Great Reasons to Have Multiple Credit Cards

There are many reasons why people are afraid of getting multiple credit cards. First, some think that having higher credit limits can tempt them into overspending. Second, they are worried that it might be hard to manage multiple cards and they can fall behind on payments. Third, some believe that lenders would have difficulty trusting them if they have too many cards. However, all of these are not true. With responsible usage, having multiple credit cards can actually be beneficial.

Financial safety

One of the reasons why many experts view having multiple credit cards as important is because of safety reasons. According to them, you should keep at least one card with a zero-balance in a safe place away from home, so in case your purse is stolen, or worse, your house gets burned down, you’ll have a credit card to use while waiting for the replacement cards. In addition, if you’re making online purchases, it is advisable to assign one card with a lower credit limit solely for this purpose. This can help you monitor more easily for fraudulent activities and limit the damages if you’ve fallen victim of identity theft.

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Rewards

The best part of having a credit card is earning rewards for every penny spent. You can have discounts or gift certificates at some retailers, or earn free movie tickets, etc. However, make sure you understand every detail of your rewards program. Most of the time, rewards cards carry higher interest rates, which makes it impractical to use. Another thing is that most rewards cards max out and stop accumulating points after a certain amount of purchases.

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Easier bookkeeping

If you’re the type of person who uses credit cards for work-related expenses that your employer would reimburse, then setting aside a credit card for this specific task might be beneficial to you. You can eliminate the difficulty of having to separate work expenditures from personal ones. If you are self-employed, you can track work-related expenses more easily for tax deductions.

Bills scheduling

If you have multiple credit cards, you can control your spending based on your billing cycles. For example, if you have one card that ends on the 10th and one that ends on the 25th of every month, you can use them shortly after the end of each billing cycle in order to maximize the time between the purchase and payment.

Credit score aid

Some people are afraid of keeping multiple credit cards thinking that lenders will assume they’ll be more prone to debt, however, that’s not just how credit scores work. Having a lot of responsible activities is actually healthy for your credit score. In addition, if you have lots of available credit, it can help keep your credit utilization in check, making sure that your debt is as far away from your credit limit as possible.

Leverage

If you have multiple credit cards and a decent credit score, you can use them to your advantage. You can have options which you can use as leverage in order to negotiate for better deals and lower your interest rates.

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