How do you handle credit cards you no longer use?

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Tree Guy
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How do you handle credit cards you no longer use?

Post by Tree Guy »

I don't know if it's still true, but in the past I read that you shouldn't cancel a credit card you no longer use as it may affect your credit. Is it best to use them occasionally even if it's only a minor purchase or just not use them?
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arcticpineapplecorp.
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Re: How do you handle credit cards you no longer use?

Post by arcticpineapplecorp. »

if you don't use cards for small purchases now and again they will be closed and that might lower your score initially. It could recover, depending upon how many other cards you have. If you have two and go to 1 it's possible your score might not improve because you should have at least 2 or 3 major cards to positively impact your score.

I have maybe 13 or 15 and just rotate most of them every few months (micro purchase) and pay it off a day or two later.
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flyingaway
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Re: How do you handle credit cards you no longer use?

Post by flyingaway »

Normally, they will send you a letter and tells you that your card has not been used for some time and the account will be closed if you do not use it in 30 days. The problem will be solved.

Or when the old card expires, they will send you a new one. Do not activate the new one.
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Re: How do you handle credit cards you no longer use?

Post by 123 »

We use all our credit cards on a regular basis. Using a number of cards can help you track your budget and expenses easily. For example one card for food/grocery expenses, one for transportation/travel expenses, one for clothing/household purchases, one for health care/prescriptions, etc. If some cards offer various rewards you can assign those in a manner to maximize their value.
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Barsoom
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Re: How do you handle credit cards you no longer use?

Post by Barsoom »

I have three credit cards: one card I've had for decades, which was a department store card converted to a Visa, a second card issued by my credit union, and a third card that was a promo from a cruise line offering on-board credit and no international transaction fees.

I use the first card for all my purchases since it's a legacy card and not affiliated with my bank. I stopped using the second card and use it only if the first card is breached. I haven't used the third card because Covid hit right after I got it.

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mptfan
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Re: How do you handle credit cards you no longer use?

Post by mptfan »

I cancel credit cards that I no longer intend to use.
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Re: How do you handle credit cards you no longer use?

Post by iamblessed »

I just keep two open the rest I close or let them close.
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Re: How do you handle credit cards you no longer use?

Post by oldfort »

Tree Guy wrote: Mon Dec 07, 2020 3:58 pm I don't know if it's still true, but in the past I read that you shouldn't cancel a credit card you no longer use as it may affect your credit. Is it best to use them occasionally even if it's only a minor purchase or just not use them?
If you don't use a card ever, most credit card companies will eventually close the card as an inactive account. If you want to keep the card, you should try to use it occasionally.
teamDE
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Re: How do you handle credit cards you no longer use?

Post by teamDE »

The metrics of interest to your credit score are your average length of credit history and the ratio of utilized available credit. If you close an account with a long history and a high credit limit, it'll bring down both metrics.
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avenger
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Re: How do you handle credit cards you no longer use?

Post by avenger »

Cancel.

I only have two cards. One for joint purchases with my partner, one for individual purchases.
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wander
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Re: How do you handle credit cards you no longer use?

Post by wander »

I cancel the cards that I no longer need.
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SmileyFace
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Re: How do you handle credit cards you no longer use?

Post by SmileyFace »

I've had some cards close due to non-use. Sometimes you get a warning and sometimes you do not.
The cards I keep as backups (for international travel, etc.) that I don't use and want to keep open I try to use on occasional - or - for one of them - I have a small yearly autopayment set up on it. I've thought about setting up a few more with some small autopayments to keep them opening when time allows (e.g. I pay $30 a year to Ring. $30 isn't much for points/cashback so that is one charge I could have auto-pay set up from a backup card).
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gr7070
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Re: How do you handle credit cards you no longer use?

Post by gr7070 »

Double post.
Last edited by gr7070 on Mon Dec 07, 2020 5:48 pm, edited 1 time in total.
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gr7070
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Re: How do you handle credit cards you no longer use?

Post by gr7070 »

After some time I throw the physical card away and don't think of them again.

Unless you're rather young with little credit history one doesn't need to take much action with their credit score in mind. Whether that's intentionally keeping a card open or intentionally closing. Neither really matters enough.

Simply having a couple credit cards, using them, paying them on time is all one needs to do to have a good score. Throw in a mortgage and/or car loan and that is way more than enough for a very good score.

Lastly never spend/lose money with the intent to improve your score. Focus on your net worth.

Way, way too much consideration is given to ones credit score.
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lthenderson
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Re: How do you handle credit cards you no longer use?

Post by lthenderson »

I just cancel them. I don't have a clue what my credit score is nor do I care. I already have a house with a mortgage payment and everything else in life I pay cash.
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Stinky
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Re: How do you handle credit cards you no longer use?

Post by Stinky »

I throw the unused credit cards into my home safe. We’ve got a lot of them because DW likes the store credit card “sign on” bonuses.

I don’t activate the store cards when they come. Eventually the store gets tired of us and cancels the card.

A credit card cancellation marginally reduces our credit score because available credit has been reduced. I don’t care about that.
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Re: How do you handle credit cards you no longer use?

Post by angelescrest »

For credit score purposes, I retain credit cards. Length the account has been open and the total amount of available credit, all help my score. You have to use them all. Simple solution is to use one for basic subscriptions, like NYTimes subscription or Disney+ or whatever else for a few bucks. I set it up so that it autopays for the service, and that the amount due on the cc is autopayed via my checking account. But I try to use one credit card the majority of the time for the better benefits.
anoop
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Re: How do you handle credit cards you no longer use?

Post by anoop »

I've never had a card cancelled on me, so I'd assume that using it once every 2 years is good enough. :)

Anyway, if I didn't use a card and thought it was a pain to keep around, I would get rid of it without worrying about impact to credit score. The impact is likely to be minimal and will reverse within a few months at most.
tj
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Re: How do you handle credit cards you no longer use?

Post by tj »

I've had a couple cancelled on me, there was no noticeable effect on my credit score.

I have several cards that I have not used in quite some time.

I occasionally get a letter that they will cancel it if I don't use it, when I do receive that letter, I tend to buy a $5 amazon gift card or something.
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JoMoney
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Re: How do you handle credit cards you no longer use?

Post by JoMoney »

Yes, closing a credit line lowers your credit score. Reducing the time of your "oldest line of credit" and your overall credit available also lowers the score.
... I don't care. I still close the accounts when I'm done with them. I've watched as my credit score drops 10 points and goes from "Excellent" to a lower number "Excellent"...
*shrug* :? :wink:
If I was about to apply for a home loan I might be more careful about watching my score, but I'm not, and I don't really care to use credit anyway. I use a credit card for the bonus points, and somewhat for the security, if they would never grant me a credit card again it wouldn't change my life to use a debit card or even cash.
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beyou
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Re: How do you handle credit cards you no longer use?

Post by beyou »

Seems a scam by banks to lure you in then threaten to lower your credit score for closing accounts. I have had cash back programs modified to point I stopped using a card. Another card has bad service and didn’t payout in a recent cash back offer. I realize banks do not literally set your credit rating, but they buy the rating and therefore endorse the rating methodology.

I am starting to think that if I see a card with great perks relevant to me, I will apply and then close my least favorite card. Preserving total credit line helps keep the rating up. Length of credit appears to be an illusion. One of the banks sites indicated my length of credit is good not excellent. I have a 20 year old credit card and many others for 5-10 years. If mine is not long then nobody has a long credit history, so this measure can be ignored.
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Doom&Gloom
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Re: How do you handle credit cards you no longer use?

Post by Doom&Gloom »

If it has an annual fee and I know I won't use it again, I cancel it. BTW just did this a few weeks ago.

If it does not have an annual fee, I'll toss it in a drawer and put an online charge on it (usually automatically) at least every three months.
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Re: How do you handle credit cards you no longer use?

Post by JDCarpenter »

angelescrest wrote: Mon Dec 07, 2020 7:17 pm For credit score purposes, I retain credit cards. Length the account has been open and the total amount of available credit, all help my score. You have to use them all. Simple solution is to use one for basic subscriptions, like NYTimes subscription or Disney+ or whatever else for a few bucks. I set it up so that it autopays for the service, and that the amount due on the cc is autopayed via my checking account...
Yep. As long as there is no fee on the account. We have cards opened in the 80's and 90's set up for nickel and dime (figuratively) monthly charges and autopay. Length of credit history, plus more than a few tens of thousands in unused credit lines.

Most charges are to chase saphire reserve and BoA's travel rewards (with the platinum honors multiplier), but it costs little to keep the old cards going.
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Re: How do you handle credit cards you no longer use?

Post by willthrill81 »

mptfan wrote: Mon Dec 07, 2020 4:43 pm I cancel credit cards that I no longer intend to use.
Same. I couldn't care less about the temporary tiny impact on my credit score.
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Re: How do you handle credit cards you no longer use?

Post by rotorhead »

Don't obsess over credit score. I closed out a card I had had for nearly 50 years; barely made a dent in my score. If you don't need them close them.
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teen persuasion
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Re: How do you handle credit cards you no longer use?

Post by teen persuasion »

They don't always give you warning before closing cards for lack of use. Just this week we got a letter that one of our cards was closed for lack of use.

Over time we'd just shifted everything to the cash back rewards card, and kept the other one as backup, or for the odd times the rewards card wasn't accepted someplace. Obviously everyone seems to accept it now, and with Covid hunkering us down, we must not have used the non-rewards card in a year or so.

We are generally ok with the simplicity of just one card, but I intend to eventually open a backup card in my name to cover our bases in an emergency.
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Re: How do you handle credit cards you no longer use?

Post by Broken Man 1999 »

If I don't use a credit card, I cancel it. No reason not to do so. In the last year or so I have cancelled four cards, and my credit score today hovers in the 82X range.

I do care about my credit score because insurance companies use the score as part of premium calculations.

Next up to be cancelled is PayPal. Just PayPal accounts, I don't have a PayPal credit card.

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Greywolf
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Re: How do you handle credit cards you no longer use?

Post by Greywolf »

I cancel credit cards I no longer use.
For example, several months ago I cancelled a travel card with an annual fee. Because travel is on hold for awhile with Covid and the company would not waive the fee I cancelled.
No meaningful affect on credit score.
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Re: How do you handle credit cards you no longer use?

Post by balbrec2 »

arcticpineapplecorp. wrote: Mon Dec 07, 2020 4:21 pm if you don't use cards for small purchases now and again they will be closed and that might lower your score initially. It could recover, depending upon how many other cards you have. If you have two and go to 1 it's possible your score might not improve because you should have at least 2 or 3 major cards to positively impact your score.

I have maybe 13 or 15 and just rotate most of them every few months (micro purchase) and pay it off a day or two later.
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Re: How do you handle credit cards you no longer use?

Post by Jack FFR1846 »

I use them for tradeline sales or for low balance forgiveness. Technically, both of these keep the cards in use. For others, they go into my safe. Some cards will issue a letter saying that if the card isn't used in 30 days, they'll cancel. If I want it to stay open, I'll buy something with it.
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Angelus359
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Re: How do you handle credit cards you no longer use?

Post by Angelus359 »

I used to have 19 credit cards.

I'm down to 4 now.

Some were canceled for non use.

Of the 4 remaining, 1 is explicitly on used for netflix. It's my oldest account.

The other 3 are used regularly for different purposes.
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Re: How do you handle credit cards you no longer use?

Post by MikeG62 »

Tree Guy wrote: Mon Dec 07, 2020 3:58 pm I don't know if it's still true, but in the past I read that you shouldn't cancel a credit card you no longer use as it may affect your credit. Is it best to use them occasionally even if it's only a minor purchase or just not use them?
If I were certain I would never use the card again, I would cancel it. Otherwise I would "sock drawer" it, using it if and when it made sense to do so (rotating bonus point category for example). If I wanted to hold onto it "just in case", then I would use it periodically (once or twice every few months) to try and ensure the card issuer did not cancel it from inactivity.

The CC I have with the highest charging capacity is my discover card. It's also my oldest card (had the card since the 1980's). I keep/use it for the rotating categories (which typically results in charges of up to $1,500 one or two quarters per year) and otherwise I charge my monthly iCloud subscription of $0.99 and the same for my wife. In the months where those are the only two charges, discover wipes off the charges with what they call a small balance credit. Guess they somehow feel that is a better outcome than chasing people down for small balances.
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hoffse
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Re: How do you handle credit cards you no longer use?

Post by hoffse »

If I have a card I no longer use or want to keep (annual fees, etc) I wait until the next time I am unfreezing my credit to get a new card. Once that new card is approved I immediately close any cards that are on the chopping block. My credit drops for a couple months but is back to normal within 90 days of doing this. Since hard pulls and card closures can both affect credit, I like to do them at the same time.

I open 2-4 new cards per year for sign up bonuses. I am able to use quarterly tax payments to easily meet any spending threshold needed for sign up bonuses.

We tend to use my credit more often than my husband's. He is not as interested in the credit card game, so he holds most of our Chase cards, as he is almost always under 5/24. My credit is used for all the other cards because I am hardly ever under 5/24.

The only card I keep around that I don't use very much is my Fidelity 2% back card. I have had that card for over 10 years. Other cards pay more than this right now, but the terms on those other cards have also changed at times. Fidelity's 2% card has never changed in the 10+ years I have held it (other than the AmEx to Visa switch a few years ago), so it's the floor for cash back, as far as I am concerned. I charge a few things to it per year to make sure it stays open.
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Re: How do you handle credit cards you no longer use?

Post by hudson »

Broken Man 1999 wrote: Tue Dec 08, 2020 9:06 am If I don't use a credit card, I cancel it. No reason not to do so. In the last year or so I have cancelled four cards, and my credit score today hovers in the 82X range.

I do care about my credit score because insurance companies use the score as part of premium calculations.

Next up to be cancelled is PayPal. Just PayPal accounts, I don't have a PayPal credit card.

Broken Man 1999
I probably need to follow your lead. I have around 10 credit cards or the equivalent. I only use 6 regularly. I wouldn't use so many but I play the points game. I "sock drawer" the rest. My credit also hovers in the OK range. At times it drops, but it bounces back.
I understand that FICO credit reporting isn't that important as long as you pay your bills on time.
I don't plan on borrowing any money ever again...but I do buy auto and home insurance. Therefore I pay attention to my score and I've tried to learn the rules and limits. It's not terrible if you have a credit check or cancel an account and your score drops. Again, the score bounces back.
I decided to keep PayPal because it's convenient; I can use it without sharing my account number.
I have a 47 year old card that I no longer use. I haven't used it in around 3 years; they haven't cancelled me or warned me. I tried to buy an Amazon gift card with it; Amazon wouldn't take it, so I bought something cheap and it worked.

Bottom Line: I realize that I could ignore all of this stuff and be fine. At some point, I'm going to clear out the junk and simplify....but not in 2020.
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Re: How do you handle credit cards you no longer use?

Post by Big Dog »

Personally, I have closed all credit cards. And I had one Visa/MC (USAA bank) that I never used but they sent me a new card every xx years like clockwork. Finally had to call them to cancel.
You may have heard that closing a credit card causes you to “lose credit” for the age of the account. That is mostly a myth.

Credit expert John Ulzheimer, formerly of FICO and Equifax, confirms that closing a credit card will not immediately remove it from your credit reports. “As long as the credit card remains on your report, you will still get the value of the age of the account in both the FICO and VantageScore branding credit scoring models. The only way to lose the value of the age of the card is if it’s removed from your reports,” Ulzheimer adds.
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wander
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Re: How do you handle credit cards you no longer use?

Post by wander »

If you cancel a credit card, remember to write down the date that you cancel it. That was one of the very unexpected questions that got me when I called the credit agency. Who would have cared about the date/year of a cancellation. :oops:
mediahound
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Re: How do you handle credit cards you no longer use?

Post by mediahound »

Question: can you still cancel a credit card if you've frozen your credit? Or, do you have to first unfreeze it?
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AerialWombat
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Re: How do you handle credit cards you no longer use?

Post by AerialWombat »

mediahound wrote: Fri Dec 11, 2020 12:16 pm Question: can you still cancel a credit card if you've frozen your credit? Or, do you have to first unfreeze it?
Do not unfreeze to cancel.
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mediahound
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Re: How do you handle credit cards you no longer use?

Post by mediahound »

AerialWombat wrote: Fri Dec 11, 2020 12:33 pm
mediahound wrote: Fri Dec 11, 2020 12:16 pm Question: can you still cancel a credit card if you've frozen your credit? Or, do you have to first unfreeze it?
Do not unfreeze to cancel.
Thanks.
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Re: How do you handle credit cards you no longer use?

Post by radiowave »

I had a card for two decades on my brick and mortar bank. Hadn't used it in a while then it got abruptly cancelled by the bank last summer, no email or letter. I wasn't happy but my FICO score dropped only 3 points for two cycles then went back up to where is usually is. One less card I have to worry about.
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JaneyLH
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Re: How do you handle credit cards you no longer use?

Post by JaneyLH »

I have several Amex cards I no longer use. I keep them in a drawer.
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1789
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Re: How do you handle credit cards you no longer use?

Post by 1789 »

Cancel it and simplify your life.
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sd323232
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Re: How do you handle credit cards you no longer use?

Post by sd323232 »

Tree Guy wrote: Mon Dec 07, 2020 3:58 pm I don't know if it's still true, but in the past I read that you shouldn't cancel a credit card you no longer use as it may affect your credit. Is it best to use them occasionally even if it's only a minor purchase or just not use them?
affect what, credit score? who cares about credit score lol
UpperNwGuy
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Re: How do you handle credit cards you no longer use?

Post by UpperNwGuy »

I have four credit cards that I rarely use. I keep them in the sock drawer. About every five months I pull them out and use them once each. So far this week I've used three of the four, and tomorrow I'll use the fourth. After that, they'll go back into the sock drawer until May 2021.
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Re: How do you handle credit cards you no longer use?

Post by camillus »

I keep only one card and rotate the rest depending on signup bonuses. I currently have 2 open. Credit score ~800, which is more than you really need. I just opened a HELOC in fact, with no plans to use it, so that should help my "credit utilization" factor quite a bit.
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celia
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Re: How do you handle credit cards you no longer use?

Post by celia »

flyingaway wrote: Mon Dec 07, 2020 4:24 pm Normally, they will send you a letter and tells you that your card has not been used for some time and the account will be closed if you do not use it in 30 days. The problem will be solved.

Or when the old card expires, they will send you a new one. Do not activate the new one.

I did that once, but they kept sending me cards every 3 years. I even wrote them to close my account, but the renewal cards kept coming.

Finally, I wrote and asked them to close it and send me a written confirmation. Done.
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Re: How do you handle credit cards you no longer use?

Post by stvyreb »

tj wrote: Mon Dec 07, 2020 9:26 pm I've had a couple cancelled on me, there was no noticeable effect on my credit score.

I have several cards that I have not used in quite some time.

I occasionally get a letter that they will cancel it if I don't use it, when I do receive that letter, I tend to buy a $5 amazon gift card or something.
I had an ancient one, which was novel "no annual fee forever", ATT Universal, but it had FTF so prefer to just use one for simplicity, and found out the hard way, with no notice given, "we closed your account for non-use".

Seemed pretty lame, considering decades I had had it. Kept it for said longevity to credit score, though, credit isn't as relevant to me as it might once have been..
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Re: How do you handle credit cards you no longer use?

Post by Marseille07 »

sd323232 wrote: Fri Dec 11, 2020 9:47 pm
Tree Guy wrote: Mon Dec 07, 2020 3:58 pm I don't know if it's still true, but in the past I read that you shouldn't cancel a credit card you no longer use as it may affect your credit. Is it best to use them occasionally even if it's only a minor purchase or just not use them?
affect what, credit score? who cares about credit score lol
Lots of people do. Mine isn't low right now but would've been higher hadn't I closed a long-standing card. I don't understand why folks on this thread are casually suggesting to close credit cards. It's a big no-no in my book.
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Re: How do you handle credit cards you no longer use?

Post by matti »

I've opened a lot of cards over the years to get the sign-up bonuses. Once I was done using them, I stopped using them but kept the accounts open (unless they had an annual fee). Presumably, many of those card accounts have since been closed, but since I don't use them, I don't know for sure. I keep the cards on a bookshelf in my house. My credit score is very good, but I'm not sure how/if it is related to my card accounts.
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Re: How do you handle credit cards you no longer use?

Post by Marseille07 »

matti wrote: Sat Dec 12, 2020 1:16 am I've opened a lot of cards over the years to get the sign-up bonuses. Once I was done using them, I stopped using them but kept the accounts open (unless they had an annual fee). Presumably, many of those card accounts have since been closed, but since I don't use them, I don't know for sure. I keep the cards on a bookshelf in my house. My credit score is very good, but I'm not sure how/if it is related to my card accounts.
If you use services like Credit Karma they can tell you exactly which accounts are still open. I think it's OK to close card accounts w/ short credit history. I closed one with long credit history, which impacted me because I essentially lost credit history upon closure. In hindsight this was a mistake on my part.
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