Closing older cards.

[thedaveytrain]

I have several older cards that I have xfered balances from to leave zero balances. What I want to know is should I close those cards down? A few of them have yearly fees that the companies have refused to waive, and one (Target Visa) has already been closed due to inactivity. It was from 1996 and was my oldest card, my oldest one now is 1999 I think. Do I just need to keep that one open and close the newer ones safely, or should I keep them all open with zero balances?

[pattycake]

Keep as many open as you can, use them every couple of months to show activity and pay them off. The old accounts will continue to report good payment history for 10 years, but as a rule, you want the age.

Welcome to FICO land!!!

[thedaveytrain]

even those that charge a yearly fee? Is that really worth it?

[MarineVietVet]

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@thedaveytrain wrote:
even those that charge a yearly fee? Is that really worth it?

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Welcome.

Only you can decide that. My oldest card (12 years) has an annual fee of $20. They usually waive the fee but didn't last year. I'm not going to close my oldest account over $20. It can be a tough decision depending on the age of the account.

(myfico)
7/09 TU-742 EQ- 779
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"Hello my name is Sandy and I'm a recovering crediholic".

[haulingthescoreup]

The only time that I would keep a fee card that I wasn't using would be if it were my oldest account by several years. If there were another one six months or so younger, that I keep using, I'd be willing to let the fee card go.

Closed cards do keep counting for your history as long as they're on your reports (generally 10 years.) You might want to read fused's "Closing Credit Cards" for more info (linked in my siggy below.)

[thedaveytrain]

I read the thing about closing cards before, and I get that...but do I need to keep all the older ones open? Or just the oldest one? How is it calculated? I'm fine with keeping one extra one just for that, but I'd like to get rid of the in between ones that don't offer any kind of rewards or anything. What kind of hit are we talking? If it's just a few points I can deal.

[Jazzzy]

You will keep the age of your oldest account, so, if you are not using the newer cards, and they have fees, it's not a bad idea to close them. There is no need to keep cards open that have annual fees if you don't need the credit line.

I've closed out everything with fees except one. It's an airline card, and the rewards are worth the fee. If you are not profiting from the rewards and don't need the credit, don't feel you can't close them.

[smallfry]

If you close nearly all the old cards it will hurt your AAofA given enough time. Don't pay a lot in fees though.

[haulingthescoreup]

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smallfry wrote:
If you close nearly all the old cards it will hurt your AAofA given enough time. Don't pay a lot in fees though.

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+1

Lots of people don't consider this --if you keep the very oldest, and close the next 5 (or whatever) oldest, your AAoA will drop when they fall off. You'll keep the longest history, though, as long as that oldest account is there.

Do consider the fact that sometimes an entire line of credit cards gets closed --store goes out of business, etc. --and that oldest card can get closed whether you want it to or not. If that happens, and you have closed the next 5 oldest, your longest history will really take a beating eventually. But that eventually will be up to 10 years after closing, so it's not worth losing sleep over now. Just be aware that some startling things can happen to your credit profile in a decade if you get a little free with the machete now.