cancel
Showing results for 
Search instead for 
Did you mean: 

"It will stay on your report for ten years," but what then?

tag
Anonymous
Not applicable

"It will stay on your report for ten years," but what then?

When people ask about closing unused cards, I almost always argue against it, in part for the purposes of AAoA. I get pushback from others arguing that "the accounts will stay on your report and continue to help your AAoA for ten years." But my question is, "what happens after ten years?"

 

And being on the other side of ten years since cards have been closed, I can tell you, I was right. You shouldn't close cards.

 

In the first half of 2007, before I really started to pay attention, I let five cards be closed for non-use. Some had been open since 1983. I could have kept them alive by merely making a charge every year or so. But I figured, "I never use these cards, and I have plenty of other credit, why do I need them?," so they got closed. No sweat, they stay on my report anyway, right?

 

Until now. It's 2017, ten years after the accounts closed, so they've now fallen off.

 

With those accounts in my portfolio, my AAoA would be 8.5 years. With those accounts out of my portfolio, my AAoA is 6.5 years.

 

Is it the end of the world? No, my credit score is still fine. But it does drag it down, and every time I go to apply for a new card, I'm keenly aware of the amplified effect a new account has on my AAoA and score. Those new accounts wouldn't have nearly the same effect if those five cards (including some which would have 34 years of history) were still alive.

 

Ten years might seem like a long time in the future, as if something that will only affect you in ten years isn't to be concerned about. But unless you're 112 years old, it is.

 

Unless they charge an annual fee, keep those cards open. High limit, low limit, major cards, store cards, doesn't matter. They all help your AAoA.

 

Chris.

Message 1 of 25
24 REPLIES 24
JR_TX
Valued Contributor

Re: "It will stay on your report for ten years," but what then?

In your case you're absolutely correct! I guess the only counter-argument that applies is if you have a card/s that are opened close to the cards that will be closed, say within 3-5 years? In which case, the effect to the AAoA in relation to the FICO scoring system will be not much significant since those remaining open card/s can carry on the aging load for AAoA purposes. For someone that streeses a lot about non-usage of an aging card and/or the AFs that those CCs incur, then closing them might make sense given the situation above exists.
New cc TLs : 0/6 ; 0/12 ; 0/24 | HPs EX 3 EQ 3 TU 4 | AAoA 7y10m | UTIL 1% - 4% | $300K+ Total Limits

Message 2 of 25
AverageJoesCredit
Legendary Contributor

Re: "It will stay on your report for ten years," but what then?

I guess the simplirst way to keep cards for so long is just to mske a purchase on it once in awhile. Its not that complicated. With online options nowadays, you dont even have to leave the comfort of your own chair to maintain activitySmiley Wink

Now quick note ,there's a huge difference in wanting to close a card thats been open 6 to 12 months compared to card you've had 20 plus yearsSmiley Wink
Message 3 of 25
wasCB14
Super Contributor

Re: "It will stay on your report for ten years," but what then?

I haven't been declined for anything since my one card at the time was 4 months old. Worrying about 6.5 vs. 8.5 years seems odd to me.

 

I don't have any baddies and do light bonus chasing.

 

Edit: 1000th post!

Personal spend: Amex Gold, Amex Schwab Plat., BofA PR+CCR(x2), Costco
Business use: Amex Bus. Plat., BBP, Lowes Amex AU, CFU AU
Perks: Delta Plat., United Explorer, IHG49, Hyatt, "Old SPG"
Mostly SD: Freedom Flex, Freedom, Arrival
Upgrade/Downgrade games: ED, BCE
SUB chasing: AA Platinum Select
Message 4 of 25
SouthJamaica
Mega Contributor

Re: "It will stay on your report for ten years," but what then?


@Anonymous wrote:

When people ask about closing unused cards, I almost always argue against it, in part for the purposes of AAoA. I get pushback from others arguing that "the accounts will stay on your report and continue to help your AAoA for ten years." But my question is, "what happens after ten years?"

 

And being on the other side of ten years since cards have been closed, I can tell you, I was right. You shouldn't close cards.

 

In the first half of 2007, before I really started to pay attention, I let five cards be closed for non-use. Some had been open since 1983. I could have kept them alive by merely making a charge every year or so. But I figured, "I never use these cards, and I have plenty of other credit, why do I need them?," so they got closed. No sweat, they stay on my report anyway, right?

 

Until now. It's 2017, ten years after the accounts closed, so they've now fallen off.

 

With those accounts in my portfolio, my AAoA would be 8.5 years. With those accounts out of my portfolio, my AAoA is 6.5 years.

 

Is it the end of the world? No, my credit score is still fine. But it does drag it down, and every time I go to apply for a new card, I'm keenly aware of the amplified effect a new account has on my AAoA and score. Those new accounts wouldn't have nearly the same effect if those five cards (including some which would have 34 years of history) were still alive.

 

Ten years might seem like a long time in the future, as if something that will only affect you in ten years isn't to be concerned about. But unless you're 112 years old, it is.

 

Unless they charge an annual fee, keep those cards open. High limit, low limit, major cards, store cards, doesn't matter. They all help your AAoA.

 

Chris.


I agree with you.

 

It should also be pointed out that the "10 years" business isn't written in stone.  I had 5 accounts which I closed within the past year disappear from my Equifax reports entirely a few months ago. One of them was a very old account which is now gone from my EQ report and has had a big impact on my EQ average age of accounts.

 

 


Total revolving limits 741200 (620700 reporting) FICO 8: EQ 701 TU 704 EX 685

Message 5 of 25
Viva-LV
Frequent Contributor

Re: "It will stay on your report for ten years," but what then?

I closed 5 cards in January, including a Cap One Plat that was 10 years old.  My AAOA took a dive, as did all three scores, each -25 to -30 points.  Scores are climbing back up, but it's something to consider when closing an account.  Lesson learned!

Am Ex | BOA | Chase | Citi | Disc | PenFed | USB | 400K Club
Message 6 of 25
Gmood1
Super Contributor

Re: "It will stay on your report for ten years," but what then?

^^^ I closed 8 or 9 last year. I've decided not to do that anymore! All mine will be open till I'm dead or the lenders take them away! Lol

 

My AAoA took major hits when I opened a bunch of accounts in 2015. Now with all of these accounts reporting. My AAoA is low but like the man of steel!

A new account here or there has little to no affect on it. I have 46 accounts reporting now opened and close.

Message 7 of 25
wasCB14
Super Contributor

Re: "It will stay on your report for ten years," but what then?

It would be too much babysitting for me. A card has to earn its keep...or at least share a login with a card that does (like BCE and ED haven't been getting any decent offers for a while, but are easy to manage when I'd have a Platinum, anyway).

 

I have more of a cash cushion than most, though...so some of you may want to keep your Barclaycard NFL and Rewards cards.

Personal spend: Amex Gold, Amex Schwab Plat., BofA PR+CCR(x2), Costco
Business use: Amex Bus. Plat., BBP, Lowes Amex AU, CFU AU
Perks: Delta Plat., United Explorer, IHG49, Hyatt, "Old SPG"
Mostly SD: Freedom Flex, Freedom, Arrival
Upgrade/Downgrade games: ED, BCE
SUB chasing: AA Platinum Select
Message 8 of 25
Themanwhocan
Senior Contributor

Re: "It will stay on your report for ten years," but what then?

Having a large aaoa might be nice, if my goal was to have a 850 FICO score. But its not. I see no advantage/profit with 850 that I wouldn't see in 760+ scores.

 

I have good scores, and my aaoa is only over 2 years. Even so, my FICO 09 score from NFCU was 805 for some inexplicable reason. I want a good score so I can profit from it, and in my case that means obtaining signup bonuses, as well as whatever the latest cards are that give good rewards that I can use. I don't see the 850 score as a goal, since obtaining that would mean giving up other (profitable) goals.

 

Keeping a good number of cards active can be good for utilization ( I have over $400k in total limits). But closing cards gives the opportunity to combine limits, and to eventually qualify for more signup bonuses from the same creditors. Its also fewer cards that can be compromised, and I already get 1-2 cards compromised each year as it is.

 

So, I don't see a problem with closing a few cards each year. Especially since I open a few cards each year. As long as you keep a thick file, and large enough credit limits to pad utilization numbers, then everything else should be based on what your goals are.





TU-8: 804 EX-8: 805 EQ-8: 788 EX-98: 767 EQ-04: 752    
TU-9 Bankcard: 837 EQ-9: 823 EX-9 Bankcard: 837
Total $443,800
Message 9 of 25
pipeguy
Senior Contributor

Re: "It will stay on your report for ten years," but what then?


@Themanwhocan wrote:

Having a large aaoa might be nice, if my goal was to have a 850 FICO score. But its not. I see no advantage/profit with 850 that I wouldn't see in 760+ scores.

 

I have good scores, and my aaoa is only over 2 years. Even so, my FICO 09 score from NFCU was 805 for some inexplicable reason. I want a good score so I can profit from it, and in my case that means obtaining signup bonuses, as well as whatever the latest cards are that give good rewards that I can use. I don't see the 850 score as a goal, since obtaining that would mean giving up other (profitable) goals.

 

Keeping a good number of cards active can be good for utilization ( I have over $400k in total limits). But closing cards gives the opportunity to combine limits, and to eventually qualify for more signup bonuses from the same creditors. Its also fewer cards that can be compromised, and I already get 1-2 cards compromised each year as it is.

 

So, I don't see a problem with closing a few cards each year. Especially since I open a few cards each year. As long as you keep a thick file, and large enough credit limits to pad utilization numbers, then everything else should be based on what your goals are.


+10 

 

I agree with this post, I have a very thick file, AAoA right around 6 years and I close accounts all the time if they become useless (still maintain 24 open CC accounts) I also tend to open 1 or 2 or 3 cards per year because I'm a sucker for promotional 0% APR's and early spending cash (made over $500 in 2016 in intro spending cash). Oldest card reporting 1978 which I rarely use, newest card reporting May 2017. 

Message 10 of 25
Advertiser Disclosure: The offers that appear on this site are from third party advertisers from whom FICO receives compensation.