If you're like most Americans, you're probably carrying as many as eight credit cards in your wallet right now— around seven more than you need. Sure, credit cards make shopping faster, safer, and easier, and it's hard to resist those extra-10-percent-off offers or super-low introductory rates. But when it comes to credit, you can have too much of a good thing.

Cardholders with revolving balances face steep interest charges and the potential for plunging deep into debt. Having several cards can be costly even if you're perfectly responsible. Banks are constantly devising ways to nickel and dime consumers with new fees— like imposing fees on conscientious customers who don't carry a balance. Too much available credit can also harm your credit rating, keeping you from getting a mortgage or other big loan.

HERE'S HOW: Every time you apply for credit from a store, bank, or credit union, that creditor contacts one of three U.S. credit bureaus (Equifax, Trans Union, or Experian) for information on your creditworthiness. An applicant with a lot of cards makes lenders nervous. Although you may use only one or two of your cards and have no intention of charging the others to their limits, creditors worry that there is always the potential. Besides taking into account your outstanding debts and repayment history, these bureaus also judge you by how much credit you've applied for recently. Having more than five credit inquiries in the previous six months hurts your chances. In other words, if you give in to every plastic-peddling department store employee by filling out an application for a new account, your credit rating could suffer.

Then there's the cost. If your payment is late by just one day, some lenders will immediately hit you with a late payment fee of up to $29. Add to that the annual fee for a card— the average fee is currently $18.40. Department store cards are even worse. Although they don't carry annual fees, store cards almost always charge astronomical interest, in the 18 to 24 percent range (versus a 15 percent average interest rate for bank credit cards).

ONE MORE CONSIDERATION: If you lose your wallet you're liable for only $50 of fraudulent charges on each card. With several cards, those fees add up quickly. Plus, calling all of your creditors to let them know you've lost the cards is a big hassle.
Convinced? Know this— cutting up your cards is not the same as closing your accounts. You must call each company to completely sever your ties. Deciding on which card to keep will require some more effort. The truth is, one size does not fit all when it comes to credit cards. So to pick the one card that fits you best— or two cards, if you're concerned that your first choice won't be accepted everywhere— take a long, hard look at your payment patterns.