Is it Advisable to Have Many Credit Cards And Bank Accounts? 

It is not strange to find a person with stacks and stacks of credit cards - all these are active, mind you. This is because there are a lot of credit card companies nowadays that make it easy to own credit cards. They also make it really attractive with added perks as rewards points and mileage credits. You can even have multiple credit card types from the same issuer.

In the coming days, you might even find a package with a pre-approved credit card in your mailbox. Your stack might also include ATM cards and debit cards from several of your bank accounts. These accounts may or may not have been opened in connection with your credit card accounts. Or, maybe some of your plastic cards were issued to you because you have an account with the issuing institution. Is it advisable to have lots of accounts and credit cards?

In as far as bank accounts, it really does not make sense to keep several of the same types of account. Financial managers would advice that you open one account for your revolving fund, another one for your emergency fund, and probably a couple of others for your long-term funds. Your revolving fund could be your simple ATM account or your checking account. There are some banks that offer both conveniences in one account. This is your transactional account - some would call it your wallet account. Your emergency fund could be kept in a time deposit or a special savings instrument with a tenor that you are comfortable with and that earns interest that is a bit higher than your savings account.

For your long-term funds, you can consider higher-yielding instruments like fixed tenured special high rate offers that your bank could offer from time to time. You need not keep all your accounts in one institution. In fact, it could be dangerous to keep all your eggs in one basket as they popular adage goes. Having about three to five accounts with different banks in total would be just right provided that these are different types of accounts. It would be a nightmare to monitor and balance five checking accounts.

Now, credit cards are a different matter. There really is no cap as to how many charge cards you should own. Heck, some credit card companies can give you a new one even if you do not have a good credit score. But then again, you should be wise about owning and using them. If your credit record is clean thus far, there really is no reason why you should start acting irresponsibly and start smearing it. Having a lot of plastic cards do not automatically give you license to go on a wanton spending spree. You can actually use multiple plastic cards to your convenience.

Being able to manage spending on several cards and making payments on them as they fall due can do wonders for your credit record. The number of cards you own does not matter as much as the amount of outstanding unpaid balance you have on all of them. While one or two cards is really all that you need, it really does not matter much how many bank accounts and plastic cards should you have for as long as you are able to manage all of them well enough not to put you on the negative side of your personal financial statement.

It is best to remember that these financial instruments are supposed to help you manage your money. You should not end up losing money in the long run. Prudent use of these tools will allow you to save more of the money that you earn and earn more from the money that you save.

So, how many bank accounts and plastic cards should you have? Only as much as you could handle properly!

by Peter Lisdorf.

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