I used to feel overwhelmed juggling multiple credit cards in my 20s until I figured out a better way to manage them. If you’ve accumulated several credit cards but don’t know how to organise them or maximise their benefits, you’re not alone.
In this blog, I’m sharing practical and easy steps to declutter your credit cards, avoid unnecessary fees, organise your wallet, and keep your credit score healthy. Whether you want to improve your credit card management skills or just get a grip on your finances, this guide is for you.
Why Do People End Up with Too Many Credit Cards in Their 20s?
It’s common to apply for multiple credit cards early in your financial journey. Banks and credit card companies offer attractive sign-up bonuses, rewards, and cashback offers that tempt many young adults.
But having too many credit cards can cause problems like:
· Difficulty managing monthly payments
· Risk of missed payments and late fees
· High annual fees that drain your wallet
· Lower credit score due to poor management
Understanding these risks is the first step to better credit card management.
Step 1: Make a List of All Your Credit Cards and Their Details
Start by listing every credit card you own, along with:
· Credit limits
· Annual fees
· Interest rates (APR)
· Rewards or cashback programs
· Payment due dates
This helps you identify which cards add value and which are just clutter.
Step 2: Choose Which Credit Cards to Keep Based on Benefits and Usage
To declutter your wallet, decide which cards to keep by considering:
· Annual fees: If a card’s fee outweighs its benefits, it’s time to close it.
· Rewards that fit your lifestyle: Keep cards with rewards relevant to your spending habits like travel points or cashback on groceries.
· Interest rates: For occasional balances, lower APR cards save money.
· Credit limits: High-limit cards can help lower your credit utilization ratio, improving your credit score.
Step 3: Close Unnecessary Credit Cards Carefully
Closing credit cards can affect your credit score, so do it thoughtfully:
· Keep your oldest credit card open to maintain a long credit history.
· Avoid closing multiple cards simultaneously.
· Pay off any outstanding balances before closing.
· Consider freezing or pausing cards if you’re unsure about closing them.
Step 4: Automate Credit Card Payments to Avoid Late Fees
Late payments damage your credit score and add fees. Set up automatic payments for at least the minimum due amount on all cards to stay on track. Alternatively, use calendar reminders or budgeting apps to alert you before payment due dates.
Step 5: Use Your Credit Cards Strategically to Maximise Rewards
To get the most out of your credit cards:
· Use your cashback card for everyday purchases like groceries.
· Use travel rewards cards for booking flights and hotels.
· Use low-interest cards for larger purchases you plan to pay off over time.
This approach helps you maximise credit card rewards without overspending.
Step 6: Regularly Check Your Credit Score and Credit Report
Monitoring your credit score and report helps spot errors or fraud early. You can get free credit reports annually from credit bureaus, and many apps offer free score tracking. Maintaining a healthy credit score opens doors to better loan rates and financial opportunities.