Should I close my credit card accounts when I pay off the balance?

[JDUCKY]

No! Do not close your accounts. On your credit reports all it shows is that they were closed, not that you are the one who did it. If you don't want your cards anymore, just cut them up. But keep your accounts "active." Or, a better thing that is good to do, if you can, is only use your cards once every 6 months for something small. It keeps you on the the credit radar, so to speak, your accounts come up as active, but if you're only spending $20 every 6 months, you can't get into too much trouble. By doing this, you are showing the credit companies that there is the potential to make money off of you, so if you need credit in the future (for a house, car, rent an apatment, etc.) you will have a positive credit history.

That's not true. Credit reports show why the account was closed (Transferred/sold - such as refinancing a car, Closed by Guarantor, Closed at Consumer Request, etc.)

Absolutely close them. I know popular opinion is not to in case of emergency but that is what a savings account is for. We went through a debt free class last year and by September we paid off over $17,000 in debt and closed our cards. We had some friends who paid off all their debt and kept the cards. Guess what? They have Credit Card debit again because we don't know how to qualify an emergency.

Sure...if one isn't worried about maximizing their credit score.

Just exhibit some modicum of fiscal responsibility and only use them when needed. Plenty of people have $50,000 or more in credit limits available to them and keep the utilization at or near 0%.

Personally, I'd go for ones that offer rewards points or discounts on purchases and pay the balance before the next statement date. Short-term, interest-free loan!

 

[brivers222]

do not close any cards once you pay them off... just don't use them or use them just enough that you can keep them active...


By closing them you reduce the amount of credit utilization which sadly hurts you...

Cut your credit-card debt, but not your cards. Minimizing credit-card debt is a great goal, but closing old accounts could hurt your credit score. About one-third of your FICO score (the credit score most lenders use) is based on your credit-utilization ratio, which is the total of your credit-card balances divided by the total of your credit-card limits. What counts is how much you've charged, regardless of whether you pay your balance in full each month. A good target is to use 20% — or even less — of your available credit. If your card company has raised your interest rate or imposed an annual fee, you might want to close the account and take a temporary hit to your score. But don't do it within three to six months of applying for a loan.