A few days ago, I was in San Fransisco with a friend, eating burgers at a Korean/Japaneses/Asian fusion (whatever that is) restaurant called Namu (Nothing beats burgers at an asian restaurant. heh. Yelp reviews can be found here).

Being the awesome friend that he is, my friend paid for the lunch with his semi-recently acquired Citi mTVU student credit card. This credit card was his first credit card and it was none other than yours truly that recommended the card to him.

“Ah, so you’re using the card now eh?” I said to the friend calculating the tip amount. “Do you like the card?”

“It’s great! I’ve racked up quite a bit of points already.” my friend told me as he writes down a 15% tip.

The funny thing about all of this, is that my friend is at least a year or so older than me. He is almost out of graduate school, and will soon be making a nice six figure salary. Besides his student loan, which is also of a sickening six figure amount, my friend has never been in debt.

It was only about a half a year ago, when I had lunch with him that he pulled out his debit card to pay for his lunch.

“Why don’t you use your credit card?” I asked him.

“Oh. Um, I don’t have one.” he told me nonchalantly.

My jaw would have dropped, but this was not the first time I came across a situation like this. Despite the media report, there is still quite a good amount of college/graduate students without a credit card — and from my experiences, that’s probably a good thing.

I have already mentioned that I love credit cards (even though it is the very thing that got me into the debt mess), but that doesn’t mean I despise people that use debit cards. Like my friend here, I have many other friends that didn’t get a credit card until a certain annoying friend told them to. All of these friends that don’t have a credit card have an interesting difference to my other friends with credit cards.

What’s this difference?

You’ve probably already guessed it: None of them have high-interest consumer debt.

And so, I went ahead and recommended to these friends that don’t have a credit card to get a credit card. heh.

No no, not because I want them to get into debt — I’m not that petty, dammit. I recommended a credit card to them because I know fully well that they already have the capability to manage their cash wisely, and so I trust that they will also manage their credit wisely.

They have already been paying their purchases in full for years, so switching to a different paying method should not affect their spending habits.

Anyway, that’s not the point of this post.

As we walked out of the Asian fusion restaurant (heh) and continue to chat about the benefits of using a credit card wisely, my friend asked me this question:

Why do people need more than one credit card?

This was a really refreshing question. I was stumped a bit on the question, not because I couldn’t immediately think of a reason on why people use different cards (mileage, gas, rebates, cash back, etc.), but more so because of whom the question is from.

Here was a guy who has never had a credit card until recently. He’s enjoying the free rewards from the purchases as he diligently pays off his bill every month. He is content with the credit card that he has, and to him, having one credit card is more than plenty. He does not look forward to dealing with more than one bill, nor does he care to juggle various reward cards to get the maximum reward/cash-back.

It is interesting that for awhile, I thought it was normal and perfectly acceptable for people to have many different types of credit cards — all the while, my friend can’t even fathom the reason why people need more than one card.

“Hmm. To be honest, most people probably don’t need more than one credit card.” I finally answered my friend. “There’s plenty of good reasons to have more than one credit card, since you can utilize different card for different transactions. But yeah… at the end, having more than one credit card, or even more than a few, is probably unnecessary.”

I proceeded to tell him the usual story about the average household credit card debt, and how people get one card to transfer the debt from one to another. And then I told him about how people unknowingly get high interest card, neglect to pay in full and became undisciplined in their spending with credit cards.

“So as you can see, credit card can really be a world of trouble for many people.” I told my friend. “The only reason why I recommended them to you is because I know you won’t abuse them.”

And I’ll continue to stick with these guidelines when I recommend credit cards.

If you already have more than one credit card, ask yourself this question:

  • Why do I need more than one credit card?

Depending on your answer, you may be able to see where you stand financially.
If you are considering getting a credit card, ask yourself these questions:

  • Why do I need a credit card?
  • What would I use for it for?
  • Will I pay my balances in full?

Educate yourself with the resources available. Learn to utilize cash wisely before you try credit. If you have trouble managing your cash flow, you will most likely have trouble with a credit card. Don’t know which card to choose? Ask around!

Although I love credit cards, you can probably get by these days without ever touching one.  Don’t get suck into the idea that you need a credit card.  Don’t get more than one credit card because you think you should.  Lastly, whatever you do, don’t get a credit card just because the cashier asked you if you wanted one.