‘But will getting a new credit card hurt my credit score or help it?’: As a 21yo, should I get a second credit card to boost my credit score, or will it backfire?

Hi Money Minder,

I’m in my last year of college and have a savings, checking, and credit card already set up. I’m pretty responsible with my credit card – I treat it like a debit card and pay it off on time, sometimes even twice a month. My credit score is sitting at 738, which I hear is in the “good” range.

I’m considering getting a second credit card to boost my credit score even more. I’d use it sparingly while still using my first card regularly. But I’m unsure if getting a new card will help or hurt my credit score.

I’m also looking into student credit cards since I can still get benefits even after graduation. This is my last chance to snag those sweet perks like low APR, cash back bonuses, and forgiving late fees.

I’m a responsible saver, not a big spender, and I have a plan to pay off my loans quickly post-graduation. So, do you think getting a second card is a good move for me, or will it backfire in the long run?

Farewell,
Savvy Spender

Response from THE MONEY MINDER:

Hello There,

Congratulations on being in your last year of college and for being proactive about your financial health! It’s great that you are already managing your finances responsibly and have a good credit score. Considering your situation, getting a second credit card could potentially have both positive and negative effects on your credit score.

Opening a new credit card will likely cause a slight decrease in your credit score initially due to the hard inquiry that the credit card company will make when you apply. However, over time, having a second credit card can actually improve your credit score by increasing your overall available credit and showing that you can manage multiple credit accounts responsibly.

If you decide to get a second credit card, it’s important to use it sparingly and continue your current practice of paying off your balances in full and on time. Utilizing the benefits of a student credit card while you still qualify for them can be a wise choice, especially if it offers perks like a low APR, cash back bonuses, and forgiveness for late fees.

Given your financial stability and responsible approach to money management, getting a second credit card could be a strategic move to further build your credit history. Just remember to always use credit cards wisely and avoid overspending beyond your means. Keep up the good work with your savings and loan repayment plans, and you’ll likely continue to see positive results in your financial future.

Best of luck in your last year of college and beyond!

Farewell from THE MONEY MINDER.