topic Re: Niche credit cards that are paid off...now what? in General Credit Topics

Niche credit cards that are paid off...now what?

Anonymous — Fri, 28 Jan 2022 04:27:41 GMT

Forgive me if this question has been answered in other forums, but I'd like some advice please. I recently paid off specific credit cards where I have no use for them anymore. For example, wedding rings from Jared Jewelers / Comenity Bank and Sleep Number by Synchrony Bank. What do I do with these cards now? I don’t believe I can make general purchases with them outside of Jared / Sleep Number, so do I leave them open and not use them? After months of not using, won't the banks close the account and it'll hurt my credit?

In addition to paying off these cards, I also paid off all other credit card debt so I’m excited that my credit score has jumped up significantly. Any advice is appreciated.

Re: Niche credit cards that are paid off...now what?

FinStar — Fri, 28 Jan 2022 04:57:45 GMT

@Anonymous wrote:
Forgive me if this question has been answered in other forums, but I'd like some advice please. I recently paid off specific credit cards where I have no use for them anymore. For example, wedding rings from Jared Jewelers / Comenity Bank and Sleep Number by Synchrony Bank. What do I do with these cards now? I don’t believe I can make general purchases with them outside of Jared / Sleep Number, so do I leave them open and not use them? After months of not using, won't the banks close the account and it'll hurt my credit?

In addition to paying off these cards, I also paid off all other credit card debt so I’m excited that my credit score has jumped up significantly. Any advice is appreciated.

Hi @Anonymous, welcome to the forums.

If you don't anticipate using the Jared Jewelers and Sleep Number accounts, you can simply let them go inactive until they close on their own.

You may have to monitor them periodically just to make sure there's no surprise charges (i.e. fraud). Or, if you prefer to close them yourself, you also have that option. Once closed, they will remain on your credit reports for up to ~10 years (give or take), but they will still factor into your AAoA metrics.

Re: Niche credit cards that are paid off...now what?

SouthJamaica — Fri, 28 Jan 2022 14:37:49 GMT

@Anonymous wrote:
Forgive me if this question has been answered in other forums, but I'd like some advice please. I recently paid off specific credit cards where I have no use for them anymore. For example, wedding rings from Jared Jewelers / Comenity Bank and Sleep Number by Synchrony Bank. What do I do with these cards now? I don’t believe I can make general purchases with them outside of Jared / Sleep Number, so do I leave them open and not use them? After months of not using, won't the banks close the account and it'll hurt my credit?

In addition to paying off these cards, I also paid off all other credit card debt so I’m excited that my credit score has jumped up significantly. Any advice is appreciated.

They're not hurting your credit now. And if they get closed by the lender, that won't hurt your credit then. I'm not highly experienced with store cards of that nature, but I'm pretty sure they leave them open, when inactive, longer than regular bank cards. So my advice would be to let them rest in your sock drawer.

Since you've paid off all your cards, be careful to let at least one bank card report a small balance each month before you pay it off, so you don't get hit with the "all zero" penalty.

Re: Niche credit cards that are paid off...now what?

SoCalGardener — Fri, 28 Jan 2022 19:39:02 GMT

In addition to the excellent suggestions already given, I think you should consider how big a role these cards are playing in your overall credit picture. If their limits contribute a significant percentage of your overall credit, closing them could hurt in that regard.

If they have annual fees and you're not going to use the cards, either ask about eliminating the AFs or just go ahead and close them.

I've had precisely *one* card closed due to inactivity, and something I didn't know until that happened is that I wish I had closed it myself. Why? Because when the bank closed it, they simultaneously reduced my CL down to a tenth of what it had been! So although its history remained on my reports for 10 years, it didn't accurately reflect my real credit limit. I have no idea if either card you're talking about would do something similar, but to avoid it you might want to go ahead and close them yourself, if closing them is what you ultimately decide is best.

Re: Niche credit cards that are paid off...now what?

Anonymous — Fri, 28 Jan 2022 20:34:15 GMT

@SoCalGardener

Forgot about that ... had that happen where they reduced it from $10K to $500 and closed. That is a sleeper move ...

Re: Niche credit cards that are paid off...now what?

SoCalGardener — Fri, 28 Jan 2022 20:41:27 GMT

@Anonymous wrote:
@SoCalGardener

Forgot about that ... had that happen where they reduced it from $10K to $500 and closed. That is a sleeper move ...

Yeah, it's like adding insult to injury! So I forgot to use my card....for a year...okay, fine, close it, but cut its reported CL by 90%? Really?!