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I Have 20 Credit Cards — This Is How I Keep My Credit Score Above 800

How you manage your credit cards is the key to unlocking good credit scores.

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A lot of people believe the number of credit cards you open has a big influence on your credit scores. While it’s smart to worry about the actions that impact your credit, here’s the truth: There’s no perfect number of credit cards when it comes to your credit score.

My credit score crossed the 800 mark for the first time when I was in my 20s. (On a FICO Score scale of 300 to 850, a score of 800 or higher is considered exceptional.) At the time, I had around five credit cards open. Since then, my number of open credit cards has climbed to an even 20, and my score still regularly stays above that 800 threshold. Here’s how I do it.

How Credit Cards Influence Your Credit Score

Although the number of credit cards you have has little to no influence on your credit score, they can affect your credit in other ways. One of the reasons I earned an exceptional credit score in my 20s is because I learned which actions matter as far as credit scores are concerned.

A credit card could impact your credit score in five different ways.

  • Payment History: 35% of your FICO Score is based on whether you pay your credit obligations on time. I’ve never had a late payment reported on a credit card (or anything else). This helps my credit score stay high.
  • Credit Utilization: Credit utilization (aka balance-to-limit ratio) is largely responsible for 30% of your FICO Score. My credit scores stay healthy because my reports show I use a small portion of my credit card limits.
  • Age of Credit: The age of the accounts on your credit reports can impact 15% of your FICO Score. Older accounts are better. I don’t open too many new accounts in a short period of time because it could lower the average age of my credit. But I’m also not afraid to apply for credit when I need or want it.
  • Mix of Credit: Your ability to manage multiple types of accounts can affect 10% of your FICO Score. Having revolving accounts (like credit cards) and installment accounts (like my old auto loan) on my reports helps me here.
  • Inquiries: Applying for new credit could potentially hurt your score, but usually not much, and sometimes not at all. Hard inquiries (those that might damage credit scores) only influence 10% of your FICO Score. I spread out applications over time and only apply for new credit when I truly need or want it.

Why I Have Multiple Credit Cards

You might wonder why I want this many credit cards — especially if you personally only carry a few cards or perhaps none at all. I can tell you that I didn’t open my credit cards for the purpose of financing anything.

I didn’t open a credit card to pay for a vacation, cover Christmas shopping or take care of a large expense. If I had, my credit scores may have suffered along with my bank account balance due to expensive interest fees. Credit cards just aren’t typically an affordable form of financing. (The average credit card interest rate is currently over 17% for accounts that assessed interest, per the Federal Reserve.)

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Personally, I opened a well over a dozen credit cards for two reasons. In college, I used credit cards to help establish credit scores. Once my credit was in good shape, I opened more accounts to take advantage of valuable reward offers.

My Credit Card Strategy

A big portion of my spending each month goes on the following three Chase credit card accounts. I frequently use these cards because they give me the opportunity to earn more points in different spending categories. Then I can transfer all the points to one card and get up to 50% more value when I use the them to book travel through Chase’s Ultimate Rewards portal.

  • Chase Sapphire Reserve®: I opened my Chase Sapphire Reserve largely because of its generous sign-up bonus. (The current bonus is worth 60,000 Chase Ultimate Reward points after $4,000 in purchases during the first three months after account opening). I still use the card frequently because it lets me earn 3X points on travel and dining purchases. Add on the travel protection benefits and the $300 annual travel credit, and it’s easy to see why the Chase Sapphire Reserve is one of my favorite cards, despite its $550 annual fee.
  • Chase Freedom® Flex: Before it rebranded as the Chase Freedom Flex, I had the original version, the Chase Freedom credit card, for many years. Still, to this day, I remain a fan of the card, which has no annual fee, because each quarter it offers me a 5x bonus category to get more value from my spending (up to $1,500). Currently, I’m using the card to get 5% cash back when I shop at department stores, with PayPal or using Chase Pay. However, the card only earns 1.5% cash back on everything else. So I leave it in my wallet for any purchases outside of the current bonus categories.
  • Ink Business Preferred℠ Credit Card: More recently, I opened the Chase Ink Business Preferred and earned 100,000 bonus points after I spent $5,000 in the first three months (which was the sign-up bonus at the time). The card, with its $95 annual fee, offers me 3x points on travel, shipping, internet, cable, phone services and advertising on up to $150,000 in spending each account year.

Bottomline

The best rewards credit cards are a great way to get extra value out of purchases you need to make anyway. But they don’t work to your advantage if you use them the wrong way. It’s essential to pay off your balances every month. Otherwise you’ll waste a ton of money on high interest fees. And you risk damaging your credit scores.

Ultimately, it’s not about how many cards you have, it’s all about how you manage the accounts that show up on your credit report.

While we work hard on our research, we do not always provide a complete listing of all available offers from credit-card companies and banks. And because offers can change, we cannot guarantee that our information will always be up to date, so we encourage you to verify all the terms and conditions of any financial product before you apply.

Michelle Black
Michelle Black is founder of CreditWriter.com and HerCreditMatters.com. Michelle is a leading credit card journalist with over a decade and a half of experience in the financial industry. She’s an expert on credit reporting, credit scoring, identity theft, budgeting, small business, and debt eradication. Michelle is also a certified credit expert witness and personal finance writer.

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