Which credit cards should I close?
Please don’t say none, becuase I have WAY too many (8 and I’m only 20!)
Capital One-This is my first card, so I think I should keep this for the history..
Best Buy-1,400 limit…never use it, balance is small like 65.00, so I could close this fast..
Bank of America-7,000 limit just opened to save money on Balance Transfers for zero percent..
Chase-6,200 limit…never use, However, it is my overdraft protection for my checking, so its rather important…
Citi- 2,800 limi- currently has a 1,500 balance at 0% until next october
Discover-1,000 limit….don’t use very often, but I owe 500 on it…zero percent until april
GM Flexible Earnings Card by HSBC-$750.00 limit…NEVER use, only got it because I bought a brand new car and thought it might be nice to have a card that can help me save towards a new car..
Citi (#2)-4,500 limit….currently owe 800.00 at 1.99% until August
Which ones should I work on closing?
*Capital one has a 1,500 balance at 1.99 for life
Tags: close, overdraft protection, Credit, Should, brand new carRelated posts:
close the smallest one
Discover. Their finance method is the worst: two-cycle average. Keep only cards that use the Average Daily Balance method.
The two-cycle average means that if you carried a balance one month and then pay in full the next month, you still get finance charges for TWO more months.
keep Citi close rest of them and if their is Virgin money services get that, but honestly i use Visa Debit card. i put 100 dollars every month and i use my own money. it is just an addiction, you work hard and earn money but credit card they give you some bodies money as loan and earn as an interest from you.
the only thing you save here is interest rate that you pay on your spending, insurance etc…
Visa Debit ..think about it.
I wouldn’t be in a hurry to close all unnecessarly accounts until you pay some of them off. Your credit rating takes into effect: money owed / possible credit you could use. This means if you cancel cards, your rating could go down.
I’d get rid of the Best buy one, and then look at your card agreement. FIgure out which ones will go highest interest rate after the introductory period. You’ll usually find something like Prime Rate +5%. I’d definitely work towards cutting it down to about 3 cards. Keep the ones that you have had open the longest.
Also, look at which ones have a yearly fee, and which have tricky stuff like a double month revolving balance. I’m not sure that name is right, but the concept is that you have to pay your credit card off in full and/or not make any charges the following month to get out of your interest payment.
Sounds like you know what to do.
You’re right, you should keep the Capital One card. It has a good interest rate and it is the oldest.
Close the Best Buy, Close the GM, and maybe close the Citibank #2.. You should be able to find a transfer for that balance to a 0% one through Capital one or Citi #1. You might also want to cancel the Discover.
You don’t want too many open cards, but you also don’t want no credit history. Go ahead and keep the ones that are oldest and have good history and %.
Work on paying off what you can, and if you have any cards that charge fees get rid of them. If you pay them though I know you said I would not worry about closing them because keeping them open will improve your credit to debt ratio and help your FICO score. Everytime you open a new card your FICO score takes a hit, so don’t close them if you don’t have to. You might want to consolidate them all on a card with the lowest rate, and if you can not resist using them after they are paid off then close them.
Credit cards are Satan’s ugly cousin, they are great in an emergency, but once you sell your soul it’s hard to get it back.
You seem to have a reason for each of the credit cards in your possession. The question is which is the most useful( Capital ) and which is a good backup. Your interest at.0199 is very favorable for Capital and pick one other as standby. Payoff and cancel the others.
*** Alert ***
Closing credit card accounts will affect your credit rating.
So unless there’s an annual fee, or something else negative
about keeping it open, I personally would not close a credit
card account, even if I don’t use it.
Here’s the deal on cards- if you close them, you actually take a ding on your account (don’t ask me the rationale, I don’t own a bank…).
The best way to improve your credit score is to charge a little every month and PAY THE CARD OFF. Proves you are reliable, proves you use your credit, and if you pay it off before the 30 days, most cards charge no interest.
I understand you want out from under a few of these, but what’s the problem with tucking them away for a rainy day? Pay them off, seal them in an envelope, give them to a trusted friend/family member who will leave them sealed and out of sight, out of mind except in a (REAL!) emergency.
That said, if I had to close some, I would pay them down and I would keep the top 3 limits open while killing the other cards. The goal needs to be zero debt, so the deals each one offers should be moot.
Good luck!
Just as a couple of added notes…
The amount of time you’ve had the card is not everything. Have you been USING the Capital card since you’ve had it? How many months from current back you have paid on time affects your score positively. If you had it but weren’t using it, that doesn’t really do anything.
I agree with keeping the ones with the good rates, though I’d want to consolidate, which would allow you to keep an extra just in case they offer a different teaser rate. The Bank of America isn’t gonna keep that rate forever, but you could transfer some that you think you can pay off for however long the rate is going to last. (Cause it could jump up drastically when that’s done. But they’ll eventually offer something again if you need to transfer again.)
Also, lenders do not just look at your score. They look at your report, your income, etc. They look at how much debt potential you have. And if it were me, despite your score, I’d have doubts about a 20 year old with 8 credit cards! You’re young enough to build credit, and quite personally I’d dump most of them, especially ones you’ve never used and have no history. That’s just my opinion.
And I wouldn’t worry about stuff like covering overdrafts on your checking. Don’t bounce checks. :-) I just don’t think it’s worth it, with the added temptation of using the card, and the interest it could cost you if you do.
close the following cards:
discover,
citi (1),
citi (2)
best buy,
GM Flexible card,
and keep the others. spend wisely!
I recommend closing them all and work on paying them off. It’s obvious you have a problem with credit cards. Don’t feel bad most people do. Credit cards can be evil things. I recommend reading Dave Ramsey’s book “Total Money Makeover”. You should be able to find it at your local library. You need to change how you look at money before you find yourself filing for bankruptcy by the time you are 30. I wish you luck and freedom from debt.