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How to juggle multiple credit cards like a pro

Allie Johnson

July 7, 2016

Your wallet may be crammed with credit cards you applied for to get credit in a pinch, earn sign-up bonuses or snag store discounts. There are benefits to having plenty of plastic, money experts say, but only if you manage your cards well.

The average American carries almost four (3.7) cards, according to 2014 data from CreditCards.com. But some people own more plastic: 9 percent have five to six cards, while another 7 percent have seven or more cards.

Having multiple cards gives you more flexibility when it comes to earning rewards and taking advantage of different card perks. But it also can lead to issues such as grabbing the wrong rewards card for a purchase, forgetting to make a payment or getting a card closed by the issuer for lack of use.

Here are seven tips for handling multiple cards like a pro:

1. Review your cards. First, do a “credit card census,” says Robert Manning, a finance professor and author of “Credit Card Nation: the Consequences of America’s Addiction to Credit.” Pull your credit reports from the three major credit bureaus, which you can do once a year for free at AnnualCreditReport.com.

Looking through your credit reports not only allows you to look for errors or negative marks on your credit, but also can remind you which accounts you have open. It’s easy to stuff a card in a drawer and forget about it, especially a retail card you opened just to get a discount, Manning says.

2. Consider paring down cards. If you have cards that don’t serve a purpose, weigh closing those cards, Manning says. For example, if you built or rebuilt your credit and still have a card with a very low credit limit, you might want to cancel it, he says. “Do you really even need a $500 limit card?” he says. And married couples should check to see if they have “redundant cards,” he adds. Just don’t close multiple cards at once; space them out to allow your credit score to recover after the loss of each credit line.

If you have one or more cards with an annual fee, do the math to see if the card is worth the cost. However, keep in mind that the FICO score factors in the age of your accounts, and older accounts can help your credit score. So, if you’ve had a card for 10 or 15 years, you may want to keep it open, Manning says.

“If you’re going to buy a computer or television, use a card that has purchase protection.”
— Robert Manning, author
of “Credit Card Nation”

3. Create a cheat sheet. Once you know which cards you’re keeping, create a chart to help you remember which cards you have and track the details of each account, says Liran Amrany, founder and CEO of Debitize.com. The service helps consumers use their credit cards like debit cards, setting aside funds to cover every purchase.

On your cheat sheet, list the card name, issuer, interest rate, annual fee, rewards information and perks, such as car rental or travel insurance, extended warranty and purchase or price protection.

When you go to buy an item, your cheat sheet can help you to decide which card to use based on rewards and perks. For example, if you’re booking a flight, pull out a card with travel perks, such as trip cancellation insurance and lost luggage reimbursement. And, “If you’re going to buy a computer or television, use a card that has purchase protection,” Manning says.

To remember which card offers the most rewards for the type of purchase you’re making, an award-tracking app like Wallaby can put that information at your fingertips on your phone, Amrany says.

4. Pick your go-to cards. Designate two, or at most three, cards to carry in your wallet for daily spending, Amrany says. Choose bank cards that offer rewards and valuable perks that fit your lifestyle and purchase patterns, he says.

For example, if you regularly travel internationally, make sure one of your main cards waives foreign transaction fees, the 3 percent fee some cards tack on when you make purchases abroad, he says.

5. Stow away secondary cards. If you have other cards, such as one with low interest that you keep on hand just for emergencies, secure those cards in a safe spot at home, Amrany says.

6. Organize payments. One of the biggest risks of managing many cards is that you could miss a payment, get hit with a late fee and sink your credit score, Amrany says. So, it’s crucial to review the monthly statements for every card you own, Manning says.

Also, consider streamlining billing by contacting each issuer to request that your due date be changed. You can switch all your due dates to the same day each month to help you remember.

Or, you can set up automatic payments to pay either the minimum due or the full amount due. To do this, you log into your card issuer’s site, add your bank account information and set up automatic payments, which allows your issuer to withdraw the set amount from your bank account each month so you never forget to pay.

“That’s a good idea for people who can be sure they’ll have enough money in their account,” Amrany says, adding that consumers who live paycheck to paycheck should avoid automatic payments. “You can get hit with multiple overdraft fees,” he says.

7. Use your cards regularly. You don’t want to let a card sit unused for many months because the issuer may close it for lack of use. “If anyone closes a card, it should be you,” Manning says.

Even if you’re keeping a low-interest card just for emergencies, you still need to use it occasionally to avoid having it closed. You could set calendar alerts every few months to remind you to use the card for a small purchase such as a tank of gas. Or, set up the card as your payment method for a recurring bill such as your cable or cellphone, Amrany says.

Finally, don’t carry balances. Carrying balances on multiple cards can be a recipe for debt disaster. If you’ve got a balance on one of your cards, switch to your debit card while you focus on paying down that debt, Manning says.

With credit cards, “the more complicated you make things, the more likely you are to have problems,” he says.

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