Current Events > Is it good to have 3 credit cards just to build credit?

(+) Yeah! (+)

Like I dont have any loans and wont need one any time soon but Im trying to help my credit score now. Ive got two credit cards right now, thinking about getting a third.

Also how long should you have a card before canceling it? In order to get one with a higher limit, I got one with a yearly fee, and Id like to cancel that one fairly soon but I dont know how that impacts anything.
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3 is nothing. I think the best possible credit score requires 20+ credit cards or something like that.

And try to downgrade the annual fee card to a card with no annual fee instead of canceling it, if you can. Canceling it will lower your average credit age, which hurts your score.
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you don't need any credit cards enjoy being poor

Damn_Underscore posted...

3 is nothing. I think the best possible credit score requires 20+ credit cards or something like that.

And try to downgrade the annual fee card to a card with no annual fee instead of canceling it, if you can. Canceling it will lower your average credit age, which hurts your score.

3 is the most I could balance without fucking up and overspending, like isnt it bad to have a bunch open without using them?

And that makes sense about downgrading, I still plan on keeping this one as is for a while just in case I need the high limit for any big purchases. Hopefully I should be able get that high of a limit without a fee in a year or two when my credit is good.
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King_Hutton posted...

Damn_Underscore posted...

3 is nothing. I think the best possible credit score requires 20+ credit cards or something like that.

And try to downgrade the annual fee card to a card with no annual fee instead of canceling it, if you can. Canceling it will lower your average credit age, which hurts your score.

isnt it bad to have a bunch open without using them?

I don't know. People say that if you have credit cards open that you don't use, buy a candy bar or something every few months just so it's being used. But I think that's to tell the credit card company that you're still using the card so they don't cancel it by mistake.

If you just have a lot of cards open that you don't use, that theoretically shouldn't hurt your credit score because you'll have a relatively large credit limit with low overall credit usage. In fact that would help your credit score.
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I keep getting conflicting info from people, maybe I ought to do my own research instead of asking people.

Dammit I hate doing my own research!
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Do not have more than 2 credit cards.

Do not put a high balance on them.

Really don't go over 50% of the limit

Try to pay off every month

Try to get ones with no annual fee

Most credit reports look at 36 months of payments. So don't just get a bunch and think that your score will go up

Every time you get a card your score goes down because the credit companies are worried you need more credit than you can afford.

50%, pay off monthly, no more than 2.
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I have 8 or 9 credit cards and I have great credit.

To an extent, having a higher total credit amount helps your credit.

I only use 1 on a regular basis and then put a charge here and there on the rest of them to keep them open.
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I wouldn't open a new card unless it has rewards/benefits that you're wanting to use that go beyond your current card(s).

Just to build credit, you might even hurt your score since your average account age would decrease with a new card. For example, I have 3 open lines of credit (2 credit cards and 1 mortgage) with an average age of 6yr 4mo. If I opened a new account, the average age would drop to 4yr 9mo and I'd lose score since I'd be below the 5yr mark

If you don't have an account at creditkarma.com, you should consider signing up for one since they break down all the factors that go into your credit score and the cutoff marks for each factor that goes into the score.
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^But the more cards you have, the higher your overall credit limit will be.

Opening a new card may be bad for your credit at first, but in the long run, it's definitely a good thing.
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Oh shit I forgot to factor in the age on them. Yeah this would definitely hurt my score getting another one so soon.

Still might be worth it, Ill get the credit karma account set up and figure it out from there.
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You literally don't need to use each card on a monthly basis, you just need to use it like once a year to keep it from getting canceled. If it gets canceled then the average age of your credit lines will decrease (this has a minimal impact on your credit score) and your total credit limit will go down (this can have a bigger impact on your credit score depending on how much credit you use between your other cards, since the percentage of usage will go up by default).

You also don't need 20+ cards and loans to get a good credit score.

I have a mortgage and three credit cards (one that I use regularly) and I have an 811 credit score. Anything in that range qualifies you for the top benefits, the 850 doesn't give you anything except for bragging rights.
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Also don't worry about "hurting your score" by opening a new account - it's bound to happen anyway, and unless you're on the threshold between ratings and you are planning on taking out a loan of some kind in the next 12 months, it won't really matter.
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Hexenherz posted...

Also don't worry about "hurting your score" by opening a new account - it's bound to happen anyway, and unless you're on the threshold between ratings and you are planning on taking out a loan of some kind in the next 12 months, it won't really matter.

I dont know if Ill have to take out a loan in the next 12 months though. Theres a lot of variables in my life right now.
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