Close Credit Card

It may seem like common sense to close a credit card if you are not using it, but this is not usually the case. You should never be in a hurry to close out an existing credit account. The first reason is that closed accounts will be dropped from your credit report in time. This would lower the average age component of your credit accounts. 

Besides this, when you close one of your credit cards, you remove a portion of your total available credit. This action alone can create an immediate negative effect on your personal credit score

Remember that open accounts which are inactive do not hurt your credit score, but they can boost it by raising your total available credit. 

A reason that you might want to close a card that you are not using is if  it comes with a yearly fee. Closing such a card would save you money. Before you do this, it is a smart idea to call the issuer of this credit card and ask them to either waive the annual fee (for a year or more) or to convert the card to another type of account that does not come with a yearly fee. 

Doing so would enable you to keep the average account age higher for your credit report, which translates to higher credit scores in the end. 

Remember that there is no harm in having an open credit card that sits idly in your wallet. Even unused it is creating benefits for your credit history and score. 

Think carefully before closing any credit card account.

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