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I have one credit card, which is the only line of credit that I've ever had. I've never missed a payment, keep my credit utilization ratio reasonably low, and haven't had any other negative impacts on my credit rating. As such, my credit rating is consistently in the high 700s, but I'd like to get it over 800. On sites that break down my credit score, the only negative contribution is that I don't have enough credit accounts open.

Would it help (and otherwise be a good idea) to open a second credit card just to improve my credit score by increasing my number of credit accounts? I wouldn't do so for any other reason; I would find it a minor hassle to keep track of multiple credit cards, and I personally prefer keeping my finances simple over figuring out how to maximize my rewards. I don't plan to open any installment credit account (car loan, student loan, mortgage, etc.) for the foreseeable future. (But I will eventually, which is why it'd be nice to boost my credit rating.)

I'm not actually sure how much a second credit card would even help my credit score. I read somewhere that a mixture of revolving and installment credit accounts helps your credit score more than multiple revolving accounts do. And another site said that ideally you should have at least 10 credit accounts, which sounds insane to me and is way more than I'd prefer to deal with.

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  • If your credit score is in the high 700s, then you're already in the Excellent range, and there's no reason (except pride) to bump it higher. The exact range for Good, Very Good, Excellent, etc depend on which score you look at. – RonJohn Dec 29 '20 at 3:53
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    I definitely recommend having a second CC as security in case you lose your card or it gets stolen, or if someone swipes the numbers and uses it online. Sure, the card company will send you a new one in a week or two, but in that time you don't have a card. – RonJohn Dec 29 '20 at 3:56
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Your credit score is already excellent, and increasing it from here will not help you in any meaningful way. In my opinion, you should not do anything you don’t really want to do in an attempt to increase your already excellent score.

You need to be suspicious of advice from places like Credit Karma when they tell you that you need more credit cards, because the way those free-to-use sites make money is by referring people to credit card applications. Those sites will always tell you that you need more credit cards. There are lots of people on this site, including both me and you, who have high credit scores with a small number of credit cards.

Having said all of that, I will tell you that I personally had just one credit card, like you, for a number of years and resisted getting a second one just as you are. However, I travel occasionally and ran into a couple of situations where a second credit card would have been useful. Once in a while, no matter how careful you are protecting your card number, your account will be compromised and the card will need to be canceled and reissued with a new number. This isn’t a big deal when you are home, but it becomes a much greater hardship when it happens while you are on the road living in a hotel. Having a second credit card makes the few days it takes for the bank to ship you a replacement card much easier.

Another situation I recently had was trying to buy gas for my rental car while out-of-state. When I swiped my primary credit card at the pump, for some reason the credit card company decided it was suspicious and denied the charge. They sent me a text asking if it was me, but I didn’t get that text until a few minutes later. Luckily, I had my other card, so I just used that one and was able to fill up.

To answer your question, if your only goal is to “improve [your] score by increasing [your] number of accounts” and you “wouldn’t do so for any other reason,” than my advice to you is don’t bother. But I have found having a second, backup credit card with no fees to be useful for me for other reasons, and you might want to consider it.

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    This is a terrific answer. – Fattie Dec 29 '20 at 14:40
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Should I open a second credit card just to improve my credit score?

No.

But if your question had been:

Should I open a second credit card?

I'd say yes, probably. Your credit score is great. Don't worry about your score. You said:

I wouldn't do so for any other reason; I would find it a minor hassle to keep track of multiple credit cards, and I personally prefer keeping my finances simple over figuring out how to maximize my rewards.

That's a fine line to draw in the sand, but here are some reasons to consider multiple cards:

  1. Some places only take Visa (Costco). If your main card is MC I'd consider getting a Visa too. The reverse used to be true too (Sams Club accepted MC but not Visa), but I don't know of any places where that is still true. But I'm sure it is somewhere.
  2. As already mentioned in Ben Miller's answer, it's nice to have a backup card in case your primary card is declined, lost, stolen, etc. Especially while traveling.
  3. Usually you can get better rewards with different kinds of cards. For example, my wife has an Amazon Visa so we use that for all Amazon purchases and we get 5% back, a Target card for 5% at target, and we use my Citi double cash MC which is 2% on all purchases for most everything else (except we also use the Visa at Costco).

#1 and #2 are pretty inconvenient when you experience them (though if you always have a debit card with you it's probably not a big deal, but protections are less on debit cards; personally I rarely carry one.) I know you said #3 isn't important to you, and I guess that depends on your spending. I'd guess my family saves between $100-$300 per year by having the 5% versus 2% on certain cards.

The key to managing multiple cards is to set up auto (at least minimum) payments on every card, and alerts (text/email) on every transaction. This way you'll never miss a payment and you'll know if any card is ever compromised within minutes.

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    Exactly. Not for credit score, but to maximize benefits on the money you already spend. My 2% cash back card funded the last 2 years of my daughter's college in full. The Amazon card, I just treat that as a 5% discount. – JTP - Apologise to Monica Dec 30 '20 at 0:47
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    The whole answer is great, but this stuck out to me: "set up auto (at least minimum) payments on every card". No matter what happens, your cards will never have a late payment. I gave that exact same advice to my son. – RonJohn Dec 30 '20 at 2:38
  • @RonJohn I wish my dad gave me that advice when I was younger. I had a 30-days late payment once on a CC in my early twenties after I moved and didn't get the bill in the mail, and that hurt my credit score (slightly) for 7 years. Though, I can't remember if auto-payment of the minimum was even a thing back then... – TTT Apr 15 at 17:01
  • " I can't remember if auto-payment of the minimum was even a thing back then..." That requires auto-draft; when did that become common? – RonJohn Apr 15 at 20:24
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Speaking as someone who used to have multiple credit cards and now has no credit cards, I know just how easily and quickly credit cards can turn into very bad things.

My credit score was around 750 the last time I checked it earlier this year when I bought a house, and I haven't had a credit card in over 10 years. I use a debit card from my credit union as a credit card, but that still comes out of my available funds in my account, rather than it being a loan. In fact, the only revolving credit I have right now is PayPal credit, which I haven't touched in years.

Quality over Quantity

What matters more on your credit history is how you use the cards, rather than the quantity of them. If you use them poorly, they will drag your score down quickly. If you apply for a bunch of them, your score will dip (although temporarily). If you simply have them and don't use them, they don't really do anything for you. And if you use them often, it can again negatively affect your credit by having a high usage, affecting your "debt to income ratio".

The only way credit cards help you is if you use them only a little or moderately.

However, keeping low balances on just a few credit cards can result in very good credit scores. So, improving credit scores alone is not a good reason to apply for a bunch of new credit cards. And, you should always have a good reason for getting a new credit card.

https://www.experian.com/blogs/ask-experian/getting-more-credit-cards-to-help-credit-scores

My Experience

My venture into credit card hell was during college. I had low limits and a low to non-existent income. I used the cards to try to pay for college expenses, when the financial aide and student loans didn't cover them. And they quite often didn't cover it all. My cards got maxed out quickly and my lack of income meant that I couldn't pay them off, or even make minimum payments most of the time. It took me years to pay off the $200-$500 I had on some of them. Some of them also closed my accounts while there was still a balance, which is a fairly major no-no when it comes to credit history.

I talk about reasons why to keep credit cards fairly extensively in this Answer, but it's not a reason to get new cards. This Answer is more about keeping some credit cards you already have and getting rid of the rest, which isn't your situation. It's still good info to know about how to use the credit card you currently have, though.

Paying off debt and living within means vs. long term planning

Employment

Don't rely on being employed full time. If this year has taught us anything, employment isn't guaranteed. With the unemployment rate in the US shooting to a record high of 14.7% this year (over 23 million people), it shows that nearly anyone can be unemployed at any time. And 7 months later, we're still at 6.7%, which is nearly twice was it was before Covid-19 hit.

https://www.bls.gov/opub/ted/2020/unemployment-rate-rises-to-record-high-14-point-7-percent-in-april-2020.htm?view_full

https://www.bls.gov/news.release/pdf/empsit.pdf

I could get into unemployment insurance, but that would lead to a political debate right now, so I'm going to skip that. But those benefits aren't going to pay for credit card payments, either, even when they are available.

Yes, you can use the credit cards to tide you over during a bout of unemployment, but they can also drag you down quickly to the point where it take you longer to pay them off than it did to rack up the debt. It's much easier to reduce your spending during unemployment if you don't have credit cards. I know this from experience, too.

Credit card debt

For some fast statistics, there are roughly 331 million people in the USA. If we average out the $820 billion credit card debt across everyone, including babies, that's nearly $2,500 per person. In fact, there's around 1103 million credit card in the US, or an average of just over 3 cards per person, including babies again.

https://www.statista.com/topics/1118/credit-cards-in-the-united-states/

https://www.census.gov/popclock/

Of course, those averages are nearly useless data. Some people will have +$20k across 15 cards and some people won't have any cards. And many people can't make their payments. These are usually the people who thought having a bunch of card would be fine. They could pay one card with another card, or they'd never use the cards, or they only got the card for the 0% interest, or the cash back, or 1 of 100 other reasons that didn't pan out for them.

Unless you are extremely disciplined, are rich, are lucky, or simply never buy anything, you are almost guaranteed to be better off not having multiple credit cards. Sure, you'll find people that made those credit card work for them, but for every 1 of them you'll also find +100 people where it didn't work.

Conclusion

While there are some few benefits of having multiple card, including possibly helping your credit score, the probability of hurting your credit history and getting yourself into uncontrollable debt is very high.

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Just relax! Your credit score is great and you don't need to open another credit card.

However, there is no ideal number as such that can be recommended to any individual when it comes to credit cards. Although having a few cards can be a real blessing, too many of them is not a desirable thing as you can spell trouble in ways more than one. This is a subjective decision and demands your discretion to arrive at the correct number.

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