Fashion

[millieshops]

MY bank closed a credit card I was no longer using - hadn't used it for several years, wasn't going to use it.

That card had a large limit on it, and my credit score went down ONE POINT right at the time the cancellation took effect. That does not matter one tiny bit - I'm in the "top-middle " of my credit ranking - I'll never be top they tell me because I have had no car loans or mortgages for many, many years. That's their recommendation? Not happening. I like being debt free.

[Havarti]

Here is what I understand…

The reason they say you should not close your credit cards is because:

· The higher the amount of credit available to you shows that companies trust you based on your financial worth and payment history

· The amount of the credit available to you that you actually use should be low, indicating to creditors that you have the ability to buy more but know how to control your spending

· The payment history – that you pay what is expected (or more) on time… every time

All of these factors add up to a higher FICO score.

We keep them all open, use one mainly and pay it in full every month. Periodically, it is important to pay something off with payments (even if you do not need to do so), so your credit history reflects that you are reliable in keeping up with payments (it needs to be something more than a mortgage). We had to buy a new refrigerator and while we could have paid in full, we used that as a payment item. The small amount of interest it cost was worth having that positive history on the credit record, just in case you really need to obtain other credit in the future.

[Trudey]

Thanks for all of your responses. I have two cards that have a balance. I'll pay those off as soon as possible then just cut up the cards I don't use. I have two cards that charge a yearly fee. I do plan to close one of those or ask them to waive the fee. I would love to just close all of them except for one, but based on your responses, I won't do that. Thanks again and Happy New Year.

[Pook]

Many banks will automatically close them out after a period of nonuse.

[LTT1]

I would not suggest canceling all of one's credit cards except one. Perhaps four times we have had the cc company call us and tell us they were closing the account due to criminal activity that included our account. While we waited for the card with the new account to arrive, we used the back-up bank card. I do not feel comfortable with only one card.

I keep the LL Bean active because with it one receives free shipping both to and from. We do pay ours off each month...

[MomCat]

On 1/2/2015 millieshops said:

MY bank closed a credit card I was no longer using - hadn't used it for several years, wasn't going to use it.

That card had a large limit on it, and my credit score went down ONE POINT right at the time the cancellation took effect. That does not matter one tiny bit - I'm in the "top-middle " of my credit ranking - I'll never be top they tell me because I have had no car loans or mortgages for many, many years. That's their recommendation? Not happening. I like being debt free.

I agree. It really doesn't matter. I've mostly kept one credit card in use for many years. Let the others go or cancelled them. The one thing people don't explain is, why does it matter that your credit score goes down a point? If it's easily explainable, big deal. I've not had any outstanding loans for years, but I guarantee you if I wanted one, I could easily get it.

[LTT1]

The reason we have TWO bankcards is that "what if?" For instance, if one is in transit, and "what if" we get in a bad car wreck... we might need one with a substantial limit. WHAT IF... we were out of town, etc. I live in a WHAT IF state of mind. Car rental requires a cc... and so do hotels... we managed very carefully on the 0% cc's when DD went to college. We were VERY vigilant about using them and paying off way in advance of the deadline. We don't have to do that any more, thank heavens.

[Chrystaltree2]

Yes, we did cancel several credit cards a few years ago. We we weren't using them, we didn't need them, we paid them off after we sold our former home and canceled them. I know that so called credit experts "say" you shouldn't do that but it makes no sense whatsoever to me. How can reducing one's debt be a bad thing? Plus, we are in our mid fifties. We paid cash for our condo and we have all the credit cards we will ever need. I suppose, if we were in our thiries and trying build up our credit rating, we might have looked at things differently. We each maintain our own credit cards. I have two major cards but I only use them for major purchases, I use my two debit cards for everything else because I basically, I live on cash.

[LTT1]

We use ours like a debit card... don't know why... we just got in the habit. A checking account is not as simple... using a cc (or debit card) is more convenient. We are one of those customers that the cc don't like b/c we pay it off...

[kitty60]

I think if you have good credit it really doesn't matter. We have excellent credit, use credit cards and pay everything in full each and every month. I have weeded out those store cards I do not use and cancelled with no ill effect. We have a few we use on a regular basis as I do not like to carry cash and lose track of what I've spent. I keep a tally of what we spend and match all the slips when I get the statement. Also, I do not like using a debit card because I do not want my account wiped out, (this happened to my son over labor day because of the Home Depot problem.) You do get it back but it is a hassle. I only use my debit card at Aldi's as they do not take credit cards. I went to my bank and had my daily limit on debit card reduced to $100. I know I will never spend more than that there and if I got hit for $100 I could survive until the matter was corrected.