Credit cards play a large role in the development of your credit profile and your credit scores. Credit cards can greatly demonstrate your responsibleness, your payment history, your usage patterns, and your overall ability to be able to handle credit. So how many credit cards should a person have to get the best credit score? What is more important how high your credit limits or how much you owe on your credit cards? Which credit cards should I payoff first, high rate, high balance cards or low rate, low balance cards? After you pay off your credit cards, should you close the account? These questions and more will be answered throughout this page.
While it may be tempting to adopt a policy that more is better when it comes to credit cards, it is not necessary to have more than 6 credit cards for most credit purposes. While as with all credit matters there are exceptions, a minimum of 4 credit cards will help you meet most tradeline requirements for most loan programs.
The most common credit card tip is to grab all your credit card statements and see what credit card charges the highest interest rate. When you find the credit card with the highest rate you should apply as much as you can to that credit card while making minimum payments on the other credit cards. Once the credit card with the highest balance is paid off move on to the next credit card with the highest interest rate. Repeat this process until all your credit cards are paid off.
It is important to make sure you spread out any balances over a few different credit cards. For a maximum credit rating, you do not want to exceed a 30% balance to credit limit ratio. If you have recently paid off a card, do not close it but rather use it for small purchases and pay it off monthly.
To make sure that your credit cards do not hurt your credit score make sure that you pay your balances on time and pay off your balances.