Are Too Many Credit Cards Costing You Money?

You can own as many credit cards as you want. Primarily, this depends on the amount of balance in your bank account and the status of your credit score.

There is no legal limit to the number of credit cards you can own at any one time. Ultimately, it is up to the bank or the credit card issuing organization.

Another important question people ask is: “Do I need another credit card?” Well, we think no one can answer this question because there is no definitive answer to it.

However, we think it depends entirely on your personal preferences and requirements. There is a wide range of credit cards available and each is designed for a specific purpose.

What type of credit card you want? Well, this is another imperative question and needs an answer. Read on to know the type of credit cards that are suitable for you.

Low-APR Credit Cards

APR stands for annual percentage rate. Cards with a low APR are an ideal choice for people who seek one card, which will last for a specific time period and acts as a good source of credit.

On the whole, you won’t get any additional benefits from Low-APR credit cards beyond a lower borrowing cost. However, in itself, we think this is enough of an incentive.

0% Purchase Cards

These cards are available for a specified time period and charge you a 0% interest rate on your purchases. Essentially, these cards are valuable to make purchases, especially when the 0% interest rate period is active.

You can stop using this card as soon as the interest-free period finishes. Also, you can cancel the 0% purchase card altogether.
Otherwise, if you continue to use it after the 0% interest rate, the bank may charge you higher than average. So, using it for a certain period and then canceling it is a great idea.

0% Balance Transfer Cards

Some credit cards charge 0% on transfers of balance. Interestingly, it is an ideal way to escape your existing debt.
Such cards allow out to transfer debt from your existing credit card to a new one. This delays the paying interest on your initial debt until the period of 0% balance transfer ends on the new card.

Cash Back or Reward Cards

People with a good credit score are confident enough to keep up with their repayments. For them, the reward-based credit cards are the best. These credit cards offer cashback rewards on certain purchases.

Also, they offer redeemable points on flights for every dollar spent. So much so, cashback or reward-based credit cards come with high annual percentage rates. Therefore, you must take one if you are sure that you can make payments every month.

Credit Building Cards

They are designed specifically for users with limited or bad credit records. Not only do they come with higher APRs but they also emphasize a low credit limit for ensuring responsible use of credit.

When you spend on credit building cards and pay off your balance in full regularly, you can increase your credit scores over time and use the credit adequately.

After you have improved the credit score effectively and sufficiently, you can apply for better credit cards. Good Luck!