To close or not to close

[Jungook]

Hello everyone

So it's nearly been two years since I started my credit journey and so far it has gone pretty well. Lately I've been thinking what step I should take next but honestly there's not too many things to be done. My current income/lifestyle does not warrant a travel card and I'm already happy with what I currently have.

That being said, I'm thinking about closing my Discover IT for Students card. IT (teehee) has served me well and I'm thankful that Discover gave me my first card and took that risk. I've since acquired the EveryDay, Freedom, and SallieMae and honestly I have no use for the Discover. Yes Discover is friendly and they have some really solid benefits but nothing really that my others cards can't do (SallieMae FICO, Freedom rotating categories, etc). 

I have heard that graduating the Student card to the regular card can be a bit of a pain and since I already have a relatively low limit ($1500), I'm thinking it would be best to just close it? Yes my potential utilization could go up but rarely do I carry a balance and my AMEX is nearing its next 3x CLI so I'm not too worried about that. I know there are those who are adamant in saying that there's no harm in SD'ing a no AF card but personally I like to carry as few cards as possibly (even if they're not in my wallet) and it's just less stress for me when organizing and planning my finances.

I would just like to see some other's opinions and thoughts before I did anything "unrational" or the like. Cheers. 

[Anonymous]

Is the Discover card your oldest account?  Although if closed, it will report for 10 years I suggest you keep it open.  Hearing about Discover being difficult in graduating it isn't enough.

Reach out to them and see what they can do for you.  It is a very good card and it is good to have diversification.  So keep it open.

[Anonymous]

Yes, I would highly recommend keeping it open if it is your oldest account.

I am in a similar siuation, this December will be my 2 years since starting my credit journeyl.

I loved my Bank of America Cash card but now; have literally no use for it anymore.

I keep it open as it is my oldest card, and it would be a very bad idea for me to close it now due to my limited history.

It would kill my AAoA. Just sock drawer it and buy a pack of gum or something once a year with it. It's not a big deal.

[Jungook]

It is indeed my oldest account.

So when would be the ideal time for me to close it? As YesItsMe mentioned, the card stays on file for another 10 years giving plenty of time for my other accounts to grow, no? The rest of my cards are only 1 year younger than my Discover card. Surely in 10 years time it wouldn't matter that much?

[Anonymous]

Just get ready for a potential drop in FICO scores, so applying for other CC's would be riskier.

YesItsMe, I am pretty sure was using that a as point against closing it, not as a reason why you should.

Your avverage age of accounts would probably go from like 1 year to 5-6 months depending on when you applied for all of your cards.

Yes, it would obviously improve, but it would take another year or two to get back to where you are now.

Why do you want to close it so bad anyway? It just seems like it's not even worth the drop in scores.

Just sock draw it or apply for a PC. You don't have to use every credit card you have.

[takeshi74]

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@Jungook wrote:

I would just like to see some other's opinions and thoughts before I did anything "unrational" or the like.

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Aside from this info http://ficoforums.myfico.com/t5/Credit-Cards/Closing-Credit-Cards/m-p/347190?jump=true which you already seem to understand the decision is up to you and your preferences, priorities, etc.  You'll get people recommending that you do what they'd do (such as the ever popular on myFICO "SD if no AF") but that may or may not be relevant to you.

Do the before-and-after utilization math to help you in your decision making.

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@Anonymous wrote:

Your avverage age of accounts would probably go from like 1 year to 5-6 months depending on when you applied for all of your cards.

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That is incorrect.  See the link I posted as well as the replies above.

[Anonymous]

but the OP already has all the cards they want. i say close it if you don't want it. simple. you have all you want so why have what you don't want. as long as your utilization stays the same your credit won't go down from it. and your credit history is already short so it's not a big deal.

[kdm31091]

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@Jungook wrote:

Hello everyone

So it's nearly been two years since I started my credit journey and so far it has gone pretty well. Lately I've been thinking what step I should take next but honestly there's not too many things to be done. My current income/lifestyle does not warrant a travel card and I'm already happy with what I currently have.

That being said, I'm thinking about closing my Discover IT for Students card. IT (teehee) has served me well and I'm thankful that Discover gave me my first card and took that risk. I've since acquired the EveryDay, Freedom, and SallieMae and honestly I have no use for the Discover. Yes Discover is friendly and they have some really solid benefits but nothing really that my others cards can't do (SallieMae FICO, Freedom rotating categories, etc). 

I have heard that graduating the Student card to the regular card can be a bit of a pain and since I already have a relatively low limit ($1500), I'm thinking it would be best to just close it? Yes my potential utilization could go up but rarely do I carry a balance and my AMEX is nearing its next 3x CLI so I'm not too worried about that. I know there are those who are adamant in saying that there's no harm in SD'ing a no AF card but personally I like to carry as few cards as possibly (even if they're not in my wallet) and it's just less stress for me when organizing and planning my finances.

I would just like to see some other's opinions and thoughts before I did anything "unrational" or the like. Cheers. 

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It's your oldest account I would keep it open.

While some have issues with Discover CLIs, in general, they seem pretty flexible about growing over time with people so your limit shouldn't be stuck that low forever. It's certainly easier than trying to grow a Chase card limit!

And just in my opinion, the Discover card is far better than Freedom. Discover's categories are more broad during the year (home improvement, online shopping vs Freedom's just lowe's or just amazon etc). and they have discover deals which again just in my opinion is a better portal than the UR shopping mall. It comes down to preference, but just on a cash back basis and not including the whole CSP thing, Discover beats Freedom hands down. So if you want to close anything, I'd close Freedom before Discover.  Even those who love Chase will tell you that your Discover card growing through CLIs is far, far more likely than your Freedom.

[Jungook]

Hm... Lots of great feedback, thanks guys.

I did the before and after AAoA and if I didn't open any new accounts I'd be losing like 3 months on my AAoA in ten years (11.25 years vs 11 years). Of course this scenario is unlikely as eventually I'd open a new account for something (car loan, mortage, etc).

Quick question, do student loans count towards AAoA?

In regards to the card, I think I'm just going to SD it. The efficient side of me says to just close it to have one less thing to worry about but the cautious side of me is telling me to keep it open just in case. As KDM pointed out, Discover does have better rotating categories but in all honesty I'm beginning to hate rotating categories in general! The SallieMae and AMEX have spoiled me! Again, thanks for the feedback everyone, think I'll keep it open.

[Anonymous]

if you're comfortable with the extra card then i would SD it. i have like 5 SD cards lol. and yes your student loan counts towards AAoA