Related Posts
Go big or go home. Mega funds only.
How often do you rebalance your portfolio?
Thoughts on Airbnb stock?
Conversation Starter
Enthusiast
More Posts
Bowl Leader
Additional Posts in All things points
can i transfer my delta miles to spg points?
Anyone have the 100k Amex Plat offer??
Don’t cancel them - just downgrade them to the lower level card that doesn’t have a fee.
Yes, but for side reasons:
1) if it’s an above average history length card, your credit history will shorten
2) if it’s a card with a high limit, or even decent one, your use on other cards will spike your utilization % (% of all credit used)
Like D1, I recommend downgrading them to no-fee cards and trying to keep them barely active and on autopay.
For example, chase sapphire reserve has a no-fee chase sapphire free card they only allow as a downgrade card and do not advertise.
My husband had 13 credit cards and over $30,000 in debt. We paid it off. Then we closed 9 of them and 2 more closed because of no activity for years. We opened a travel credit card with Chase. If you know you're not going to be getting a house or car that needs a credit pull for at least a year, then I'd say you can close whatever you don't need. We made sure we were debt free before closing the cards. His score was in the 600s with 13 cards and now 800s with only 3 credit cards opened and used mainly for benefits. Only debt we have is whatever we use on the credit cards which is paid off straight away to prevent interest. Our cars are all paid off. Very manageable now! Yes it will impact your credit score, but not that much really and if you pay off your credit cards, it will increase again. Nowadays the scores take effect immediately instead of waiting one month.
Yes points will be deducted when you cancel them. Rule of thumb is to open/close no more than 1 every 2 years. You could just cancel all the ones you don’t want, and deal with the drop temporarily. Alternatively, you could ask one credit card to increase your credit limit, then cancel the other cards so that you still have the same amount of credit. It’s def not worth paying fees for cards just because you don’t want the couple of points off for a year or so. As long as you can keep the same amount of credit, your credit rates will likely stay about the same.
One thing you can do is ask the bank to consolidate your credit to another credit card before cancelling your card.
This help you maintain your overall credit limit.
I did this for two chase cards before cancelling one of them.
They all have $0 balances. Thanks for the downgrade idea. Will I lose the points I have if I downgrade? Thanks!
You might not lose the points, but there may be a different catch. For example, if you have the chase sapphire reserve, you can redeem points for 1.5 cent per point. If you downgrade to a no fee card I think you only redeem at 1 cent per point.
So long as you don’t close your first credit card (or unless you are fine accepting it would ding your credit score due to credit history being shortened) you should be fine. Just ensure your current credit use vs limit still sits at about 25% or total credit
Yes
It lowers your available credit and makes your debt to available credit ratio go up
Both of these will negatively affect your FICO score
Try to replace any one of them with fees with another card from the same place.
Keep card accounts open for at least a year and close them only before the following due date occurs. I have around 10 active cards at anytime. Half of those are keepers. The other half I cancel and replace with whatever offers are best at the time that I qualify for. If you have significant history with a bank, yes, try to at least keep one of those accounts open or downgrade. And make sure you don’t lose your points when you close any of your accounts.
I’m relocating abroad for the next ~2 years. So I think now is the best time to close out unused cards because my credit history won’t be needed in the immediate future. Plmk if I’m thinking about it wrong