Hi Money Minder,
I’ve had a basic company credit card for a while now and managed to raise my credit to 730. I just upgraded to a better credit card with a different company and I’m wondering if closing the old one will hurt my credit score. Should I leave it with a zero balance indefinitely? I prefer using just one credit card because I like keeping things simple. Being young, I’m a bit clueless about how all of this works.
Thanks for your help!
Response from THE MONEY MINDER:
Hello There,
Congratulations on getting your credit score up to an impressive 730! It’s definitely a good sign that you are mindful of your finances and looking to make informed decisions. When considering whether to close your old entry-level company credit card or keep it open, there are a few factors to consider.
Closing a credit card account can impact your credit score, especially if it’s one of your oldest accounts. If you’ve had this card for a couple of years and it has contributed positively to your credit history, closing it may slightly lower your credit score. However, if the card has an annual fee or you find it difficult to manage multiple cards, it might be better to close it.
On the other hand, if the old card has no annual fees and you can keep it open without incurring any costs, it may be beneficial to leave it open with a zero balance. Having an additional credit line with a long history can help boost your credit score over time.
Ultimately, it’s essential to weigh the pros and cons based on your specific situation. If you’re confident in your ability to manage one credit card responsibly, closing the old one should not have a significant negative impact on your credit score. Just make sure to continue making on-time payments and keeping your credit utilization low on your new card.
Remember, responsible credit card usage is key to maintaining a healthy credit score. All the best from THE MONEY MINDER.
