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Cancelling Credit Cards: What Would You Do?

Here’s another reader question about canceling credit cards:

I recently paid off the last of my credit card debt so all I owe now is a small student loan and my car payment both of which will be done in less than three years. My wife are in the process of consolidating our accounts and joining our finances and I want to get rid of some excess baggage. I currently have the following cards:

  • American Express Gold (Charge card); Open since 1999.
  • Citibank Mastercard (24k limit); Open since 2006.
  • Chase Mastercard (5.5k limit); Open since 2006.
  • Discover Card (7k limit); Open since 2006.
  • Futuretrust Mastercard (3.5k limit); Opened in 2009

My wife is an authorized user on the Futuretrust card and we use it for all our monthly expenses so that 1% of those goes into our child’s 529 account. What I want to do is get rid of the AMEX card because I’m tired of paying the $125 annual fee and I don’t need the charge card anymore but I’d still like to stay with AMEX. They told me I can’t switch and that I need to apply for a new card and then cancel my Gold Card. I would be okay with this except that with my Gold card being my oldest card by 7 years I’m wondering what that would do to my credit rating. Would AmEx still report my history from 1999 if I did this or would I lose those seven years?

I would also like to get rid of the Chase card as I’m not a big fan of their company and the Discover card since I don’t really use it that often. So ultimately I would end up with the Citi and Futuretrust Mastercard and an AmEx non-charge card. Since I don’t owe anything on any of these accounts, could I do all of this without affecting my score of around 748 significantly? My wife are wanting to buy a house but it probably wouldn’t be for another couple of years or so and we won’t be buying any cars for quite a while either.

I can understand why this reader wants to pare down his credit cards and cancel the AMEX Gold Card when it carries a high annual fee and provides rewards that you can get for free. The only trouble spot I see is that it’s by far his oldest card account.

While closing the Gold Card wouldn’t erase the history of payments he made on time, it would make his oldest open account only three years old instead of ten years old, which will most likely lower his credit score. That said, since he already has a good credit score and doesn’t plan to get a loan for a few years, I don’t see a reason not to do it.

What would you do?

Published or updated on May 7, 2009

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About David Weliver

David Weliver is the founding editor of Money Under 30. He's a cited authority on personal finance and the unique money issues we face during our first two decades as adults. He lives in Maine with his wife and two children.


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  1. Nick says:

    I agree with the first two posts. Keep the AMEX until after you have a house. $125 x 2 years for an annual fee before you get a house…You’ll probably end up saving more money with the lower interest rate you (might) get vs. the money you’d save by cancelling that card now. The higher your credit rating, the lower your interest rate, so keep it until you get the house. If you cancel it now, it will certainly lower your credit score. The day you get the house, cancel everything you don’t want.

  2. SK says:

    I agree with Donnie, if he is going to buy a house within the next year or two, it would be better to keep the cards until after the house purchase. Having the longer credit history and higher credit limit should help with the house purchase.
    I would concentrate on paying off the car/student loan in addition to any debt that the wife might have. At the same time don’t forget to save for the 10-20% down payment on the house.

  3. Donnie says:

    If I was him, I would wait until I bought the house and then cancel everything I didn’t want.

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