Is It Worth Having Multiple Credit Cards to Maximize Rewards?

Different credit cards have different rewards programs. Should you get several to earn the most possible rewards?

Credit card companies compete for customers by offering generous rewards programs, leaving consumers with almost endless choices when it comes to picking a card to use. You have cash back cards, as well as cards that provide points for miles or other rewards. You can also pick from cards that reward different kinds of spending, such as travel, gas, groceries, or dining out.

Since some of the most generous rewards cards provide bonus cash back or points only for very specific purchases, you may be wondering whether it makes sense to have multiple credit cards in order to maximize the rewards you could earn. You could use one card when you go to restaurants, for example, and another when you book your trips or shop on Amazon.

But does this strategy of having multiple cards really make sense, or is it not worth the hassle? These questions will help you decide. 

Traveling woman using credit card

Image source: Getty Images

How much do you spend on your cards?

If you use your credit cards religiously for every purchase and you tend to spend a lot on certain categories of purchases, it makes more sense for you to carry different rewards cards. High levels of spending will enable you to earn rewards quickly on each card. And with more spending, the quality of the rewards program matters much more.

If you only charge $100 a month in groceries on your card, for example, the difference between getting 1% back and 3% back is only $2. But if you charge $1,000 a month on groceries, then the difference is $20 a month -- which adds up to $240 a year. That's not nothing. 

Your annual spending is also an important consideration because many of the best rewards cards come with annual fees you have to pay. If you must pay a fee to earn generous rewards, you'll need to ensure you're actually spending enough to cover that cost and still make a profit. And if you have multiple cards that each charge you, your spending would need to be even higher to justify paying for each one. 

Do you spend on lots of different categories of spending?

Some people tend to concentrate their spending on particular types of things. If you're a real foodie who spends a fortune at restaurants but you rarely spend on travel, grocery stores, gas, or other categories, it doesn’t make much sense to get multiple cards. One card that rewards you heavily for dollars spent at restaurants is likely sufficient.

But if your spending is all over the place and you tend to spend around the same amount on gas, trips, groceries, and other common bonus rewards categories, it can make sense to have cards that offer bonus rewards for the different kinds of shopping you do. 

Are you interested in juggling multiple card rewards programs?

There are lots of people who love to maximize their credit card rewards points. They read reviews, open new cards all the time, and are more than willing to sign up each quarter to get bonus cash back in certain spending categories. 

But there are other people who don't want the hassle and who barely spend the points they earn. If you fit into the second category, signing up for multiple cards would make little sense. You likely wouldn't want to carry multiple cards, wouldn't remember which ones to use for which purposes, and might not be inclined to activate your bonus rewards. 

What cards can you qualify for?

If your credit isn't great, you may not be able to get approved for many of the best rewards cards. If this is the case, your focus should likely be on building credit rather than maximizing rewards. 

You may not want to apply for too many credit cards, as this could lead to lots of inquiries that damage your credit score further -- and wouldn't help you anyway if you don't end up getting approved. 

Having multiple credit cards can be worthwhile

Ultimately, you'll need to consider your spending habits and your typical credit card use patterns to decide if you're better off having multiple cards or just finding one great rewards card. Whatever option you choose, be sure to research the card or cards that will provide the best bang for your buck given the kind of spending you do the most. 

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The Motley Fool owns and recommends MasterCard and Visa, and recommends American Express. We’re firm believers in the Golden Rule. If we wouldn’t recommend an offer to a close family member, we wouldn’t recommend it on The Ascent either. Our number one goal is helping people find the best offers to improve their finances. That is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.

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