topic Re: What card should I set a goal for? in General Credit Topics

What card should I set a goal for?

Ezk37 — Sat, 07 Aug 2021 17:04:42 GMT

I have listed here the cards/limits I have currently. Any advice on what card I should set a goal for next? Or maybe I already have too many? What do you guys think? Should I just go for CLI's on the ones I already have and not try for more cards? I know there are many other factors involved like CS and 5/24 and such but I'm just wondering what cards I might look forward to in the future?

Credit One Amex - $800
Credit One Platinum - $700
Capital One Walmart - $550

Capital One Secured - $501
Capital One Quicksilver One - $500
Synchrony B&H - $3000
Discover Cash Back -$9000
Target Red Card - $600
Fingerhut - $1000
Comenity Victoria Secret - $600
Daniels Jewelers - $568

5 total auto loans - 3 paid off.

1 baddie 60-90 late from 2015

1 $220 derogatory utility account

I've been floating around the forums here for months. Recently checking daily. Any advice would be greatly appreciated. Thanks!

Re: What card should I set a goal for?

SoCalGardener — Sat, 07 Aug 2021 21:59:10 GMT

@Ezk37 wrote:
I have listed here the cards/limits I have currently. Any advice on what card I should set a goal for next?

First, welcome aboard!

Next, there are so many variables, it's hard to give you a meaningful response without knowing a little more about you and what you're interested in achieving as far as credit goes. *MY* favorite card won't necessarily be YOUR favorite card, or even a good fit.

One thing I would focus on is quality over quantity. For me, I'd rather have a small handful of really nice cards than 100 crappy ones!

Have you thought about what type of card you'd like to get, i.e., cash back or miles or points or....whatever? Are you more interested in getting cards with great SUBs (sign-up bonuses) but not necessarily low APRs, or cards with low APRs but perhaps not great perks, or what?

If I were you, I'd definitely get rid of a few of your current cards, i.e., the 'starter' cards, like Fingerhut and secured cards. Work on increasing your credit limits on cards you want to keep long-term. As your credit improves and you can get approved for better cards and higher limits, either close the bad ones or sock drawer them. (I'd close them--they have such low limits I wouldn't worry about the negative impact on my credit score from closing them.)

Let us know what your objectives are, what you'd like in terms of what a card offers, and I'm sure you'll get a plethora of suggestions!

Re: What card should I set a goal for?

Ezk37 — Sat, 07 Aug 2021 20:15:01 GMT

I guess I'm mostly just concerned with increasing my credit scores. I completely agree about having a small handful of decent cards rather than 100 low limit high APR no perk cards. I'm going to be in this for the long haul when it comes to driving my score up, so at this point I guess that's my only real concern. If I'm being honest I had never really considered what I want in a card because I had never had a choice. I started with the Daniels jewelers account 15 years ago and completely ruined my credit with collections and tons of lates. (They have all since been removed or fallen off except 1 late from 2015 and a $220 collection for a utility bill.) I got my first $3000 card (the synchrony) about 7 months ago and was approved for the $9000 Discover last night. I won't have any true need for any of the smaller accounts/cards after receiving the Discover and honestly it wouldn't make sense for me to use ANY of the other cards or accounts at this point. I was just afraid to close the older accounts because it will seriously drop my AAoA. Total credit limit shouldn't be effected as much because the Discover $9000 now makes up over half of my overall limit. I'm aware that I need to have a decent mix of installment/charge/department store accounts as well? So I would need to calculate any closures carefully. Would you suggest taking the hit on the older accounts even if I'm sure I could sock drawer them for eternity? Will having them open spook better lenders? In answer to the question of what type of card I would enjoy.. I do like the cash back type. I couldn't care less about flight miles or hotel points really as I don't travel. Lower APRs are nice as well. Although my main concern is rasing my credit score. Thanks for the response!

Re: What card should I set a goal for?

OmarGB9 — Sat, 07 Aug 2021 20:37:58 GMT

Well score isn't driven by number of cards, or even total credit limits. It's driven by payment history (35%), amounts owed (30%), length of credit history (15%), New credit (10%), and credit mix (10%).

Also, closing accounts won't hurt your AAoA. If they're in good standing, they'll remain on your reports after closure for up to 10 years. So, nothing to worry about there.

My advice would be to close cards you don't need/see yourself really using anymore, but maybe not all at once. Maybe 1 or 2 every few months.

Re: What card should I set a goal for?

Yasselife — Sat, 07 Aug 2021 21:42:43 GMT

@Ezk37 I would get the Citi Double Cash for everyday spending, then I'd focus on specific perks(gas-transit, groceries, dining...); each card has its on strengths and weaknesses.
I recommend you apply in no less than 6mo(better odds of approval, higher limit and lower apr), until you have a thick profile.

I'm considering closing my starter cards too.

Re: What card should I set a goal for?

SoCalGardener — Sat, 07 Aug 2021 22:14:27 GMT

@Ezk37 wrote:
I'm aware that I need to have a decent mix of installment/charge/department store accounts as well? So I would need to calculate any closures carefully. Would you suggest taking the hit on the older accounts even if I'm sure I could sock drawer them for eternity?

On your first point--and you'll probably get disagreements on this--I've found that it doesn't really matter what kind of 'mix' you have. Speaking strictly for myself, I haven't had a loan of any kind (car, mortgage, anything) in YEARS (they fell off my reports a long time ago), and that hasn't affected my score at all; it's generally in the high 820s. I do have a mix of major credit cards and a few store cards, but no loans of any kind.

On your second point, a few things to consider if you're going to use the sock-drawer plan: does the card have an AF (annual fee)? If so, get rid of it. Verify with each creditor how long their period of inactivity is, and make sure you use each card during the appropriate time frame. For example, if a card automatically closes after one year of inactivity, make sure you use it at least once during each year. I actually remind myself when a card is approaching an inactive state, so I won't accidentally let it close! There are all sorts of other methods to keep a card active, such as charging an annual subscription (Amazon Prime, for example) or even a small, recurring monthly charge. I go with the "remind myself" method and that works out fine.

All things considered, I wouldn't worry about adverse effects on your credit age by closing any/all of the cards you don't want. It will cause a minor, temporary dip, but shouldn't be a big deal. I played around with a simulator recently, plugging in closing my oldest card (a 30-year-old Discover More card), and it dropped my score by 1 point!

Re: What card should I set a goal for?

Ezk37 — Sun, 08 Aug 2021 00:43:30 GMT

Thank you guys all for the info! The help is appreciated. What is the main purpose of closing unused accounts? Will it increase my chances of higher limit/better cards going forward? Or is it just because they aren't needed?

Re: What card should I set a goal for?

SoCalGardener — Sun, 08 Aug 2021 01:16:37 GMT

@Ezk37 wrote:
Thank you guys all for the info! The help is appreciated. What is the main purpose of closing unused accounts? Will it increase my chances of higher limit/better cards going forward? Or is it just because they aren't needed?

It's really a matter of personal choice. The cards I have, but almost never use, I'm keeping because of their impact on my total amount of credit (their credit limits are all in 5 figures); I don't want to lose that. But if I had a card with an annual fee, AND it was no longer serving any real purpose, I'd probably close it--even if losing it did have a painful impact on my total credit. But other people would keep them. It's so personal, depending on your needs, and your resources, and all sorts of stuff! Also, if I had any 'starter' cards and/or cards I didn't consider desirable, I'd want to lose them as soon as feasible, in other words, as soon as they're no longer serving any purpose (like rebuilding credit). I just wouldn't want to see them any more!

As for increasing your chances for future cards, having several may or may not help. Some people are declined when they apply for a new card and the reason cited is "too many credit cards," while others have 50, 60 or more cards and don't have any issues.

Re: What card should I set a goal for?

Anonymous — Sun, 08 Aug 2021 02:28:42 GMT

@Ezk37 wrote:
I have listed here the cards/limits I have currently. Any advice on what card I should set a goal for next? Or maybe I already have too many? What do you guys think? Should I just go for CLI's on the ones I already have and not try for more cards? I know there are many other factors involved like CS and 5/24 and such but I'm just wondering what cards I might look forward to in the future?

Credit One Amex - $800
Credit One Platinum - $700
Capital One Walmart - $550
Capital One Secured - $501
Capital One Quicksilver One - $500
Synchrony B&H - $3000
Discover Cash Back -$9000
Target Red Card - $600
Fingerhut - $1000
Comenity Victoria Secret - $600
Daniels Jewelers - $568

5 total auto loans - 3 paid off.
1 baddie 60-90 late from 2015
1 $220 derogatory utility account

I've been floating around the forums here for months. Recently checking daily. Any advice would be greatly appreciated. Thanks!

Getting more credit cards at this point for you won't do you any good. Based on the cards you have and the CL on them I would guess your scores are not over 720. If I was you I would just work on getting CLI on the cards I have. Use a few of them monthly paying them off to get your scores higher. Once higher then apply for top tier cards and stop applying for store type cards or bottom feeder cards like Credit one. Just my advice. You have enough cards already.

Re: What card should I set a goal for?

Horseshoez — Sun, 08 Aug 2021 02:37:14 GMT

@Anonymous, well said, my thoughts exactly!

Re: What card should I set a goal for?

Anonymous — Sun, 08 Aug 2021 02:48:11 GMT

@Horseshoez wrote:
@Anonymous, well said, my thoughts exactly!

Thanks! @Horseshoez

Re: What card should I set a goal for?

Ezk37 — Sun, 08 Aug 2021 03:22:41 GMT

Thank you for the advice. This is pretty much exactly what I had in mind to do. You are correct. I hover between 690 and 710 lately. Mostly because I carry balances on the cards I have. I'm at 36% usage overall, which I know is a big no/no. I believe that once paid off (which is the only thing I plan to do going forward.) I will be around 725ish. I plan to transfer all balances ($3200) over to the Discover once I receive it and pay it off completely. Discover is offering 14 months 0% interest. After they are paid off I will only use the Discover. (Maybe put Netflix or something on the others and not carry a blance.) I was just trying to figure out the best plan to push from 725ish to the beautiful 760-820. As always I appreciate all the help. Thanks!

Re: What card should I set a goal for?

Anonymous — Sun, 08 Aug 2021 05:54:45 GMT

Once you move the balances onto Discover, you'll have a pile of zero-balance accounts. That'll help in scoring. Paying off the Disco card will make a big difference too. Utilization is the second-biggest factor in scoring as outlined above. When I did a paydown from ~37% to single-digits, I gained 55-70 points on my scores.

I agree with the above advice. Dump the Fingerhut and Credit One cards to start, and work on some increases for cards you plan to keep. The rationale behind closing unused and unneeded cards is that you don't have to think about them anymore, and you don't have to worry about fraud or mistakenly using one and forgetting to pay the bill. Peace of mind is what you gain. You are well on your way to bigger and better cards. Let the starters go.

Re: What card should I set a goal for?

Ezk37 — Sun, 08 Aug 2021 13:59:28 GMT

CK sim shows a 54 point gain for paying off the $3200 I owe. This will be a lot easier with the 0% interest for 14 months. I'm looking forward to it. I should be pretty close to 740 by the time Disco is paid off. It's also good to know that closing the old bottom feeders won't hurt my AAoA. One or two of them have an AF and I can't wait to get rid of them. I'll definitely start with the AF cards and the ridiculous APR with Fingerhut. I really didn't expect $9000 from Disco. I'm pretty excited to get this ball rolling with some speed behind it!

Re: What card should I set a goal for?

SouthJamaica — Sun, 08 Aug 2021 17:18:54 GMT

@Ezk37 wrote:
I guess I'm mostly just concerned with increasing my credit scores. I completely agree about having a small handful of decent cards rather than 100 low limit high APR no perk cards. I'm going to be in this for the long haul when it comes to driving my score up, so at this point I guess that's my only real concern. If I'm being honest I had never really considered what I want in a card because I had never had a choice. I started with the Daniels jewelers account 15 years ago and completely ruined my credit with collections and tons of lates. (They have all since been removed or fallen off except 1 late from 2015 and a $220 collection for a utility bill.) I got my first $3000 card (the synchrony) about 7 months ago and was approved for the $9000 Discover last night. I won't have any true need for any of the smaller accounts/cards after receiving the Discover and honestly it wouldn't make sense for me to use ANY of the other cards or accounts at this point. I was just afraid to close the older accounts because it will seriously drop my AAoA. Total credit limit shouldn't be effected as much because the Discover $9000 now makes up over half of my overall limit. I'm aware that I need to have a decent mix of installment/charge/department store accounts as well? So I would need to calculate any closures carefully. Would you suggest taking the hit on the older accounts even if I'm sure I could sock drawer them for eternity? Will having them open spook better lenders? In answer to the question of what type of card I would enjoy.. I do like the cash back type. I couldn't care less about flight miles or hotel points really as I don't travel. Lower APRs are nice as well. Although my main concern is rasing my credit score. Thanks for the response!

If your primary concern is to improve your credit scores then your best bet is to:

1. not apply for any new card

2. not apply for any CLI which could trigger a hard pull

3. pay in full all accounts every month

4. pay off all but one of them before the reporting date (usually the statement date)

Re: What card should I set a goal for?

Horseshoez — Sun, 08 Aug 2021 18:18:19 GMT

@Ezk37 wrote:
CK sim shows a 54 point gain for paying off the $3200 I owe. This will be a lot easier with the 0% interest for 14 months. I'm looking forward to it. I should be pretty close to 740 by the time Disco is paid off. It's also good to know that closing the old bottom feeders won't hurt my AAoA. One or two of them have an AF and I can't wait to get rid of them. I'll definitely start with the AF cards and the ridiculous APR with Fingerhut. I really didn't expect $9000 from Disco. I'm pretty excited to get this ball rolling with some speed behind it!

The CreditKarma simulat is beyond worthless; don't rely one iota on anything it says. As for hitting 740, don't bet on it; their simulator calculates Vantage which is irrelevant when it comes to credit scores.