise above 37%? If so, you should think about closing some of your unused credit card accounts, particularly newer ones with a $0 balance.

You Have a High Credit Utilization

Your credit utilization (30% of your credit score) indicates how much debt you have. It's calculated as your total debt divided by your total credit. So, for example, if your credit card limits total $5000 and your credit card balances total $2000, then your credit utilization is 40%. Ideally, your credit utilization should be less than 30%, lower than 10% is even better for your credit score.

The more credit cards you have, the more temptation there is to use them. As your credit card balances increase so does your credit utilization. One way to keep your credit utilization down is to minimize the number of credit cards you have and the balance you carry on those cards.

You Don't Have Experience With Other Types of Credit

The mix of credit is another credit score factor that involves the number of credit cards. The credit score calculation looks at all the types of accounts you have in your credit file to determine how much experience you have with different kinds of credit accounts. If you have several credit cards, but no other types of accounts, your credit score could be affected, but not likely by much. After all, the mix of credit is only 10% of your credit score.

You Have Difficulty Managing Your Credit Cards

Having too many credit cards will affect your ability to manage your payments. You need to be able to track your credit cards, including payment due dates, interest rates, fees, and charges you've made. It's much easier to manage your credit cards when you have only a few of them—like between one to three. It becomes increasingly difficult as the number of credit cards exceeds five. Still, it depends on your own ability to manage your credit cards.

Signs You Have Too Many Credit Cards

If you're just starting out with credit or rebuilding your credit, one credit card is enough. You need successful experience managing a single credit card before taking on additional credit responsibilities. As you get successful experience and consider opening additional credit cards, think about your ability to pay and track your credit cards. If you notice your credit card management getting out of control, it's a sign that you have too many credit cards.

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  1. Experian. “What Is a Credit Utilization Rate?” Accessed March 23, 2020.

  2. myFICO. “What Does Credit Mix Mean?” Accessed March 23, 2020.

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