Should you or shouldn't you own multiple credit cards?
We all know that a credit card is like a two edged sword, but if used wisely the benefits outweigh the drawbacks. Banks offer the best credit cards in UAE and all of them seem to be offering something better than the other. With many lucrative offers on different cards, it becomes quite difficult to make a choice and therefore, people often end up procuring more than one credit card. But, how many credit cards should one possess or is it good to own more than one credit card are some questions that need to be addressed.
However, before we deduce any conclusion let us consider the pros and cons of having more than one credit card-
Pros of Having Multiple Credit Cards
- Multiple rewards and offers- One of the most obvious benefits of owning a credit card is that you can take advantage of various rewards and schemes. You may use the card that offers the best shopping rewards at the clothing store and the one will travel rewards to book your flight tickets. If you know how to use a credit card wisely, you would know how to get the most out of them.
- Peace of mind - When you possess more than one credit card and one of your credit cards is declined or damaged you still have the option to use others. Also, it may happen that when you travel abroad only particular credit cards tend to work, making it easier for you to carry out transactions on the foreign land. Being able to carry out smooth transactions on a foreign land offers confidence and peace of mind.
- Improves credit score - Your credit score is something that reflects your financial stability and your credibility to make timely repayments. Having more than one best credit card in UAE increases your total spending limit and distributes the expenditure among various cards, further improving your credit card score.
- Transfer balance easily - Credit card issuers let the credit card owners transfer their unpaid balance to other cards at a minimal rate of interest. This money transfer can be used to repay the debt or another credit card as well. However, remember that this must be practiced only during emergencies as you can still end up in debt if you are unable to reply bill of any of your credit cards.
- Can be an alternative payment option - Cashless payments are quick and easy, but I am sure that even you would have faced a technological glitch at times. It may happen that even one of your best credit cards in UAE may not work due to a technological issue. In such a case having more than one credit card pays off. You can easily use another credit card to pay for the transaction.
Cons of Having Multiple Credit Cards
- Makes you confused – More is the number of cards, the more complicated your financial life becomes. The number of billing cycles increases and you need to remember a lot more payment dates to prevent interests. Also, if you spend using more than one credit card you may get confused or stressed out.
- There is a risk of debt – When you have more than one credit card, you become prone to overspending. Since all your cards have different limits, you may end up spending more than the amount you have in your pocket; leading to debt. This money may become a trouble to repay and negatively impact your financial status.
- Negative impact on credit score – Your credit score reflects your financial stability and therefore, even if you are unable to repay the bill from one credit card, it will cause a drop in your credit score.
If you possess one or more credit cards it becomes your responsibility to ensure that you do not end up spending recklessly and gathering a lot of debt. The best credit cards in UAE offer you the financial freedom to spend when you are low on liquid cash, but at the same time make you liable to repay the amount spend. So even if you have one or more than one card, the benefits can be innumerable if used wisely.