How to Manage Your Spending on Multiple Credit Card Accounts

Now more than ever, credit card companies are creating new product lines designed for very specific purchasing habits. Because of this, many credit holders are starting to rethink their spending and seek out multiple cards that are used only for certain events. But is this a good idea or just a way to get into debt quickly?

Managing your spending on multiple credit card accounts can be a daunting task that can end up leading you into debt. If you’re already there, consider using a debt consolidation loan calculator  to get your finances back on track. Here are a few ways you can pay close attention to your spending to manage multiple credit cards effectively.

Is it a good idea to have multiple credit cards?

You might wonder why someone would make their finances more complicated by using different cards for different purchases and if it’s worth the extra effort.

There are a few reasons someone might opt for using more than one credit card, including the need for more available credit and the ability to earn rewards. Some credit cards will reward you for spending on specific categories like groceries, gas, dining, etc. The rewards could be cashback, miles or rewards points, extended warranties, or something else that tempts users to prefer that premium credit card over others.

Many premium credit cards will charge an annual fee for the privilege of having the card. To some, these membership fees seem like a waste of money, but others see that the benefits can either significantly reduce or cancel out the fee altogether.

However, managing spending across multiple accounts can become a slippery slope that causes many to end up in debt. It takes discipline to use credit wisely, even if it’s only with one card, and adding more credit cards to the mix only makes things harder for those who can’t stay out of debt. If you can avoid debt, you may find that the benefits of having multiple cards outweigh the costs.

3 Tips to manage your spending across multiple credit cards

If you’re ready to branch out to multiple cards, there are a few things you should know that can help drastically reduce your chances of getting into debt or being hit with late fees and interest.

Have a default card that stays in your wallet

If you’re going to have more than one card for your purchases, then consider designating one of your cards as the “default” card that stays in your wallet. This card should have a good array of overall benefits, though it might not have the best perks for certain categories. However, if you forget the card that gets 5x points at grocery stores at home, this fallback card will still ensure you get something back as a reward for your spending.

Only use other cards when the benefits are worth the extra hassle

The biggest issue with managing multiple credit cards is staying organized and knowing which card will work best for each situation. It can get overwhelming quickly if you cannot stay on top of the benefits each card is eligible for. You might get occasional feelings of FOMO (Fear Of Missing Out) because you don’t have the premium gas or dining rewards card, but saving yourself the headache of juggling multiple accounts might be well worth the fewer points or statement credits.

Keep detailed records of your spending

Above all, you’ll need to stick to a budget and keep excellent records of your spending since you’ll be spreading out your purchases across multiple accounts. Use budget tracking software or even just an Excel spreadsheet to stay on top of your finances and ensure everything is paid off in time and in full.

The bottom line

As long as you stay organized and pay attention to your credit cards, managing multiple credit cards can be a great way to earn rewards, improve your credit score and increase your financial discipline.