How many credit cards should I open in a year?

How many credit cards can you open?

10,000 miles signup bonus. 5% cash back for the first year. 0% introductory APR on purchases and balance transfers.

Credit card companies attract customers by offering generous signup bonuses and offers to cardholders during the first year the account is open. Now, you might wonder: with all the great rewards and bonuses offered by these credit cards, can I just apply for as many credit cards as I want? The short answer is yes, you can. But, opening too many credit cards isn’t recommended, as it can become difficult to track all the various cards you own. 

What to know before you apply for many credit cards

First, cardholders with excellent credit scores will be more likely to get approved for certain credit cards than those with low credit scores. This is important to remember because when applying for a credit card, companies will do a “hard inquiry” into your credit score, which will lower your credit score. 

Hard inquiries are conducted when you apply for a credit card, mortgage, auto loan, student loan, or business loan. These inquiries deduct a small part of your credit score (about 5 - 10 points) and will show on your record. The more you apply for a credit card, the more hard inquiries are pulled into your account. As a result, your credit score may go down a bit if you apply for many credit cards.

So, if your credit score is not as high, it may be worth using a card specifically designed for rebuilding credit before shopping for other credit cards. 

In addition, it may be difficult to keep track of all the credit card accounts open when you have too many credit cards. Nowadays, most cards charge late fees for any late payment, and this could definitely add up over time! It’s best to only open a manageable number of credit card accounts so you can keep track of all the payment dates and pay your balances on time.

Certain Exceptions

Credit card companies understand that some people open credit card accounts just to earn the signup bonus. They simply spend the required minimum amount to earn the bonus, then become inactive on the card.

To combat this, Chase has created a new policy to make it harder for cardholders to open many accounts in a short period of time. They do this in hopes of only encouraging active card members to use a Chase credit card.

Citi bank has also rolled out a policy that prevents cardholders from earning a signup bonus if they have opened or closed a card account within the same credit card family during the past 24 months. So, cardholders looking to open many credit card accounts to earn signup bonuses will be restricted from doing so by many credit card companies.

Conclusion

While there is no technical limit to how many credit cards you can open if you have a good credit score, it may not always be in your best interest to do so. Opening too many card accounts will make it difficult to keep track of all your payments, and credit card companies have taken steps to prevent people from using credit cards only for the signup bonuses. Not only will it be harder to monitor fraudulent purchases on your account, but your credit score might also take a hit if you apply to too many credit cards. Nonetheless, opening many card accounts also has its benefits: you can earn rewards on various categories and have access to many services and protections. So it’s okay to open multiple credit cards but just keep in mind that there is such a thing as too many credit cards.