POLL: Too many credit cards can be good or bad

Some say four credit cards are too many, others say 15.

FICO data finds that the average American has 2.6 credit cards in their name, but individuals with the highest credit scores have seven credit cards on average.

Financial Advisor and author Gary Sirak said just keep up with payments.

“Common sense is don’t buy something you can’t pay for. So, if you put it on your credit card, just know that you have to have that thing paid it off because the 25, or 20 percent interest, or 18 percent, whatever it is, they just eat your lunch,” said Sirak.

He said credit card companies use teaser rates, starting you out at a much lower rate and then after six months boost it much higher. And, the interest rate trap is a losing battle because payment history is the single most important factor in determining your credit score.

“If you’re paying all your bills on time, you can lower your (credit) scores. If you don’t pay your bills on time, it really can slam you,” said Sirak.

Applying for a lot of new credit cards can also lower your credit score because it shortens the average age of your credit accounts.

But, multiple credit cards will increase the amount of credit available to you. If you don’t spend more than usual, your credit utilization ratio will go down.

Closing older credit accounts can bring down your average account age. It also raises your credit utilization ratio by lowering your available credit.

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