Should you Cancel unused Credit Cards or Keep Them? Anybody that is having more than one credit card and also has a particular credit card that he or she does not regularly make use of faces this question.

Should you Cancel unused Credit Cards or Keep Them?

The question of whether you should cancel unused credit cards or keep them is one question that people will always keep asking. However, the answer to this question is relatively simple and we are going to be answering it in this article.

Should you Cancel unused Credit Cards or Keep Them?

In the general sense of it, it is in your best interest to still keep unused credit cards and not cancel them. Keeping your unused credit card open will benefit you in the long run in terms of your credit history and credit score. The one credit card you have and use responsibly has a positive impact on your credit history and credit score.

When you cancel a credit card, there is a direct hit on your credit score and history at the same time. Even if the effect takes a long time to be felt, cancelling a credit card will reflect on your credit report for up to 10 years. which is a major red flag to lenders and other financial institutions.

How will cancelling your Unused Credit Card affect your Credit Score?

The cancellation of a credit card is certainly going to impact your credit score, even if it is not right away. As I mentioned before, when you cancel a credit card, it will stay on your credit report for up to 10 years, which is a red flag to financial institutions. What you need to know is that this also affects your average age of the account and your total credit limit with definitely decrease. If this factor decreases, your credit score goes down.

Another area where cancelling your credit card without you is the area of your utilisation ratio, which constitutes 30% of your credit score. If you have a higher credit utilization ratio, you have a lower credit score. Finally, closing a credit card account can simply lead to a mix of credit falling below normal. Your credit score is basically determined by all these factors.

How many Credit Cards are too many?

While it is very important and beneficial to your credit score and history for you not to cancel a credit card, you can’t simply keep every single credit card you have. Then the question arises: how many credit cards are too many? There is no such thing as too many credit cards. This is because the number of credit cards you need is directly dependent on your financial circumstances.

If you need more credit cards, you should definitely get more. However, if you are not responsible for using them, then you should definitely cancel some. Having different cards is also a huge benefit because the various cards are made for various purposes and payments. The only downside is that having many credit cards will lead to the temptation to spend beyond what you can pay back.

When can I cancel an unused Credit Card?

The fact that having more than one credit card account open is a good thing for your credit score doesn’t mean you should do so. This is because no matter how beneficial it is, there are certain times that you need to just cancel some of the unused credit card accounts and not keep them.

One such situation is if you are an overspender. If you are out to overspend, then it is not good to have an extra credit card lying around so that you do not spend more than what you can pay back. Also, if you have a newer and better card with more benefits, then you can simply cancel an unused credit card and not keep it. Finally, if you have another card with no annual fee, you can decide to cancel your unused card.

What do you do with an Unused Credit Card?

If you decide to keep your unused credit card so that it can help you keep on building your credit history and score, there are certain things you need to do. First of all, so that you never forget that you have an unused card, you should simply make it your recurring payment go-to card. You can see me set it up to pay your streaming service subscriptions and all the bills.

If you have a good credit history, you can also contact your credit card company to simply reduce the charges on the card. Finally, you need to set up monthly reminders to make payments with the card just as we have listed above.

How to Cancel an Unused Credit Card

Cancelling an unused credit card is easy. All you have to do is simply follow the below procedure:

  • First of all, you need to pay off all the balances that are left on your card.
  • If you have any automatic payment leads on your card, simply change them to your newer card.
  • Redeem my reward that is left to be redeemed from your card.
  • Contact your card issuer with your request to cancel your credit card.
  • Finally, destroy the credit card by cutting it into pieces with scissors.

If you followed this process correctly, you would have successfully cancelled your unused credit card.


Is it okay to close an unused credit card?

If you have the habit of overspending, then it is definitely okay for you to close any unused credit cards that you have. Anybody that does not have an excessive spending habit can simply keep unused credit cards because they are very beneficial to building your credit score. Also, closing an unused credit card will simply affect your credit score negatively, but not immediately.

Does closing an unused credit card affect your credit score?

The answer is a very big yes. Closing and unused credit cards affect your credit score, but it is not an immediate effect. It takes time to properly feel the effects of counselling or closing an unused credit card.


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