How many credit cards should you have?

How many credit cards should you have?


This article is a contribution towards our financial literacy series. It has been written by a specialist in credit and debt counseling – Satish Mehta, Founder and Director of


cc_August08In today’s age and time, almost everyone holds a credit card. While it is a convenient option for many of us, strangely, it is also a “cool” option for a few, who think that flaunting a wallet with different credit cards in a party or at a shopping mall is definitely looked upon as “cool”.

But how many credit cards should you actually hold? The “one size fits all” solution cannot be applied to answer this question. For example, a working professional can hold two cards and a fresh MBA graduate could hold one card, or maybe none.

Firstly, the optimal number of credit cards that you could hold should depend on your “needs” and not on your “wants”. If you have been holding a high number of credit cards to fulfil your “wants,” then take this as a warning signal. Step back, understand your budget and then do away with that greed.

Secondly, the trick, along with holding an optimal number of credit cards, is also using the credit card wisely. Having one credit card with up to 30-40% of utilization is better than having a credit card maxed to its credit limit. Similarly, having three credit cards with low balances and regular repayments is better than having three credit cards with high outstanding balances. The number of credit cards held is the same; but their impact is quite different.

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Thirdly, your spending habit is a factor that impacts your decision to hold more credit cards. If you are a spendthrift, then you might end up holding more credit cards irrespective of what your income and real need is.

So, there is no magic number that declares the number of credit cards you should hold. However, there is one way to find out if you have been holding more than what you can manage. If you associate with any of the following points then, yes, it’s time you cut down on your credit cards.

– You are unable to repay your credit card bills on time
– You are repaying the minimum amount due on your credit card and building up on the outstanding amount
– You obtain your CIBIL credit report and find open credit cards that you have forgotten about

In cases like the above, less is always better than more!


Satish Mehta is the Founder and Director of – a credit and debt counselling company that provides end to end customized counselling to individuals by handholding them through their credit life cycle.

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