Closing a credit card…WWYD?

[Sprinkles&Sprints]

Hi all - this isn’t necessarily DVC-specific but I know many owners on here are super knowledgeable when it comes to credit card/maximizing benefits so hoping I can tap into the collective brain trust. Obviously moderators feel free to move if not ok.

My dilemma - I have a British Airways Chase card with a $95 annual fee - getting it made sense a few years back but I never use it now so paying the $95 just bugs me…but is it worth closing if it’ll hit my credit? I’ve never closed a CC before so clueless as to what the impact will actually be…and maybe I’m worried for no reason.

I already confirmed with Chase that there’s not a no-fee alternative card in this category (so couldn’t ’downgrade’ to Disney Visa)….so WWYD? Just suck it up and continue paying the fee or transfer most of the remaining credit to another card and close (already moved a good chunk to my Chase Sapphire Reserve)?

Welcome any thoughts!

 

[DisTravels]

I already confirmed with Chase that there’s not a no-fee alternative card in this category (so couldn’t ’downgrade’ to Disney Visa)….so WWYD? J

Not sure what you mean alternative card in this category. There may not be a annual fee free version of a BA card, but did they also specially say you count transfer to any other product? Chase Freedom cards are usually Chase's catch-all - although then you would miss your enrollment bonus if you signed up for a Chase Freedom card net-new.

My dilemma - I have a British Airways Chase card with a $95 annual fee - getting it made sense a few years back but I never use it now so paying the $95 just bugs me…but is it worth closing if it’ll hit my credit? I’ve never closed a CC before so clueless as to what the impact will actually be…and maybe I’m worried for no reason.

Closing a credit card reduces your total line of credit available - the impact depends on may things including what your debt utilization is. If you have little/no debt then closing a credit card will have minimal impact.

 

[Where'sPiglet?]

I don't have an answer for you, but I'm in the same boat with my Delta Amex. The annual fee used to be $95 or $99, and I thought it had gone up to $120, but I just looked and it's up to $150. The fee used to cover the cost of checked baggage with the trips I was taking, but now it's so high that it doesn't.

 

[Sprinkles&Sprints]

Not sure what you mean alternative card in this category. There may not be a annual fee free version of a BA card, but did they also specially say you count transfer to any other product? Chase Freedom cards are usually Chase's catch-all - although then you would miss your enrollment bonus if you signed up for a Chase Freedom card net-new.


Closing a credit card reduces your total line of credit available - the impact depends on may things including what your debt utilization is. If you have little/no debt then closing a credit card will have minimal impact.

Yep - they specifically said I could not transfer to any other Chase card bc this is a partner card (at least that was the reason they provided).

But good to hear that closing a CC will have minimal impact if low/no debt - thankfully that is the category I would fall into!

 

[WDWEPCOT]

You take a hit of a few points and move on unless your buying a car or house it really won’t matter within a few months you’ll have made up those points so it’s not gonna really matter You’re gonna be saving money by not paying that fee and get yourself a better credit card that suits your needs ! And even if you were making a big purchase you can explain the dip in your numbers because you close the credit card
It’s a little thing in life don’t worry so much about it it’ll be OK!!!

 

[Travel60]

Paying off the balance in full is step one. Don't just move to another card.

 

[Sprinkles&Sprints]

Paying off the balance in full is step one. Don't just move to another card.

Thanks! There’s no balance - I would just be moving the credit limit.

 

[DisTravels]

But good to hear that closing a CC will have minimal impact if low/no debt - thankfully that is the category I would fall into!

Low/No debt has it's rewards @ times.

 

[gottalovepluto]

Close it. Never pay an AF on a card out of fear it will really hurt your credit score, if you're worried about credit history you should have a no AF credit card anyway that becomes a lifelong card to age your credit without impacting your cashflow. After closure the card will stay on your credit report for 10 years.

On the Budget Board you'll find a thread called I Love Credit Cards, so if you have further cc q's pop in there! While most of us are focused on chasing bonuses, we have a deep bench of general cc knowledge as well and I promise we're a friendly bunch Since you have that Chase Sapphire Reserve you really should consider popping in and consulting us on other cards to maximize your Ultimate Rewards (even something as basic as a no-AF Freedom or Freedom Unlimited complement the CSR as they earn URs at a better rate and then you combine all the URs to your CSR for redemptions). Link to thread skim page 1 and jump to the end and chime in if you want!

I don't have an answer for you, but I'm in the same boat with my Delta Amex. The annual fee used to be $95 or $99, and I thought it had gone up to $120, but I just looked and it's up to $150. The fee used to cover the cost of checked baggage with the trips I was taking, but now it's so high that it doesn't.

Hi! You should check us out on I Love Credit Cards thread too! I take it you have a DL Gold personal card? Are you aware of the $100 annual hotel credit when booked through their delta hotel portal? If you got the biz version it would be a $150 AF but you'd get $150 annual hotel credit so the net cost could be zero. (Lots of people qualify for biz cards but don't realize it, you can consult us on this too!) Link to thread skim page 1 and jump to the end and chime in if you want!

 

[AnnaKristoff2013]

My dilemma - I have a British Airways Chase card with a $95 annual fee - getting it made sense a few years back but I never use it now so paying the $95 just bugs me…but is it worth closing if it’ll hit my credit?

The hit to your credit will be very minor, especially if you have other cards (really all it will do is slightly lower your average age of credit and total available credit). It is definitely not worth paying $100 a year in perpetuity over.

 

[Sprinkles&Sprints]

Thanks everyone - this is exactly the sanity check I needed!

 

[VGCgroupie]

I used to think closing cards was a bad idea. I recently learned that it only has a big impact if it's your oldest credit card. I closed 3 cards and my score went up by 20 points

 

[ClaraOswald]

I had a United Visa for years back when I flew with them a lot. Then I stopped but paid the annual fee for way too long. Finally closed it a few years ago and never looked back. I do have a couple credit cards already (Disney and Amazon) so I wasn't worried about closing this one.

 

[Sprinkles&Sprints]

I used to think closing cards was a bad idea. I recently learned that it only has a big impact if it's your oldest credit card. I closed 3 cards and my score went up by 20 points

That’s good to know! I’ve only had this one for a few years but have had my Amex for 25 so hopefully that will help!!

 

[Brian Noble]

is it worth closing if it’ll hit my credit?

I believe the right thing to do in these situations is to make the decisions that make sense for my financial life, ignoring the credit score, and let the score follow. Otherwise, I'm letting the tail wag the dog.

This may make a small difference for a short time. Small differences in score do not matter that much in any practical way. And there are always small differences based on the details that get reported to the various agencies, so this tends to get lost in the dim history of time fairly shortly. But, because we can now see every change in our credit scores, we become obsessed with maximizing it.

In particular, the chances that any change in credit score ends up costing you more than $100/year seems vanishingly remote.

 

[Sprinkles&Sprints]

I believe the right thing to do in these situations is to make the decisions that make sense for my financial life, ignoring the credit score, and let the score follow. Otherwise, I'm letting the tail wag the dog.

This may make a small difference for a short time. Small differences in score do not matter that much in any practical way. And there are always small differences based on the details that get reported to the various agencies, so this tends to get lost in the dim history of time fairly shortly. But, because we can now see every change in our credit scores, we become obsessed with maximizing it.

In particular, the chances that any change in credit score ends up costing you more than $100/year seems vanishingly remote.

Agree! CC officially closed as of this AM. Thanks again everyone and shout out to @gottalovepluto for recommending I head over to the CC group - definitely a treasure trove of info over there!!

 

[Where'sPiglet?]

Close it. Never pay an AF on a card out of fear it will really hurt your credit score, if you're worried about credit history you should have a no AF credit card anyway that becomes a lifelong card to age your credit without impacting your cashflow. After closure the card will stay on your credit report for 10 years.

On the Budget Board you'll find a thread called I Love Credit Cards, so if you have further cc q's pop in there! While most of us are focused on chasing bonuses, we have a deep bench of general cc knowledge as well and I promise we're a friendly bunch Since you have that Chase Sapphire Reserve you really should consider popping in and consulting us on other cards to maximize your Ultimate Rewards (even something as basic as a no-AF Freedom or Freedom Unlimited complement the CSR as they earn URs at a better rate and then you combine all the URs to your CSR for redemptions). Link to thread skim page 1 and jump to the end and chime in if you want!


Hi! You should check us out on I Love Credit Cards thread too! I take it you have a DL Gold personal card? Are you aware of the $100 annual hotel credit when booked through their delta hotel portal? If you got the biz version it would be a $150 AF but you'd get $150 annual hotel credit so the net cost could be zero. (Lots of people qualify for biz cards but don't realize it, you can consult us on this too!) Link to thread skim page 1 and jump to the end and chime in if you want!

Thanks!

I do have a Delta Gold personal card. I saw the $100 hotel credit thing when I was looking around yesterday, but I don't remember the last time I booked an actual hotel room that I paid for. I'm usually traveling to visit family, and staying with them, or traveling to Disney and staying on DVC points.

I'll have to go check out that thread - I think I've read it before, actually! I don't necessarily need to replace this credit card, although it does have a nice credit limit on it. Like OP, I am not carrying a balance on this card.