Whether you just paid off the last of your credit card balance or have a few cards that you want to consolidate, you may wonder if you need to keep unused cards open or close the accounts so you do not have to worry about them. The average American actually has more than one open credit card, and that number is continuing to rise. According to a study from Experian credit bureau from June 2015, the average consumer held 2.09 cards in 2013, 2.18 cards in 2014, and 2.24 cards in 2015. That number is not quite as high as during the recession, when the average was 2.57 in 2010, dropping to 1.98 in 2010 after debt was starting to be taken more seriously and credit standards where extremely tight, making it difficult to open new accounts. Large store retail credit cards have taken a hit, perhaps not having the same rewards and interest rates as bank issued cards; have declined from the recession, going from an average of 2.25 retail cards per person in 2007, to 1.55 now.
So how many open credit cards should you have? There are actually pros and cons to each. Keeping many cards open with low balances can actually help your credit score, showing you are responsible in not racking up a high amount of debt to your available limit. Depending on the cards you have, the rewards may vary to card to card so having the choice of putting a purchase on different cards could end up saving you more money in the long run. Having multiple open accounts with a high debt limit does take extreme discipline. The seemingly endless amount of credit available to you can open up the potential of continuous shopping sprees and unnecessary spending which can put you right into debt, or if you are already in debt, put you into a black hole that you will never be able to climb out of. I do have a few store specific cards, as does my wife. It’s great for additional rewards on purchases that will end up being made regardless. Though the last time I visited my wife’s victoria secret credit card login I was surprised at the spending she amassed, so take that advice with a grain of salt.
In the end it is personal preference. If you want to keep it simple and manage one account, keep one credit card open, but if you have no trouble managing multiple accounts and due dates, then perhaps leaving multiple accounts open to you is not an issue. In the end in whichever route you decide, stick to your budget and avoid spending your entire limit. You will thank yourself in years to come.