Use Recurring Payments to Keep Old Credit Cards on Your Credit History
Paying off credit cards and paying off debts is a great feeling. But what about old cards? Instead of closing your cards, set up a one-off recurring payment that will be redeemed automatically.
As the personal finance blog MoneyNing explains, closing old credit cards can be a very bad decision. The length of your credit card history, the number of timely payments you made, and the overall utilization of the loan all contribute to an improvement in your credit score. If you close the map completely, everything will disappear. Even worse, if you don’t use your credit card for a long period of time, the bank may close it for you. To maintain a high credit score, set up a single recurring payment that you pay every month:
In our case, we decided to make periodic payments to the husband’s card, which we will repay monthly. This allows us to save all the good work done by him without causing serious inconvenience to ourselves.
Of course, this applies most of all to older cards with a long history. If you have a relatively recent account with very few payments, it’s safer to close it, but it’s still not perfect. Splitting up your credit cards can be a satisfying token victory, but closing all of your accounts can only make life harder for you the next time you need your credit score for something.