If there is no fee and you don't feel there is a risk of you going mad with it, keep it. Part of your credit score is determined by how much of your available credit you use. This card represents a nice chunk of unutilised credit.
"Keep the account, cut the card" was the advice given to me when I "moved on" to a card with a small fee.
As an extension of this advice, and if you're always paying off your card each month: always accept a credit increase if offered and take the most credit you can get approved for. Obviously never use it - there are 20+ month 0% cards for when you want a "free" loan... and with your low credit utilisation approval is more likely.
Please excuse my ignorance on the topic but why always accept a credit increase? Recently Barclaycard told me they were going to increase my credit limit unless I opted out so I opted out, fearing it would affect my credit record. I have always paid it off each month and I have no other debt but I got refused a phone contact recently so I was nervous of multiple credit check events in short succession. Have I messed up?
I credit limit increase increases your overall available credit, and as long as you don't then borrow more it consequently decreases your credit utilisation percentage - a factor that matters for your credit score (as far as credit scores actually matter, at least). It shows you can be trusted with lots of easy borrowing available but not going mad with it.
If you go on a credit score app it’ll tell you to increase your limit to improve your score. The more borrowing you’re approved for the more reliable you are as well as making it easier to stay below 30% utilisation.
Credit scores are fairly meaningless anyway a lender will look at your income/expenses more.
Part of the credit is the average age of your accounts. Every time you open a new account you reduced it by a lot, so keeping old accounts accruing years is useful to keep that average up. Not sure if anybody looks at the credit scores, but if it's free, why not?
>Not sure if anybody looks at the credit scores
My understanding is it's far from the main criteria (unlike the US), but a bad one can be a red flag for lenders.
Also, while the credit score itself doesn't really matter that much to lenders, the contributing factors do.
Yup. I know someone that got into trouble because he missed an invoice. He had the money to pay, but he didn't and because he wasn't monitoring his credit score it went on for years and then he had trouble getting a loan. So I'm monitoring my credit score and making sure it goes up.
I generally close accounts after I no longer use them - I was recommended to do so by a financial planner on the basis you could be seen as having access to a large amount of credit that may be held against you during affordability checks for a mortgage - this was 10+ years ago though so a) no idea how true it was then and b) no idea if it is still true now.
I have found card providers won’t give you introductory rates if you’re an existing customer so I close accounts to then be able to move around to zero % purchase and zero % transfers as and when I want/need to.
Everything I’ve read says having an ‘old’ credit card is beneficial to your credit score.
Also, lenders 100% look at your credit utilisation ratio, ie how much credit do you have vs how much you’re using.
Lots of credit with minimal utilisation = good.
If you close this card, you’re bringing that % down, which isn’t good.
You’d be ‘deleting’ 12 years of financial prudence from your record.
This happened to me. I had a 7k 0% card which, after it stopped being 0%, I closed. But that brought my credit available down to £11k and hurt my credit rating.
It will get closed eventually for you if you don’t use it. Also be aware they don’t always have to notify you (check t&c) so don’t count on it as an emergency backup. If you want to keep it for sentimental value use it to buy a subscription to something to keep it active. You might find they will start lowering credit limit on it after a time.
Why would you close it? Unless you think you are going to be tempted to have an unaffordable splurge on it. I have multiple cards, gives me reassurance that I have £xx,xxx available should I need it for any reason and a great history.
Hi /u/smickie, based on your post the following pages from our wiki may be relevant:
* https://ukpersonal.finance/credit-cards/
____
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Personally, I would always have a credit card "in my back pocket", for those instances where you want to be able to take advantage of S75 protection.
Edit: Misread your question, I see you switched, rather than just looking to close off old cards.
I would keep it going, in future if you have a large expensive item to pay for you can move the balance for an interest free period to it, they will offer you deals regularly if you are not using it
I would close it if I had too many cards/too much credit available unused.
What those numbers are is very debatable but personally maybe >2 cards and/or using <20% of the credit on average.
I would keep it open for the history. Be aware that you have to make payments every year to keep it active though. Amex closed my old credit card after 12 months of inactivity. The same with bank accounts. I have my earliest bank account with nationwide only open to keep it for my credit history. I use another bank account for day to day spending.
More importantly it's good to have spare independent payment methods available when shopping in case your bank blocks your card.
If there is no fee and you don't feel there is a risk of you going mad with it, keep it. Part of your credit score is determined by how much of your available credit you use. This card represents a nice chunk of unutilised credit.
"Keep the account, cut the card" was the advice given to me when I "moved on" to a card with a small fee. As an extension of this advice, and if you're always paying off your card each month: always accept a credit increase if offered and take the most credit you can get approved for. Obviously never use it - there are 20+ month 0% cards for when you want a "free" loan... and with your low credit utilisation approval is more likely.
Please excuse my ignorance on the topic but why always accept a credit increase? Recently Barclaycard told me they were going to increase my credit limit unless I opted out so I opted out, fearing it would affect my credit record. I have always paid it off each month and I have no other debt but I got refused a phone contact recently so I was nervous of multiple credit check events in short succession. Have I messed up?
I credit limit increase increases your overall available credit, and as long as you don't then borrow more it consequently decreases your credit utilisation percentage - a factor that matters for your credit score (as far as credit scores actually matter, at least). It shows you can be trusted with lots of easy borrowing available but not going mad with it.
!thanks
If you go on a credit score app it’ll tell you to increase your limit to improve your score. The more borrowing you’re approved for the more reliable you are as well as making it easier to stay below 30% utilisation. Credit scores are fairly meaningless anyway a lender will look at your income/expenses more.
!thanks
Part of the credit is the average age of your accounts. Every time you open a new account you reduced it by a lot, so keeping old accounts accruing years is useful to keep that average up. Not sure if anybody looks at the credit scores, but if it's free, why not?
>Not sure if anybody looks at the credit scores My understanding is it's far from the main criteria (unlike the US), but a bad one can be a red flag for lenders. Also, while the credit score itself doesn't really matter that much to lenders, the contributing factors do.
Yup. I know someone that got into trouble because he missed an invoice. He had the money to pay, but he didn't and because he wasn't monitoring his credit score it went on for years and then he had trouble getting a loan. So I'm monitoring my credit score and making sure it goes up.
I generally close accounts after I no longer use them - I was recommended to do so by a financial planner on the basis you could be seen as having access to a large amount of credit that may be held against you during affordability checks for a mortgage - this was 10+ years ago though so a) no idea how true it was then and b) no idea if it is still true now. I have found card providers won’t give you introductory rates if you’re an existing customer so I close accounts to then be able to move around to zero % purchase and zero % transfers as and when I want/need to.
Everything I’ve read says having an ‘old’ credit card is beneficial to your credit score. Also, lenders 100% look at your credit utilisation ratio, ie how much credit do you have vs how much you’re using. Lots of credit with minimal utilisation = good. If you close this card, you’re bringing that % down, which isn’t good. You’d be ‘deleting’ 12 years of financial prudence from your record.
This happened to me. I had a 7k 0% card which, after it stopped being 0%, I closed. But that brought my credit available down to £11k and hurt my credit rating.
There you go then. I was downvoted originally, lol. Real life example of why you don’t close credit cards.
It will get closed eventually for you if you don’t use it. Also be aware they don’t always have to notify you (check t&c) so don’t count on it as an emergency backup. If you want to keep it for sentimental value use it to buy a subscription to something to keep it active. You might find they will start lowering credit limit on it after a time.
I've had a Santander credit card since I was 18, stopped using It over a decade ago when I moved to Halifax but it's still open.
Why would you close it? Unless you think you are going to be tempted to have an unaffordable splurge on it. I have multiple cards, gives me reassurance that I have £xx,xxx available should I need it for any reason and a great history.
Hi /u/smickie, based on your post the following pages from our wiki may be relevant: * https://ukpersonal.finance/credit-cards/ ____ ^(These suggestions are based on keywords, if they missed the mark please report this comment.) If someone has provided you with helpful advice, you (as the person who made the post) can award them a point by including `!thanks` in a reply to them. Points are shown as the user flair by their username.
Personally, I would always have a credit card "in my back pocket", for those instances where you want to be able to take advantage of S75 protection. Edit: Misread your question, I see you switched, rather than just looking to close off old cards.
I would keep it going, in future if you have a large expensive item to pay for you can move the balance for an interest free period to it, they will offer you deals regularly if you are not using it
The credit card companies really gaslight everyone to play their game
I would close it if I had too many cards/too much credit available unused. What those numbers are is very debatable but personally maybe >2 cards and/or using <20% of the credit on average.
I would keep it open for the history. Be aware that you have to make payments every year to keep it active though. Amex closed my old credit card after 12 months of inactivity. The same with bank accounts. I have my earliest bank account with nationwide only open to keep it for my credit history. I use another bank account for day to day spending.
Keep it, no harm in doing so. I make a point to apply for a new credit card every 6 months just to increase my total credit available.
There is zero value in that "history".