Kids and teenagers of this generation grew up thinking that a person with lots of credit cards were cool and rich. Seemed like a person really had to be someone special to have all of that plastic. As these kids and teenagers grew older into young men and women, most have realized that a person with a ton of credit cards is a fool. They are most likely a person who is in debt and is having a difficult time making all of those credit card payments. Believe it or not, there are people who have 20 or more credit cards. They will have lots of different Visa cards, MasterCards, Discover Cards and many others. If you really put some thought into this, a wealthy person would not ever need this many different credit cards. If a person had a good credit history and made a large amount of money, they would be able to get a credit card with a very large credit limit. It would be the only credit card that they need. The person with 20 or so credit cards most likely has small credit limits on each one. $300 limit on this card, $500 on that card, $1000 on their oldest card and so on. This is a big problem that will one day haunt them.
Having too many credit cards automatically has a negative affect on a consumer's credit report and will keep their credit score lower than what it could be. Sure, it is great that all payments are being made on time every month, but when a person has too many open accounts, it is never a good thing. A person's credit score is basically a scale of what risk a person is of non-payment. When there are lots of open credit cards, this will naturally make a person a higher risk of defaulting on their credit cards.
A person should never have more than five or six credit cards. Some experts feel that even this is too many. For those who are trying to rebuild their credit or are starting out with their first credit card, one credit card is enough. As years go on and money management skills improve, three credit cards should be fine. It can be tempting to open up new retail store credit card accounts when a store is offering a promotion or sale for their credit card holders. A person will need to be disciplined or else they may find themselves in a mess one day when they find themselves having 20 open accounts.
Credit cards give people a false sense of security. Sure, they can help a person out in times of need, but does that person have the financial means to pay it back? Credit card companies have long gotten themselves and their customers in trouble by handing out credit cards like candy. Besides that, the credit limits that they give some people are far too high than what a person can afford. Remember, credit cards companies are a business that wants to make money. They need to stay profitable to run their operation. They can do a great deal of good for those who are responsible enough to manage their money properly. A person just needs to be wise when they are deciding whether to open up a new credit card account or not.
