How can I Manage Multiple Credit Cards

Credit cards are powerful financial tools but can also put you in a situation of debt trap if these credit cards are not used responsibly. This situation generally arises when credit cardholders do not pay their credit card bills in time and in full and also when they choose the wrong credit card for themselves. Hence they fall into the vicious circle of debt from which it sometimes gets difficult to get out of. Therefore, to avoid such situations, people generally opt for multiple credit cards which matches their spending pattern and also offer differential interest rates.

While some credit cards offer benefits on fuel, while with other credit cards you may get cashback while performing certain transactions. Hence, this is the reason why people opt for multiple credit cards.

However, with the advantages of having multiple credit cards, there are disadvantages as well. It sometimes gets difficult to manage multiple credit cards as sometimes you are not able to keep a track record of all your credit cards. If you don’t keep a regular check on these cards, the debt might keep on accumulating, and hence, at the end, making it difficult for you to pay off your credit card bills. Therefore, you just don’t need to own multiple credit cards, you should also know how to effectively manage these credit cards so that you can get the maximum benefit out of these credit cards.

Ways in which you can manage multiple credit cards

By choosing the right credit card

The first and foremost way in which you can manage multiple credit cards is by choosing the right credit card. You should opt for that credit card that matches your spending pattern, your financial aspects, etc. You should always opt for a credit card that will provide you with the maximum benefit. Therefore, you should consider the points mentioned below before you choose a credit card –

• One of the major factors that should be considered before getting a credit card should be the interest rate that the credit card carries along with it. This is because if credit cardholders fail to pay the bill amount by the due date, then they will have to pay an amount that will be equal to the bill amount plus the interest portion on it. The interest rates on credit cards differ from card to card and bank to bank. Cardholders should do detailed research on credit cards before finalizing a credit card. Therefore, the lesser the interest rate, the better it is.
• Second thing that should be taken care of is the fees and other charges linked to a credit card. The credit cards that provide a higher credit card limit generally charge a higher joining and renewal fee. Therefore, to avoid such situations, you should well consider all the fees and charges and read the terms and conditions linked to a credit card before opting for a credit card.
• Prospective applicants should also go through the benefits and offers that credit cards provide. On all the transactions that you do using a credit card, cardholders will either earn reward points or cashback. Therefore, such a credit card should be opted that provides you the maximum benefit while transacting using a credit card.

Keep in mind the credit limit of each credit card –

In the case of multiple credit cards, credit cardholders should keep in mind the credit limit of each credit card. You should not unnecessarily keep using the credit card without considering the credit limits and without understanding the fact that you have to pay the bills as well.

• Manage your finances –

Another important aspect while managing multiple credit cards is you should know how to manage your finances using multiple credit cards. Sometimes, you keep on transacting using your credit cards without thinking and then at the end there is a huge amount of bill that has to be paid and at times it gets difficult as well. Therefore, you should plan your finances using a credit card in such a way that you pay your bills on time as well.

• Reminders for bill payments –

While you have multiple credit cards, they have different bill payment dates as well. In order that you do not forget the bill payment dates of the multiple credit cards, you should set up constant reminders regarding the billing date of each credit card so that you do not forget to pay the bill of any credit card and in turn attract any interest charges and late fee charges.

Bottom Line

It is not at all bad to have multiple credit cards but credit cardholders should know the tricks as to how they can effectively use their multiple credit cards. Cardholders should not blindly keep spending using their credit cards but try to keep the credit utilization ratio below 30%. Going above this % can ruin the management of your finances. Therefore you should take care that you use your credit cards smartly in such a way that you gain maximum benefits out of these multiple credit cards.