Do you carry one credit card, or a whole pocket full?
Once upon a time having a fistful of cards was seen in some circles as some kind of status symbol – showing how much great credit you had. Unfortunately, many got into trouble over it because they actually used all those cards.
Others, fearing their own tendencies to overspend, opted to own just one card.
Either way is the best answer. Life is not only more convenient, but safer and more economic when you carry at least 2 different credit cards. You just have to remember to control your own spending.
Experts advise owning one card that generally has a zero balance. They go so far as to recommend keeping that card in a safe deposit box – if you become the victim of a robbery or a house fire, you'll have that credit line as a safety net to get you through the initial days or weeks of chaos. I say "generally has," because in today's credit card climate, you should use each card at least once every calendar quarter, just to keep it active. Card issuers do not like the expense of carrying inactive cards and have been closing accounts right and left.
Another reason for multiple cards is so you can keep one exclusively for on line purchases. This makes it easy to spot a bogus charge and get it removed quickly. Plus, you need not worry about all of your account numbers being at risk from hackers.
If you use your cards for business, you should have one card that is used for nothing but business expenses. If you qualify, get a "business card." If you are meticulous in keeping expenses separate and have to carry a balance, your tax accountant will probably allow you to deduct the interest, but if you mix business and personal expenses, they will not. Business cards often send a year-end summary – a good tool to make sure you're deducting every allowable expense.
Now consider rewards – you may have one card that rewards your office expenses while another rewards gasoline purchases or restaurant meals. Keep track of what's offered and use the cards in their proper places.
Multiple cards also boost your credit scores – as long as you do not let your charges on any one rise above 30% of the credit limit in any one month.
Lastly, if you have multiple cards and one card issuer suddenly decides to cut your credit line or raise your interest, you'll have somewhere else to turn.