Here Is Why Kevin O'Leary Says You Need Two Credit Cards
Curious about the “right” number of credit cards you should have as a cardholder? The answer, according to “Shark Tank” Investor Kevin O’Leary, is everyone should have two credit cards.
How does having two credit cards allow you to better maintain your credit card use? Read on to find out how O’Leary’s advice applies to good credit card practices.
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Why You Need Two Credit Cards
Cardholders with two credit cards will have specific uses for each card.
In a “Good Morning America” segment, O’Leary recommends keeping a low credit limit on the first card with $2,500 as the maximum amount. This card is the one cardholders will want to put online for use on monthly services, such as paying for streaming platforms.
“Because it’s maxed out at $2,500 and that number is out there on the Internet, you kind of care about that,” O’Leary said.
The second credit card is one you use personally for yourself. This card is recommended to have a credit limit of $10,000, but O’Leary does not recommend putting it online. Cardholders will use this credit card exclusively for larger purchases only.
Best Practices for Maintaining Two Credit Cards
Cardholders with two credit cards benefit by being able to build a credit history which can help them reach various financial milestones throughout their lives.
However, O’Leary said the key move to make when you have two credit cards is paying them off. The balances on both credit cards need to be paid in full every month.
“You never want to have a balance because you get charged interest between 7% and 23%,” O’Leary said. “That’s a lot of money.”
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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