Originally Posted by
camhabib
As the title implies, how many is generally considered too many, when talking about credit scores and maintaining a good one?
First, #1 is pay on time. Never miss a payment.
The number of cards with activity may be more important than the total number, up to a point. If you have some larger number of cards but only show a balance on 2 cards that's different than showing balances on all.
A note on 'showing a balance': Even if you pay it all off when you get your bill, you will show a balance carried. If you pay a day before your card closes, then you probably would show zero balance.
Cards with no activity may be closed by the issuer. It's probably better if you close them yourself, or charge something every 6 months and pay it off to make sure card stays open.
1% to 9% is the target per card and total for a balance to carry for best score. Over 10% isn't the end of the world, but 90% isn't going to help.
How long should one generally keep a card open before closing it, if ever?
The longer you have an account, the more it helps your Average Age of Account. So don't close the AMEX; if for some reason you must, you should try and convert it to a gold or green.
Also, on the charge cards, the more you have, the lower your total revolving utilization is. Example: you have $2000 outstanding on $10,000 total credit. If you did nothing else but ask for Credit Line Increases (CLI) say to $22,000 total credit, you'd reduce your utilization from 20% to just under 10%. (The CLI's would generate hard pulls, which would low your score, but the reduction in utilization could raise your overall score.)
Any new creditor could be nervous if you have too much credit relative to your income, and may decline you for that reason, and not your score. This would be a reason to close accounts, but some folks suggest you don't do this until you've actually been turned down. It could be also something to analyze before you apply for a real estate mortgage.
Your score matters when you want to apply for new credit. If you want to be able to jump on a hot deal, you want your credit report to be show you're worthy. If you're not planning on any new credit in the short term, then just pay on time and let your accounts age.