I have a few of comments:
1) The ideal number of credit cards is 2 if you pay them off each month. Reasons: (A) too many cards hurts your credit rating, (B) sticking to just one makes increasing your credit slow since you only prove that you pay 1 bill per month on time, (C) having two makes it easier if you happen to max one out in a time of need, (D) having two lets you keep one safe at home while you take the other out - thieves cannot do much harm by stealing all your credit cards - you will have one to spare while you wait for replacements to be mailed to you.
2) If you don't pay them off each month, the ideal number of cards is zero. You are paying way too much in interest so you are wasting your money.
3) Credit card companies make money in two ways: (A) they earn roughly 4% on each purchase. If you buy $100 of goods, the store then owes the CC company about $104. This 4% is how credit card companies can afford to give cash back, airline tickets, discounts, and other forms of benefits. This 4% also guarantees that the CC company makes money even from customers who pay their bills off completely each month. Remember the 4% gas discount for paying in cash that was so popular a few years ago? That was the gas stations passing the savings on to the customers (now they perfer to have as little cash as possible to stop theives so that discount is not common anymore). (B) CC companies earn interest on unpaid balances.
4) A CC company loses money in one major way: unpaid bills (bankruptcy, going into hiding, death, etc.) Thus CC companies love to get money each month that proves you haven't died, aren't hiding from your bills, aren't delcaring bankruptcy, etc.
5) If you only pay the minimum balance each month, then you can't charge much on the card. In this case the CC company loses out on the 4% profit per purchase.
6) Combining thoughts (3-5) you can quickly see the ideal customer: purchases lots each month (earns the 4% profit), and pays a lot of the balance each month but not all (earns the interest plus allows more 4% purchases). However I would never suggest that you pay less than the maximum since a little more credit isn't worth the hundreds of dollars you will waste paying the interest.
7) The number one credit increasing tactic: pay every bill on time for as long of a stretch as you can. Since you are 18, you haven't payed that many bills yet. Just sit back and wait. You should get steady increases over time. I tend to get an average of $9 credit increase every day per card (they come in large increases every 3 months) just from paying the complete bill on time every month. I'm 24 and got my two (and only two) $1000 cards at the age of 19. The math is easy: each now has roughly a $1000 + $9*5*365 = $17,000 limit.
.
Facebook
Twitter