This article was updated on June 24, 2018.

According to Experian, the average person had 2.24 credit cards in 2015, but that doesn't mean that having more -- three, four, or even five cards -- is necessarily bad. In fact, having multiple open lines of credit can be positive for your credit report and score, helping to pad your credit file with several accounts in good standing.

Do you have too many cards?

There are only a few scenarios in which it's clear that someone has too many cards. The surest sign is that cards become unmanageable in one way or another.

  • If you're struggling to manage and pay your cards on time, or find yourself constantly forgetting due dates, then you have too many credit cards.
  • If you're paying annual fees on several cards but spend less than $25,000 per year on credit, you likely have too many credit cards.
  • If you're not paying your credit cards in full, you likely have too many credit cards. (The ideal number for you is probably just one 0% interest balance transfer card to pay off your debt faster.)

Otherwise, anyone who doesn't fall into these three categories, whether they have one card or 100 cards, is probably doing just fine.

Will having too many credit cards hurt your credit score?

Having several open credit card accounts does not directly affect your ability to borrow for other major purchases -- cars or homes, for example. In order of weighting, the factors that affect your credit score include payment history (35%), amounts owed (30%), length of credit history (15%), types of credit used (10%), and new credit and inquiries (10%).

Opening a new credit card account affects the fifth factor that goes into your score -- new credit and inquiries. Inquiries and their impact to your credit score are short-lived, however, and thus a new credit card account will have virtually no impact on your score and your ability to get credit for a major purchase six to 12 months after you open a new account. After two years, inquiries fall off your credit report entirely.

One simple rule can keep you out of trouble: Avoid opening a new credit account six months to one year before applying for a mortgage. Mortgage underwriters are notoriously fickle and the process has become tedious, as banks have bolstered their risk management practices after the Great Recession. Read more about how to bolster your score before applying for a mortgage.

Do you need a lot of cards to maximize rewards?

No, you don't need a plastic arsenal in order to get a healthy mix of credit card rewards. In fact, with just three cards, one can earn higher-than-average rewards on most categories of spending, all without paying an annual fee on a single credit card.

Below, I've compiled some of the best cash-back rewards available in several popular categories from no-annual-fee cards. With just three cards, one can earn at least 2% cash back on every dime of their spending.


Credit Card


5 points per dollar from Amazon Prime Rewards Visa Card* (equates to $0.05 per dollar spent)

Gas and grocery

3% on gas, 2% grocery from Bank of America® Cash Rewards**

Restaurants and travel

2% from Citi® Double Cash

Wholesale clubs

2% from Bank of America® Cash Rewards**

Everything else

2% from Citi® Double Cash

Data source: Card issuers. *Amazon Prime Rewards Visa Card requires a Prime membership. Shoppers who do not have Amazon Prime can use the standard card for 3 points per dollar spent at Amazon. **Bank of America® Cash Rewards bonus category cash back is limited to $2,500 of combined quarterly bonus category spend, after which the card earns at a flat 1% rate.

The cards above were not selected randomly. The table was designed to give preference to cards with no- or low-minimum-redemption requirements, so that the three cards are used in categories where they will earn the highest rewards and become redeemable the fastest. Note that each card has a redemption option that starts at $25 or less. Some cards have minimum redemption requirements that are as high as $100. 


Minimum Redemption

Amazon Prime Rewards Visa Card

None at; 2,000 points for $20 cash

Bank of America® Cash Rewards

$25 for cash

Citi® Double Cash

$25 for cash

Data source: Card issuers.

The three cards above allow a cardholder to optimize for cash back while keeping their wallets relatively light (three cards is just slightly more than the average American carries). That said, the bigger rewards come in the form of new cardholder bonuses, which can add up to hundreds of dollars in value for each new card opened.

Woman deciding between a handful of credit cards

Image source: Getty Images.

Pursuing new cardholder bonuses

Cardholders who are organized and diligent can extract more value from cards with large sign-up bonuses. Admittedly, this strategy shouldn't be pursued by people who consider themselves disorganized, or those who intend to apply for a mortgage or other large loan in the immediate future. Remember, it's best practice to avoid opening new accounts six months or so before applying for a mortgage so that you have the best possible score and a clean slate when your application goes through the underwriting process.

That said, people who have excellent credit can really rack up the rewards with sign-up bonuses. The table below shows some of the best sign-up bonus offers on the market today, both for cash and travel rewards cards.


New Cardholder Bonus

Spending Requirement

Annual Fee

Chase Sapphire Preferred®

50,000 points (worth $500 in cash or $625 of travel)

$4,000 in the first three months after account opening

$95, waived in the first year

Barclaycard Arrival Plus® World Elite MasterCard®

52,500 miles ($525 of travel)*

$3,000 in the first 90 days after account opening

$89, waived in the first year

Chase Freedom Unlimited®

$150 in cash

$500 in the first three months after account opening

No annual fee

Data source: Card issuers. *Bonus for the Barclaycard Arrival Plus World Elite MasterCard includes a 5% redemption bonus received when the 50,000 mile bonus is redeemed.

As you can see, the initial bonuses of annual fee cards can be especially lucrative for those who qualify for new cardholder bonuses, as the three cards above offer $1,300 in combined travel and cash value for meeting their minimum spend requirements.

Spending during the new cardholder bonus period effectively earns at a double-digit rate in cash or travel for each of the three cards. Chase Freedom Unlimited® earns at an astonishing rate of $0.315 per dollar on the first $500 of spending when the new cardholder bonus is included.

Credit Card

New Cardholder Bonus

Standard Rewards

Effective Rewards per Dollar Spent to Meet the Bonus Criteria

Chase Sapphire Preferred®

50,000 points

2 points on travel and dining, 1 point on all else

14.5 points per dollar on restaurants and travel, and 13.5 points on all other spending for the first $4,000 of spending

Barclaycard Arrival Plus® World Elite MasterCard®

52,500 miles*

2 miles per dollar

19.6 miles per dollar spent on the first $3,000 of spending

Chase Freedom Unlimited®

$150 in cash

$0.015 per dollar

$0.315 per dollar spent on the first $500 of spending

Data source: Card issuers. *Bonus for the Barclaycard Arrival Plus® World Elite MasterCard® includes a 5% redemption bonus received when the 50,000 mile bonus is redeemed.

As someone who has taken advantage of several new cardholder bonuses over the years, I can tell you that the new cardholder bonuses are by far the best way to rack up rewards quickly. Over the years, I've easily collected thousands of dollars in cash back, enjoyed free stays in hotels so nice I'd never be able to pay for them out of pocket, and gone on virtually every vacation on the credit card companies' dime.

Of course, I was only able to do that because I didn't carry a balance from month to month, and because I spend time carefully tracking my cards so as not to incur any unnecessary annual fees. It takes time to manage a list of cards to maximize sign-up bonuses, but the rewards can be more than worth the effort. A fear of having too many credit cards shouldn't hold back organized and financially savvy people from taking advantage of lucrative sign-up bonus offers.

Jordan Wathen has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Amazon. The Motley Fool has a disclosure policy. The Motley Fool receives compensation from some advertisers who provide products and services that may be covered by our editorial team. It’s one way we make money. But know that our editorial integrity and transparency matters most and our ratings aren’t influenced by compensation. The statements above are The Motley Fool's alone and have not been provided or endorsed by bank advertisers. Review The Motley Fool’s ratings methodology to uncover how we pick the best credit cards.