How Credit Cards Affect Your Credit Score

Disney Chase

You can earn tons of value from credit card sign up bonuses. It’s one of the easiest ways to save for your Disney vacation. But, you might be a little nervous about applying for a credit card. You want to know how credit cards affect your credit score. Here are answers to some of the most common questions:

Will applying for a credit card hurt my credit score?

No. Everyone has inquiries on their credit report; that’s normal. However, having a lot of inquiries in a short period of time can be a red flag. Here’s a quote from Experian on the matter: “Sometimes opening several credit accounts in a short period of time represents a greater risk to lenders—especially if there isn’t also an established credit history on record. This can be a sign of trying to overspend.”

Does having multiple credit cards hurt my credit score?

Actually, they can improve your credit score. A portion of your score is based on the percentage of available credit that you’re using. So, if you have one credit card with a $5,000 limit and you’re using $4,000 of it every month, this signals a risk to the creditor. But, if you have three credit cards with $5,000 limits ($15,000 total) and you’re only use $4,000 of your available credit, you look like a lower risk.

What if I can’t pay off my card each month?

What you can earn in credit card rewards does not compare to what you’ll pay in interest if you don’t pay off your card each month. You can earn as much as 10% in credit card rewards on your purchases. However, the amount of interest you’re likely to pay if you carry a balance on your credit card is more. Bottom line, credit card rewards are quite valuable, but only if you’re paying off your credit card each month.

How long should I keep a credit card before cancelling it?

Credit agencies view open credit lines with long histories positively because it shows continuity and dependability. So, if you have a credit card that you’ve had for a long time with no annual fee, keep it. If you have a credit card that has exceeded its usefulness and has an annual fee, cancel it.

How do I check my credit report?

The federal government gives you access to a free report every 12 months from each of the three major credit bureaus: Experian, Equifax, and TransUnion. The official site for requesting these is You can get a free report from all three at once to compare them or get one at a time and spread them out over the course of a year.

Our Results

We each apply for a new credit card every six months. This means between the two of us we’re getting one in our household every three months. We keep some indefinitely and cancel others. Over the last year our two credit scores have fluctuated between 766-787 and 797-810.

The two most important things for maintaining our high credit scores is never missing a payment and always paying our credit cards off.

Best Sign Up Bonuses for Disney Vacations

Our favorite sign up bonus for Disney vacations is the Chase Sapphire Preferred. The annual fee is waived for the first year and the sign up bonus is worth $1,000. You can learn more about the card and how to use the sign up bonus for a Disney vacation HERE.