Question about credit cards and credit score

[sdjen]

wondering if someone might know the answer to this.

I have a couple of credit cards with about a $10k limit. They are hotel/airline cards that I used a lot previously for my job which required a lot of travel. I was able to get several free nights and flights so they were worth it then. But, I no longer travel for work so I'm wondering if I should just cancel them.

I don't have a balance on them and don't plan on using them much (if ever). Will canceling them be a big hit to my credit score? One I have had for over 10 years. I have a really good credit score and want to keep it that way!
Thanks!

 

[CalDisneyMomof2]

I wouldn't touch them. It will decrease your credit limit and decrease your age of credit history. I'd just keep them and not use them. Do they have any other reward benefits?

 

[jls886]

The average age of your credit cards is big for your credit score, as is your debt ratio. Your cards are helping with both of those, so I would keep them. I use the CreditKarma app and love it, and it has also helped me see and understand what things really do affect my credit score. I used to think it was kind of scammy with their commercials, but after looking into it it's very legitimate.

 

[supersnoop]

A person with $100k available credit and $30k (30%) in debt will be rated higher than someone with $4k available and $2k in debt (50%). Credit scores don't take income into account.

You want to never cancel your oldest card. The length of your credit history is another positive factor. I still have the first card I ever opened in college.

 

[scrapquitler]

Clark Howard always tells people to keep the oldest cards, and if you don't use them often, just keep them and use them to buy gas or groceries once every few months, then pay the bill in full as soon as it arrives.

Like the PP, I still have the two cards I opened as a college student back in the late 80s.

 

[Albort]

Cancel the credit cards if there are annual fees. else, i keep them open. Use them once in awhile for the Credit utilization...

 

[sdjen]

Thanks everyone. They do both have annual fees of about $75. That was worth it to me when I would get free nights and 4x points on stays but since I don't travel for work now, I'm not sure that is worth it. I just cashed in my last points on one for 2 free nights in Orlando before our February cruise so now that one doesn't have any value that I can see. I have a large amount of available credit and don't carry any balances. I would still have several cards open if I cancelled these.

I would be okay if it was a small hit to my score as I could increase it over time again as I'm not planning on getting a car or new mortgage for a few years anyways.

Thanks for the advice!

 

[Sadie22]

If you had the free nights last February, it would be fine to cancel the card. If the free nights are for next February, you will most likely need to keep that account active for the points to be valid. If for some reason you were unable to keep those reservations, you would want to be able to have the points returned to your account, and you would probably need to be an active account holder for that as well.

 

[supersnoop]

Thanks everyone. They do both have annual fees of about $75. That was worth it to me when I would get free nights and 4x points on stays but since I don't travel for work now, I'm not sure that is worth it. I just cashed in my last points on one for 2 free nights in Orlando before our February cruise so now that one doesn't have any value that I can see. I have a large amount of available credit and don't carry any balances. I would still have several cards open if I cancelled these.

I would be okay if it was a small hit to my score as I could increase it over time again as I'm not planning on getting a car or new mortgage for a few years anyways.

Thanks for the advice!

I'd call them to see if they can convert the oldest card to a no-fee product, and cancel the other one.

 

[tvguy]

Closing one of my 2 credit cards did not lower my credit score. But it WAS the newer of the 2, and I had never ever charged anything on it, so that may be why. I did this 11 or 12 years ago when my son was about to start college, I did not want $20,000 of unused credit card credit on my record when I was applying for parent loans.

Funny now, those loans are paid off, I can't imagine ever needing credit again in my lifetime.

 

[Planogirl]

Be sure and occasionally use all of your credit cards. People are often surprised when they find accounts closed due to inactivity.

 

[dfchelbay]

Keep them open, use them on occasion & always pay off the balance. Oldest cards make your credit history look good. My father opened a credit card for me (with him on the account) before I was able to even drive, about 13 years old. When I wanted to buy something, we used the card & paid the balance off when the bill came. He taught me early on how important it is to maintain excellent credit. It's hilarious to think that my credit is almost as old as I am...lol

 

[LJSquishy]

I canceled my oldest card when we switched to a Discover It card and it didn't lower my score. It was about 10 years old. There is absolutely no way I'd keep any credit card with an annual fee if I weren't actively using it, even if I would take a hit to my credit score. Unless you plan to apply for a major loan soon (mortgage, car, etc) you shouldn't be that concerned about canceled cards lowering your score.

 

[LJSquishy]

I closed my oldest card when we switched to a Discover It card and it didn't lower my score. It was about 12 years old. There is absolutely no way I'd keep any credit card with an annual fee if I weren't actively using it, even if I would take a hit to my credit score. Unless you plan to apply for a major loan soon (mortgage, car, etc) you shouldn't be that concerned about cards lowering your score. My credit score is 810. In my opinion, it's not wise to have a ton of unused credit lines open.

 

[roadtripper]

The other option is to call to cancel and see if they will waive the annual fee. That has worked for me in the past.

 

[AmyAnne]

If you are not planning to apply for a loan in the near future, I wouldn't worry about it. Also, regarding the oldest credit card, is there not some point at which it's pretty much equal? Is a 20-year-old credit card really better than a 10-year-old credit card?

 

[AmyAnne]

Sorry duplicate post.

 

[savannie]

Ideally, you would keep them open, ask for the fees to be waived for being such a long-standing customer, and use them occasionally so they stay open. You definitely shouldn't keep them open and not use them, though. Credit card companies will often close accounts after long periods of inactivity, and it looks much worse if they close the card than if you close it yourself. It will say "account closed by credit grantor" or something similar. You want it to say that it was closed by you, if it's closed at all.