"Closing accounts would likely result in a lower credit score. Two of the five FICO scoring categories are directly affected when you close an old card: credit utilization and length of credit history."
"Assume his 18 cards carry an average credit limit of $10,000, giving him roughly $180,000 in total available credit. If he charges $4,000 a month across his three active cards and pays in full, his reported utilization is around 2%."
"Closed accounts in good standing stay on your report for about 10 years, then fall off. A card opened in 2008 and closed today still helps your average age of accounts until 2036."
"If you want to close some that have annual fees that you're not using, fine, if you're getting no benefit from them."
Maintaining 18 credit cards can positively impact credit scores, as demonstrated by a listener with a score of 830. Closing dormant cards may lower the score due to effects on credit utilization and length of credit history. For example, closing 10 unused cards could increase utilization from 2% to 5%. Closed accounts remain on reports for about 10 years, aiding average account age. Keeping the oldest and highest limit cards is advisable, while cards with annual fees can be closed if not beneficial.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]