Keeping a second credit card won’t lead to financial ruin, and may prove useful in several situations. Bankrate offers six reasons to stash away a spare card.
- 1. Financial safety: A well-placed backup card can provide crucial flexibility if your wallet is stolen.
- 2. Rewards: Want both cash back and miles, but don’t want to choose? Have one card for each.
- 3. Credit score boost: Your credit score takes an initial hit after opening any new credit line, but by maintaining a reasonable debt to credit ratio over two credit lines, you can actually improve your score over time.
- 4. Staggered bill paying: Ultra-savvy penny pinchers can arrange their cards “so one of his or her credit cards has a billing cycle that ends on the 10th of the month and another that ends on the 25th. If that you pay careful attention, you can use the first card for purchases shortly after the 10th and the second one for purchases shortly after the 25th, maximizing the amount of time in between the purchase and when the bill must be paid.”
- 5. Easier bookkeeping: Save trouble during tax season by keeping all your business expenses neatly itemized on one card.
- 6. Leverage: Bankrate argues that you can use the favorable terms on one card to leverage better terms from other lenders. Threatening to leave for greener pastures doesn’t require a second credit card. In fact, consumers can often receive better terms just by asking.
Bankrate argues in favor of “multiple” credit cards, but let’s not get carried away. Very few people need more than two cards. Regardless of how many cards you have, be sure to pay all of them off in full every single month.
Do you keep more than one card? Tell us how you use the spare in the comments.
6 good reasons to carry multiple credit cards [Bankrate]
(Photo by Jeff J Mitchell/Getty Images)