What is the right number of credit cards to have?

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Q: What is the right number of credit cards to have?

A: This is actually one of the most popular questions consumers ask about cards. According to a recent Gallup poll, the average number of cards that Americans say they own is 3.7. But on the far end of the spectrum, seven percent say they have at least seven cards.

It's easy to see how some consumers might want to have several different types of cards. For instance, those who use rewards cards might want to have a cash back card as well as an airline miles card. But there seems to be a concern that if you have either too many cards or not enough cards, it will hurt your score.

The number doesn't matter

Well, you might be relieved to hear that the number of cards you have will not directly impact your score. But the way you use your cards will affect your score. There are five factors that are considered when a FICO score is calculated. Two very important factors involve your payment history and how high your balances are. Your payment history is 35 percent of your FICO score. So paying all of your bills on time -- not just your credit card bills -- helps this part of your score. So do whatever you need to do to set up reminders to pay your bills.

Playing the percentages

Another big factor that's part of your score calculation is your credit utilization ratio. This ratio is the amount of credit you've used compared to the amount of credit you have available. You want your ratio to be less than 30 percent of your FICO score. But if you keep your ratio closer to ten percent, you'll be in even better shape when it comes to your score.

So when you have a utilization ratio over 30 percent, it can lower your score. Even if you have 20 cards (don't try this at home!), but your utilization ratio is under 30 percent, you shouldn't be penalized when it comes to that part of the score. If you only have one card, but your utilization ratio is 50 percent, your score will suffer.

Be smart with your plastic

As you can see, the affect on your score has more to do with your behavior than it does with the number of cards you have. Now, having said that, it's important to remember that it's possible to have so many cards that you become disorganized and don't pay your bills on time. Or you might forget that you're getting close to the limit on one of the nine cards in your wallet and end up with a high utilization ratio. Another issue that some folks face is the temptation to spend simply because they have all of these cards.

So although the number of cards itself doesn't impact your score, it's possible to have more than you can handle. The bottom line? Have as many cards as you need and that you can manage responsibly. Only you can decide what that number should be. And to help you keep tabs on your score, check out LendingTree's free credit score.

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