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RIP | when is it a good time to close a TL?

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Established Contributor

RIP | when is it a good time to close a TL?

Used the search tool and read several posts. None discussed the timing or best practice, only folks sharing that they closed their unwanted cards. Now that my profile is growing and years past being a thin file, is there a best practice to closing starter credit cards?

 

For me, it’s my $626 secured Cap 1 card and my Jared Galleria of Jewelry account.  All my other accounts are growing beyond $10k CL and I’d like to RIP cards that have no chance of keeping pace.  

 

Edit: I am asking because I don’t know how this will affect my profiles (score drop, AA, change in AAoA, etc). 

 


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Super Contributor

Re: RIP | when is it a good time to close a TL?


@_NERD wrote:

Used the search tool and read several posts. None discussed the timing or best practice, only folks sharing that they closed their unwanted cards. Now that my profile is growing and years past being a thin file, is there a best practice to closing starter credit cards?

 

For me, it’s my $626 secured Cap 1 card and my Jared Galleria of Jewelry account.  All my other accounts are growing beyond $10k CL and I’d like to RIP cards that have no chance of keeping pace.  

 

Edit: I am asking because I don’t know how this will affect my profiles (score drop, AA, change in AAoA, etc). 

 


Generally I think people overstress about closing cards. If it's not going to make your utilization skyrocket or something, IMO you're always good to go with closing accounts you don't need. I've never heard of AA happening because you chose to close an account. Even so, AA can happen at any time for any reason anyway, so it's not a reason to keep worthless accounts open.

 

Your AAOA will be unaffected by the account closing. It will remain on your reports for 10 years after closing and will continue to factor in until then.

 

I'd just close the starter cards without hesitation.

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Valued Contributor

Re: RIP | when is it a good time to close a TL?

I concur, even if either one is the oldest account by a few years, the AoOA effects in 10 years would be insignificant if any, life if too short to babysit useless cards.
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Frequent Contributor

Re: RIP | when is it a good time to close a TL?

My rule is if there is an annual fee and not enough benefit to compensate, it gets axed -- careful to wait until about the year period, as you might jeopardize your relationship with the card holder if you cancel early after getting a sign up bonus.  Second consideration is if it's a card with a sign up bonus that I might want to get again down the road, in which case I'll cancel or product change it.  Other than that, I personally don't mind having a lot of cards open and have no problem managing it.



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Valued Contributor

Re: RIP | when is it a good time to close a TL?

Cancel the cards you don't want in the next few days, and begin 2019 with a clean deck of just the cards you want.

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Mega Contributor

Re: RIP | when is it a good time to close a TL?


@UpperNwGuy wrote:

Cancel the cards you don't want in the next few days, and begin 2019 with a clean deck of just the cards you want.


Yes.   But also don't just go by CL.  This forum seems obsessed with the notion that cards need to "grow" even those where there are low caps on rewards (such as Freedom, Discover etc).  So long as the CL is "usable" a great card will still be great.   My late Citi Forward and Sallie Mae (both RIP) cards had CLs well below my average, but were very valuable, much more than some of the cards with much higher CLs.

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Established Contributor

Re: RIP | when is it a good time to close a TL?


@longtimelurker wrote:

@UpperNwGuy wrote:

Cancel the cards you don't want in the next few days, and begin 2019 with a clean deck of just the cards you want.


Yes.   But also don't just go by CL.  This forum seems obsessed with the notion that cards need to "grow" even those where there are low caps on rewards (such as Freedom, Discover etc).  So long as the CL is "usable" a great card will still be great.   My late Citi Forward and Sallie Mae (both RIP) cards had CLs well below my average, but were very valuable, much more than some of the cards with much higher CLs.


I closed my Capital One $626 secured card.  It took some legwork to access my Jared online account because that account is now being serviced by Genesis Financial Solutions. Now that I have access to that account online again I can see the user interface is identical to the Genesis/Ashley Furniture account I closed earlier this year.

 

When I click the Credit Limit Increase Information link in my Genesis/Jared account, the site says: 

Q: How can I increase my limit?

A: There is not a credit limit increase program at this time.

 

The Genesis rep I spoke with on the phone said I have to go to a Jared store and a store employee would have to call them to request a CLI. She went on to say that by looking at my credit profile, there would be no problem getting the limit increased. 

 

Does anyone think I could pull off a CLI without buying something expensive?  Smiley Wink


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Established Contributor

Re: RIP | when is it a good time to close a TL?


@_NERD wrote:

I closed my Capital One $626 secured card.  It took some legwork to access my Jared online account because that account is now being serviced by Genesis Financial Solutions. Now that I have access to that account online again I can see the user interface is identical to the Genesis/Ashley Furniture account I closed earlier this year.

 

When I click the Credit Limit Increase Information link in my Genesis/Jared account, the site says: 

Q: How can I increase my limit?

A: There is not a credit limit increase program at this time.

 

The Genesis rep I spoke with on the phone said I have to go to a Jared store and a store employee would have to call them to request a CLI. She went on to say that by looking at my credit profile, there would be no problem getting the limit increased. 

 

Does anyone think I could pull off a CLI without buying something expensive?  Smiley Wink


In the past year or so I have slowly started adopting the opinion that excessive CLIs that you won't need, especially on cards that you don't use or use very rarely are to be avoided. Obviously, if it's your daily driver, then a CLI that comfortably pads your utilization is a good thing. But large CLs on cards that are of no use can become a hindrance when you apply for new credit that may be more useful. Many lenders will calculate a total available credit for you that they think is acceptable or reasonable to them based on what they think your credit profile and income can support. Having excess CLs just eats into that and may prevent them from extending you much credit when you app. 

 

tl;dr the purpose of CLIs imho is to ensure that you have a comfortable margin overall and especially on cards you do use so that you don't run into util troubles. Anything beyond that is mostly useless at best and detrimental to future growth at worst. 

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