Should I cancel a few of my credit cards

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Money_Badger
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Should I cancel a few of my credit cards

Post by Money_Badger »

I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.

I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
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lthenderson
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Re: Should I cancel a few of my credit cards

Post by lthenderson »

The thought of seven statements to look through every month would make my head hurt. We just have two cards, one we use everyday and the other we keep for when the everyday card has a stop on it for fraudulent use, so we can still go about our lives. We put a premium on simplicity. Others put a premium on getting every penny out of the system they can. Only you can decide where you fall on that spectrum.
iamblessed
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Re: Should I cancel a few of my credit cards

Post by iamblessed »

lthenderson wrote: Mon Jan 10, 2022 11:08 am The thought of seven statements to look through every month would make my head hurt. We just have two cards, one we use everyday and the other we keep for when the everyday card has a stop on it for fraudulent use, so we can still go about our lives. We put a premium on simplicity. Others put a premium on getting every penny out of the system they can. Only you can decide where you fall on that spectrum.
Me too.
LeftCoastIV
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Re: Should I cancel a few of my credit cards

Post by LeftCoastIV »

That’s a lot of cards. My understanding is that your credit score takes into account (among other things):

Credit utilization: defined as balances divided by overall credit limit

Length of credit history: older cards are more valuable for your credit score

You could optimize by cancelling newer, low limit cards.

I would also set up alerts for all these cards (text, email, etc) to help keep track of potential fraud
iamblessed
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Re: Should I cancel a few of my credit cards

Post by iamblessed »

I have two 2% cash back cards and called it a day. I think you should to. I love simple. I use to have 8 cards at one time.
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Re: Should I cancel a few of my credit cards

Post by iamblessed »

I just helped a family member close four cards. The score dropped 22 points and was back up in about six months. No big deal.
Last edited by iamblessed on Mon Jan 10, 2022 5:05 pm, edited 1 time in total.
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willthrill81
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Re: Should I cancel a few of my credit cards

Post by willthrill81 »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?
Yes, you should cancel several of those. If you're using any of them, even as a monthly payment system as you likely should, cancelling some will increase your credit utilization ratio a bit, but the effect is small. Our credit scores have been well over 800 for years, and even when we cancel a card that we've churned for bonuses, our scores will only fall about 5 points for a few months. Don't worry about such things. Simplify your life.
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mptfan
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Re: Should I cancel a few of my credit cards

Post by mptfan »

Yes, you should cancel some of your cards, keeping track of seven cards and seven statements and seven online accounts would be way too much for me, not to mention the possibility of fraud. My sweet spot between simplicity and maximization of benefits is three credit cards.
conservativeinvestor
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Re: Should I cancel a few of my credit cards

Post by conservativeinvestor »

I would definitely cancel the ones that you list with the yearly fees.

I have two credit cards and a debit card. I have one card that give me cash back rewards on every purchase for no annual fee. I have opened and closed different accounts at different times due to better cash back rewards but when i open a new one i close the old one. The second credit card is only kept open because it had been open for so long, i use it once or twice a year to keep it open for the credit history length.

The debit card is used only at the atm.
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Re: Should I cancel a few of my credit cards

Post by Independent George »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.

I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
Don't keep a credit card just for the credit score. Yes, a lower percentage of revolving credit in use increases your score, but only by a miniscule amount compared to other factors. Your history of timely payments, and the length of your credit history are the biggest (and you have no control over the latter).

Everybody has a different credit card rewards strategy here, but the general consensus is to reduce the number of cards and focus on rewards for the types of transactions you generally use the most. I'd much rather have $200 in rewards on a single card than ten different cards with $25 in rewards at each. If you have a large family and find yourself at Costco every week, then a Costco card may be very efficient for you. If you take clients out for dinner a lot, then there's an Amex that pays more at restaurants.

Do you use the airlines enough that the rewards are greater than the annual fees? At the very least, you might try calling the card company to have it waived - the worst they can do is say no. Unless you fly a LOT, it's generally more efficient to keep only a single airline card and stack miles/upgrades on it than it is to keep multiple cards and save a few bucks here & there on individual flights.

I'm down to three cards, and have considered dropping the last one:

1. Citi 2% cashback card
2. Chase Amazon Prime card (5% at Amazon & Whole Foods, plus additional prime day rewards).
3. Chase Freedom card (5% in revolving rewards categories)
Broken Man 1999
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Re: Should I cancel a few of my credit cards

Post by Broken Man 1999 »

OP wrote:

"....BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit..."

If you don't use the BofA Preferred Rewards card for anything except dining out, you could get rid of it, since your Citi Costco card also has 3% rewards for dining out.

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RobLyons
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Re: Should I cancel a few of my credit cards

Post by RobLyons »

I was big into getting the best credit possible before I bought a house (myFico is a good website) and what I learned is it hurts your credit temporarily. I currently have about 8 or 9 cards and there's no need to look through statements. I have auto pay on them all and use most of them once in a while, with 2 being my main cards. I have 1 for gas (5% cash back), 1 for groceries (6% cash back) then my every day capital one 1.5% cash back and then others with quarterly rotating perks and also I opened one for an intro offer of 18 months at 0%. I also have a couple debit cards. It doesn't hurt to leave them open.
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DSInvestor
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Re: Should I cancel a few of my credit cards

Post by DSInvestor »

I agree with others to focus on the transactions that you do most and keep the cards that work well for those.

Citi Costco card is great for gas (4%), dining and travel (3%), Costco and costco.com (2%), everything else (1%), no foreign transaction fee. If you are OK with annual redemption of reward, you could ditch the BofA cards and eliminate a login as well.

If you use your cards outside of the US, make sure you keep at least one card that does not charge a foreign transaction fee.
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sc173
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Re: Should I cancel a few of my credit cards

Post by sc173 »

Independent George wrote: Mon Jan 10, 2022 11:43 am
Money_Badger wrote: Mon Jan 10, 2022 11:04 am I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.

I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
Don't keep a credit card just for the credit score. Yes, a lower percentage of revolving credit in use increases your score, but only by a miniscule amount compared to other factors. Your history of timely payments, and the length of your credit history are the biggest (and you have no control over the latter).

Everybody has a different credit card rewards strategy here, but the general consensus is to reduce the number of cards and focus on rewards for the types of transactions you generally use the most. I'd much rather have $200 in rewards on a single card than ten different cards with $25 in rewards at each. If you have a large family and find yourself at Costco every week, then a Costco card may be very efficient for you. If you take clients out for dinner a lot, then there's an Amex that pays more at restaurants.

Do you use the airlines enough that the rewards are greater than the annual fees? At the very least, you might try calling the card company to have it waived - the worst they can do is say no. Unless you fly a LOT, it's generally more efficient to keep only a single airline card and stack miles/upgrades on it than it is to keep multiple cards and save a few bucks here & there on individual flights.

I'm down to three cards, and have considered dropping the last one:

1. Citi 2% cashback card
2. Chase Amazon Prime card (5% at Amazon & Whole Foods, plus additional prime day rewards).
3. Chase Freedom card (5% in revolving rewards categories)
In the event you do cancel #3, you can ask Chase beforehand to move all but $500 of the credit limit from it to your other card with them. Even if you don't need it, it will help your utilization score.
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jeffyscott
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Re: Should I cancel a few of my credit cards

Post by jeffyscott »

I get a lot of cards for sign up bonuses and only cancel the cards that have annual fees. Why bother canceling no fee cards, just stop using the ones that don't make sense to use. Unless you are worried about giving yourself access to too much credit, due to your apparent past issues with credit card debt.

I've got about 15 or so open accounts and about the same number of closed accounts, according to credit karma. We use maybe 3-4 cards in any month. There's no statements to review for cards that are not used.
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Apathizer
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Re: Should I cancel a few of my credit cards

Post by Apathizer »

As others have said, pick the 1-2 cards with the best terms and cancel the rest. Like someone else I have two: one for regular use and another in case there's an issue with my primary card. That's enough. To me there's no reason to have so many CCs.
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mptfan
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Re: Should I cancel a few of my credit cards

Post by mptfan »

RobLyons wrote: Mon Jan 10, 2022 12:07 pmI currently have about 8 or 9 cards and there's no need to look through statements.
How do you know if there are any unauthorized charges?
humblecoder
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Re: Should I cancel a few of my credit cards

Post by humblecoder »

Since the majority of respondents are telling you to "close 'em", I am going to play devil's advocate and make the case for having multiple credit cards.

Personally, I currently have TEN credit cards opened. However, I try to make sure that every card has a purpose. Here is what I have

BoA Premium Rewards: This is my default card. Since I am Platinum Honors member (>$100K in BoA + Merrill Edge), I get 2.625% cash back on all purchases. This also gives 3.5% back on travel and dining if you are a Platinum Honors member. This card has an annual fee, but I have made up for it by using the TSA Pre-check credit and the travel credit.

BoA Cash Rewards: This gives 5.25% back in a select category, as well as 3.5% back on groceries + warehouse stores. Again, I get the higher cash back being a Platinum Honors member

Chase Amazon: 5% back on Amazon purchases

Target RED Card: 5% back on Target purchases

Discover: 5% back in rotating categories

Chase Freedom: 5% back in rotating categories

Chase Sapphire: I got this for the large signup bonus which I used for 3 plane tickets already, and I still have many points to burn. Also, this card gives primary rental insurance coverage. This card has an annual fee, but the signup bonus more than made up for it.

Hilton Amex: Bonus points when charging a stay at a Hilton property + automatic gold status. Not as useful since 2020. In normal years, I get more value out of it than what I pay in the annual fee, but not so much anymore.

Fidelity Visa: This used to be my default card since it gives 2% cash back, but it has been superseded by the BoA Premium Rewards. I am keeping it for now because occasionally Fidelity gives a special bonus offer for extra cash back

USAA Visa: I rarely use this. It used to be my card for gas purchases (3% back) but awhile back they converted it to a flat 1.5% cash back card.

I am toying with getting rid of the last three since they no longer serve as big a purpose, but the others I am keeping for now.

With my level of purchases, I am usually able to net about $2000+ per year with my system. At some point I might feel like simplifying it, but that moment is not today :-). I know my wife is a "one card" person... nothing wrong with that either. I freely admit that my system isn't for everyone and there is nothing wrong with that. I won't take offense. I am just providing another perspective for the OP to chew on.

People have mentioned how hard it must be to manage transactions on all of these cards. However, I use a popular financial aggregator* site which allows me to see all of my transactions in one place. In addition, I set up various fraud alerts (ex: notify me of a transaction greater than $X) as an additional check. Finally, I have a system for auto bill pay so I never miss any payments.

* - I know that some people have an issue with giving their information to financial aggregators. For me the risk is worth the reward, but I know others come to a different conclusion, which is fine too. To each her own.
toast0
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Re: Should I cancel a few of my credit cards

Post by toast0 »

lthenderson wrote: Mon Jan 10, 2022 11:08 am The thought of seven statements to look through every month would make my head hurt. We just have two cards, one we use everyday and the other we keep for when the everyday card has a stop on it for fraudulent use, so we can still go about our lives. We put a premium on simplicity. Others put a premium on getting every penny out of the system they can. Only you can decide where you fall on that spectrum.
I've got a fair number of cards, and keeping track of all the statements is easy, because I have one card that I make most of the purchases on, one card that I need to make 10 purchases a month on (which I do through small subscriptions, generally) and the rest almost always have only a handful of transactions a year, so most months don't generate statements.
Stoic9
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Re: Should I cancel a few of my credit cards

Post by Stoic9 »

My FIL died 2 weeks ago. His daughter (wifeiod) is his executor. He 'chased' (pun intended) credit card give a ways. She is on week two of checking each for balances/credits and closing them out. Last week she said when this is over we are closing all but 2 of ours, we are not putting our child through this.
tj
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Re: Should I cancel a few of my credit cards

Post by tj »

I never cancel a card unless they stop approving me for new bonuses and my credit limits are too high.

I must have 20 or 30 open cards.
Last edited by tj on Mon Jan 10, 2022 3:06 pm, edited 1 time in total.
Gardener
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Re: Should I cancel a few of my credit cards

Post by Gardener »

lthenderson wrote: Mon Jan 10, 2022 11:08 am The thought of seven statements to look through every month would make my head hurt. We just have two cards, one we use everyday and the other we keep for when the everyday card has a stop on it for fraudulent use, so we can still go about our lives. We put a premium on simplicity. Others put a premium on getting every penny out of the system they can. Only you can decide where you fall on that spectrum.
Thank you for summing up perfectly what I have always believed but could not articulate that well.

My father always tells me I'm leaving a lot of money on the table by not having credit cards and getting points, flights, etc. I would always tell him, I'm just a little more relaxed not worrying about that stuff. In time, those extra cash rewards, flights is not going to make or break me financially.
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anon_investor
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Re: Should I cancel a few of my credit cards

Post by anon_investor »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.

I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
Between my and my spouse we have more than double the number of cards you have. Thoughout the year we find legitiate reasons to use each and everyone of our cards, whether it is some promotion or the card gets 5% cash back at a particular store (e.g. Chase Amazon Prime Visa, Target Red Card, etc.) or catagory (e.g. Discover Card, Chase Freedom, etc.). One thing that does make it easier for us is that several of our cards are under one login, e.g. multipe Chase cards and multiple Bank of America cards.

We have a lot of different credit cards because we try to maximize the rewards/cash back we can earn. We have a large family and only our mortgage payment cannot be charged via credit card, so we have a lot of annual credit card spend and can earn a ton of points/cash back. While it won't make or break us, why turn down thousands of free dollars a year? I usually use that "extra money" to buy more equities. We are disciplined spenders, we used credit cards as a tool, and avoid over spending.

We do not chase credit card bonuses, we only open credit cards that we think we will legitimately use. My spouse and I each have very high credit scores (e.g. 820+) and pay all our balances off each month, our only debt is our mortgage. If you cancel some credit cards it may hurt your credit score at least in the short term. If you plan to apply for a new credit card or loan (mortgage, etc.) in the near future, hold off on closing any credit cards.

I make sure to check my credit card accounts at least once a month just to make sure there are no fraudulent charges, though I often check it weekly. I also have all my cards set up to send me either a text or email every time there is a transaction. In general we do track 100% of our spending, so it is pretty easy to spot fraudulent transactions, we have been hit with them occationally over the years. We just report them and get new cards issued, update any accounts with autopay, etc. not the end of the world.
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anon_investor
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Re: Should I cancel a few of my credit cards

Post by anon_investor »

Stoic9 wrote: Mon Jan 10, 2022 2:16 pm My FIL died 2 weeks ago. His daughter (wifeiod) is his executor. He 'chased' (pun intended) credit card give a ways. She is on week two of checking each for balances/credits and closing them out. Last week she said when this is over we are closing all but 2 of ours, we are not putting our child through this.
My parents LOVE to change credit card bonuses, they actually got me and my sibling into it when we started working... they also gave us the gift of great credit buy having us as Authorized Users on their credit cards when we were in high school/college. I don't want to know how many credit cards my parents have...
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tetractys
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Re: Should I cancel a few of my credit cards

Post by tetractys »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?
If your worried about your credit score you could lock the cards and stash them away until they expire. Cancelling cards can effect your credit score negligibly. You could ask customer service about the effects and best strategy and decide from there.
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Re: Should I cancel a few of my credit cards

Post by RudyS »

DSInvestor wrote: Mon Jan 10, 2022 12:15 pm I agree with others to focus on the transactions that you do most and keep the cards that work well for those.

Citi Costco card is great for gas (4%), dining and travel (3%), Costco and costco.com (2%), everything else (1%), no foreign transaction fee. If you are OK with annual redemption of reward, you could ditch the BofA cards and eliminate a login as well.

If you use your cards outside of the US, make sure you keep at least one card that does not charge a foreign transaction fee.
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Starfish
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Re: Should I cancel a few of my credit cards

Post by Starfish »

Increasing the credit utilization ratio will hurt your credit score.
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Re: Should I cancel a few of my credit cards

Post by SmileyFace »

mptfan wrote: Mon Jan 10, 2022 1:14 pm
RobLyons wrote: Mon Jan 10, 2022 12:07 pmI currently have about 8 or 9 cards and there's no need to look through statements.
How do you know if there are any unauthorized charges?
In my case I get alerts for the cards I don't regularly use so know if they happen to get used. There is no "monthly statement" on cards with no charges.
I have a BAC, CapOne, Citi, Chase*2, ELAN, and Discover.
Seven cards but only use 2 regularly. Sometimes I add 2 or 3 additional for signup points then cancel those in 3 or 4 months.

OP: I would cancel the ones with yearly fees if they aren't worth the points/benefits to you. It doesn't hurt to leave others open.
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Re: Should I cancel a few of my credit cards

Post by JackoC »

LeftCoastIV wrote: Mon Jan 10, 2022 11:11 am That’s a lot of cards. My understanding is that your credit score takes into account (among other things):

Credit utilization: defined as balances divided by overall credit limit

Length of credit history: older cards are more valuable for your credit score

You could optimize by cancelling newer, low limit cards.

I would also set up alerts for all these cards (text, email, etc) to help keep track of potential fraud
The bolded and someone else's comment about first ditching cards with annual fees (if they are anything other than your main card earnings lots of miles/cashback on necessary things) would be key to prioritizing which cards to get rid of IMO. And you need some minimum amount of line. I don't worry about fraud on credit cards in normal modern situation where you set up alerts. It's their money at risk, unless you're really negligent in paying suspicious charges.

We have 16 credit cards that are still open AFAIK. That's the product of two things:
a) high emphasis on getting maximum cash back, have progressed to cards with higher cash back, including for example BOA CCR cards at up to 5.25% but limited to $2.5k/qtr per card so we have 4 different ones.
b) bonus chasing
And that's in the context of not cancelling older than average cards, not considering CC fraud to be a serious risk to *my* money and only actually cancelling cards I got just for a bonus if there's an annual fee the second year. If it's a no fee card I got just for bonus I simply stop using it.

Three big personal factors in number of cards would be time and patience for bonus chasing, spending level and any history of running up CC debt one later decided was not in their best interest. I now have time to bonus chase, years ago it wouldn't have been worth my time. Years ago our spending level was much lower so optimizing cash back wasn't a lot of money*. We've never had any CC debt (past payment due date, credit bureaus count past statement closing date) except on 0% APR offers when there was enough juice in bank accounts to make that worthwhile.

*I think we had a CC 30 yrs ago, very unlikely more than 2 but I can't remember and made the mistake of cancelling whatever cards we had back then at some later date, the oldest one now is less than 20 yrs old.
Last edited by JackoC on Mon Jan 10, 2022 3:59 pm, edited 1 time in total.
lgerla
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Re: Should I cancel a few of my credit cards

Post by lgerla »

I have 10 cards and a plan to cancel ones I don't use/need any more

I cancelled my oldest card last year when my second oldest card passed the 12 year point. It was a low credit limit and didn't make a blip on my report.

Now I have a calendar minder to cancel the current oldest card when the next card gets to the 10 or maybe 12-year point. This card I also don't use any more and only has a $3,000 limit.

I use the other 8 cards for various rewards and cash back that suit me for now. I might close one or two more recent cards this year if I don't use them.

My dh is not concerned (only uses 2 cards) because I keep the list updated in our "OK, I'm dead" file.
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Re: Should I cancel a few of my credit cards

Post by dm200 »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.
I have about 6 or 7. I would not close any because your credit score might go down if you do.
I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
UpperNwGuy
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Re: Should I cancel a few of my credit cards

Post by UpperNwGuy »

There's nothing wrong with having a lot of cards. But if you do, here are two easy ways to protect yourself:

1. Set up email notifications for any charge made against any card. I caught some fraudulent use within 15 minutes because of those email alerts. (I would have caught it even sooner if I hadn't been taking an afternoon nap!)

2. Freeze the cards you are not regularly using so they cannot be used until you unfreeze them. I keep three or four cards in my wallet each month, and the rest are frozen.
afan
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Re: Should I cancel a few of my credit cards

Post by afan »

You can reduce the impact on your credit score by
keeping your oldest cards, even if you do not use them
transferring the credit limits within the same company so that your overall credit limit does not decrease. You will be able to maintain your current spending on the cards without increasing your utilization percent.
Some say that companies will cancel cards that you do not use and that this is a worse mark on your credit that cancelling the cards would have been. I do not know whether it is true, but you might look into it as you decide.

We have a minimum of cards with only 2 that we use routinely. A third that is our oldest, so we will probably keep it forever- no fee.
Beyond that, we are not willing to keep unfreezing credit reports to apply for new cards and cannot see a benefit to holding a bunch of credit accounts we don't use.
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deltaneutral83
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Re: Should I cancel a few of my credit cards

Post by deltaneutral83 »

Many myths about credit cards and how they affect credit score. I would do a full cavity search online other places. Having one credit card and utilizing half the credit line each month is bad. The idea is to have a total credit line that you never exceed 20% of the util and that you ALSO don't exceed 20% of any individual credit line as well. Years ago I was never above 20% on the total and would often times get dinged 40 points from 800ish to 760 and the reason was because one of my credit cards had a limit of $2k that I made a large purchase on (like $1200) which was well over 50% of the individual credit line and got dinged good. So you want to steer clear of both total util AND individual card util at all times. This is why cards with smaller limits <$5k can be problematic for those young and just starting out. Also want to keep your card with the longest history open if you can even if you don't use it unless it has a high AF, keeps your history longer which is a factor in score.
260chrisb
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Re: Should I cancel a few of my credit cards

Post by 260chrisb »

iamblessed wrote: Mon Jan 10, 2022 11:10 am
lthenderson wrote: Mon Jan 10, 2022 11:08 am The thought of seven statements to look through every month would make my head hurt. We just have two cards, one we use everyday and the other we keep for when the everyday card has a stop on it for fraudulent use, so we can still go about our lives. We put a premium on simplicity. Others put a premium on getting every penny out of the system they can. Only you can decide where you fall on that spectrum.
Me too.
Yep me too! Seems like a lot of work to chase the CC rewards and makes me wonder if that's how you got into the hole you dug yourself out of in the first place. I see no need personally for more than a couple cards and couldn't care less what my credit score is or how it would be affected by canceling 4-5 of them.
quantAndHold
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Re: Should I cancel a few of my credit cards

Post by quantAndHold »

I agree with the simplicity people for the most part.

I would look at each card, and ask yourself why you have it. Is it because of the rewards? The high limit? The age of the card? For each of those, would any other card that you already have be as good, or almost as good? Then close the ones that don't make the cut. Closing accounts might drop the credit score by a few points for awhile, but isn't likely to do any longterm damage.

We have 3 cards. One general purpose "cash back" card that also has no foreign exchange fee and good foreign exchange rates, and two others that have special deals at places we spend a lot of money at. All of them have $20k+ limits, so credit utilization isn't a problem for us.
Yes, I’m really that pedantic.
mr_brightside
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Re: Should I cancel a few of my credit cards

Post by mr_brightside »

i'd be inclined to keep 2-4 max.

you might consider looking at keeping a couple of the 'oldest' ones and a couple of the 'best rewards' and go from there.

afaik any credit score 'blip' would be temporary. just make sure your credit 'use' is spread somewhat evenly.

personally -- i just prefer straight cash back. i don't play the rewards / bonus / freeby game.

-----------------------------------------
GP813
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Re: Should I cancel a few of my credit cards

Post by GP813 »

I would keep any credit card without annual fee that gives you a free credit score and try to cover the 3 major bureaus(Equifax, Trans Union, Experian). I know Discover gives you Trans Union if you have a Discover Card with a real FICO credit score and not a Vantage score. A lot of Citi cards give you a free Equifax credit score. So with the right 3 credit cards you can monitor your credit for free while also getting a free FICO credit score.

You are also allowed to lock most cards now. So you can keep a card but shut off access for it being used until you need to use it.
mptfan
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Re: Should I cancel a few of my credit cards

Post by mptfan »

GP813 wrote: Mon Jan 10, 2022 4:50 pm You are also allowed to lock most cards now. So you can keep a card but shut off access for it being used until you need to use it.
Locking/freezing a card does not stop all activity. For example, the following transactions will continue to occur when you freeze a Discover card...

What happens when I freeze my account?
Freezing your account tells Discover that you don’t want us to authorize new purchases, cash advances or balance transfers until you unfreeze. Your account number will not change when you freeze your account.

The following transactions WILL NOT continue to occur when you freeze your account:

New purchases
Cash advances
Balance transfers

The following transactions WILL continue to occur when you freeze your account:

Merchant indicated recurring bills
Returns
Credits
Dispute adjustments
Payments
Discover protection product fees
Other account fees
Interest
Rewards redemptions
Exempted transactions
Delayed authorizations (such as some transit purchases)
GP813
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Re: Should I cancel a few of my credit cards

Post by GP813 »

mptfan wrote: Mon Jan 10, 2022 6:13 pm
GP813 wrote: Mon Jan 10, 2022 4:50 pm You are also allowed to lock most cards now. So you can keep a card but shut off access for it being used until you need to use it.
Locking/freezing a card does not stop all activity. For example, the following transactions will continue to occur when you freeze a Discover card...

What happens when I freeze my account?
Freezing your account tells Discover that you don’t want us to authorize new purchases, cash advances or balance transfers until you unfreeze. Your account number will not change when you freeze your account.

The following transactions WILL NOT continue to occur when you freeze your account:

New purchases
Cash advances
Balance transfers

The following transactions WILL continue to occur when you freeze your account:

Merchant indicated recurring bills
Returns
Credits
Dispute adjustments
Payments
Discover protection product fees
Other account fees
Interest
Rewards redemptions
Exempted transactions
Delayed authorizations (such as some transit purchases)

Good info but it stops new purchases which is the point.
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AerialWombat
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Re: Should I cancel a few of my credit cards

Post by AerialWombat »

1. Congratulations on digging yourself out of debt. That is a massive accomplishment.

2. If you always pay them all off each month now, closing cards will not impact your utilization— because it’s already zero. This will thus not impact your score.

3. You might want to keep open the oldest card (Discover?), because your Age of Oldest Account does have a bearing on scores.
For entertainment purposes only.
bling
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Re: Should I cancel a few of my credit cards

Post by bling »

got almost 20 active cards :twisted:

4-5 get active use, based on the category. the rest, i call a number once every 5 years to activate and then it goes into the drawer, never to be seen again until its replacement arrives another 5 years later.
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anon_investor
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Re: Should I cancel a few of my credit cards

Post by anon_investor »

bling wrote: Mon Jan 10, 2022 9:20 pm got almost 20 active cards :twisted:

4-5 get active use, based on the category. the rest, i call a number once every 5 years to activate and then it goes into the drawer, never to be seen again until its replacement arrives another 5 years later.
The CC companies don't close any of your non-utilized accounts for inactivity?
bling
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Re: Should I cancel a few of my credit cards

Post by bling »

anon_investor wrote: Mon Jan 10, 2022 9:51 pm
bling wrote: Mon Jan 10, 2022 9:20 pm got almost 20 active cards :twisted:

4-5 get active use, based on the category. the rest, i call a number once every 5 years to activate and then it goes into the drawer, never to be seen again until its replacement arrives another 5 years later.
The CC companies don't close any of your non-utilized accounts for inactivity?
i used to do one small transaction yearly on all of them to keep them active. i stopped doing that a couple years back and so far only a couple have closed out due to inactivity. most are still open.

in general you want to keep all your cards open, not for the credit history (that's always on your report, even after you've closed them), but because it lowers your credit utilization ratio. the 4-5 active cards i use account for like 80% of my available credit so it's not a big deal to me if my unused ones get closed.
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anon_investor
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Re: Should I cancel a few of my credit cards

Post by anon_investor »

bling wrote: Mon Jan 10, 2022 10:16 pm
anon_investor wrote: Mon Jan 10, 2022 9:51 pm
bling wrote: Mon Jan 10, 2022 9:20 pm got almost 20 active cards :twisted:

4-5 get active use, based on the category. the rest, i call a number once every 5 years to activate and then it goes into the drawer, never to be seen again until its replacement arrives another 5 years later.
The CC companies don't close any of your non-utilized accounts for inactivity?
i used to do one small transaction yearly on all of them to keep them active. i stopped doing that a couple years back and so far only a couple have closed out due to inactivity. most are still open.

in general you want to keep all your cards open, not for the credit history (that's always on your report, even after you've closed them), but because it lowers your credit utilization ratio. the 4-5 active cards i use account for like 80% of my available credit so it's not a big deal to me if my unused ones get closed.
I thought closed accounts drop off your credit report after a certain number of years.
tomsense76
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Re: Should I cancel a few of my credit cards

Post by tomsense76 »

anon_investor wrote: Mon Jan 10, 2022 11:06 pm
bling wrote: Mon Jan 10, 2022 10:16 pm
anon_investor wrote: Mon Jan 10, 2022 9:51 pm
bling wrote: Mon Jan 10, 2022 9:20 pm got almost 20 active cards :twisted:

4-5 get active use, based on the category. the rest, i call a number once every 5 years to activate and then it goes into the drawer, never to be seen again until its replacement arrives another 5 years later.
The CC companies don't close any of your non-utilized accounts for inactivity?
i used to do one small transaction yearly on all of them to keep them active. i stopped doing that a couple years back and so far only a couple have closed out due to inactivity. most are still open.

in general you want to keep all your cards open, not for the credit history (that's always on your report, even after you've closed them), but because it lowers your credit utilization ratio. the 4-5 active cards i use account for like 80% of my available credit so it's not a big deal to me if my unused ones get closed.
I thought closed accounts drop off your credit report after a certain number of years.
Is there much reason to keep them if you don't use them any more?
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
soxfan10
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Re: Should I cancel a few of my credit cards

Post by soxfan10 »

mptfan wrote: Mon Jan 10, 2022 1:14 pm
RobLyons wrote: Mon Jan 10, 2022 12:07 pmI currently have about 8 or 9 cards and there's no need to look through statements.
How do you know if there are any unauthorized charges?
Pretty simple. Is the balance zero? If not, then there is an unauthorized charge.

A weekly check on an aggregator takes 30 seconds.
tomsense76
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Re: Should I cancel a few of my credit cards

Post by tomsense76 »

quantAndHold wrote: Mon Jan 10, 2022 4:46 pm I agree with the simplicity people for the most part.

I would look at each card, and ask yourself why you have it. Is it because of the rewards? The high limit? The age of the card? For each of those, would any other card that you already have be as good, or almost as good? Then close the ones that don't make the cut. Closing accounts might drop the credit score by a few points for awhile, but isn't likely to do any longterm damage.

We have 3 cards. One general purpose "cash back" card that also has no foreign exchange fee and good foreign exchange rates, and two others that have special deals at places we spend a lot of money at. All of them have $20k+ limits, so credit utilization isn't a problem for us.
+1

Operate similarly with 3 cards. 1 has the highest cash back minimum so miscellaneous purchases go there. 2 have no FTF and give higher cash back on a range of things desirable when on the move (travel, dining, entertainment, etc.). 1 has a high cash back rate that is customizable (using for online purchases) and good cash back on groceries. This covers a lot of bases at a good (not great) level of cashback, which keeps the rewards reasonable and hassle minimal.
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
tomsense76
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Re: Should I cancel a few of my credit cards

Post by tomsense76 »

Money_Badger wrote: Mon Jan 10, 2022 11:04 am I finally dug myself completely out of credit card debt about a year and a half ago, and I've been religious about paying off my full balance every month. I did recently sign up for a new Chase / United Airlines card to take advantage of a $250 incentive for some flights we are taking in April.

I have a number of Cards:

Chase (leftover from a balance transfer promotion) - don't use - 0 balance - $8800 limit
BofA Preferred Rewards - use for dining out only - 3% cash back - No fee - 19K limit
BoA Quantum MasterCard - Don't use - 0 balance - 30K limit - No fee
Citi Costco - use for other cashback stuff (gas, travel, etc) - Pay off monthly - 27K limit - No fee, just the Costco membership fee
Citi American Airlines - just for airline stuff - 0 balance - $99 yearly fee - 19K limit
Chase United - used only for this large airfare purchase recently - I just got this card so can't cancel - $99 / year - 19K limit
Discover - I've had this card forever and haven't used it in years. - No fee - Not sure what the limit is

Should I cancel some of these cards? I have excellent credit, would that hurt my credit score?

The more cards I have, the more chance of fraud.

Thanks in advance!
Would suggest closing any cards you don't use. Seems you have identified a few.

May also be worth looking through your recent spending habits to see which are most valuable. Of course this may change as things continue to normalize.

For ones at the same institution (looking at BoA) for example. Would ask if they can combine the credit limits and onto whichever card you keep.

Looks like you have 2 airline cards. Do you use both? Do you plan to keep using both? If not, maybe it is worth dropping one (sounds like one has to stay around no matter what).

Think if you do all of that, you would be down to 3-4 cards, which seems like enough.
"Anyone who claims to understand quantum theory is either lying or crazy" -- Richard Feynman
Independent George
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Re: Should I cancel a few of my credit cards

Post by Independent George »

humblecoder wrote: Mon Jan 10, 2022 2:05 pm Since the majority of respondents are telling you to "close 'em", I am going to play devil's advocate and make the case for having multiple credit cards.

Personally, I currently have TEN credit cards opened. However, I try to make sure that every card has a purpose. Here is what I have

BoA Premium Rewards: This is my default card. Since I am Platinum Honors member (>$100K in BoA + Merrill Edge), I get 2.625% cash back on all purchases. This also gives 3.5% back on travel and dining if you are a Platinum Honors member. This card has an annual fee, but I have made up for it by using the TSA Pre-check credit and the travel credit.

BoA Cash Rewards: This gives 5.25% back in a select category, as well as 3.5% back on groceries + warehouse stores. Again, I get the higher cash back being a Platinum Honors member

Chase Amazon: 5% back on Amazon purchases

Target RED Card: 5% back on Target purchases

Discover: 5% back in rotating categories

Chase Freedom: 5% back in rotating categories

Chase Sapphire: I got this for the large signup bonus which I used for 3 plane tickets already, and I still have many points to burn. Also, this card gives primary rental insurance coverage. This card has an annual fee, but the signup bonus more than made up for it.

Hilton Amex: Bonus points when charging a stay at a Hilton property + automatic gold status. Not as useful since 2020. In normal years, I get more value out of it than what I pay in the annual fee, but not so much anymore.

Fidelity Visa: This used to be my default card since it gives 2% cash back, but it has been superseded by the BoA Premium Rewards. I am keeping it for now because occasionally Fidelity gives a special bonus offer for extra cash back

USAA Visa: I rarely use this. It used to be my card for gas purchases (3% back) but awhile back they converted it to a flat 1.5% cash back card.

I am toying with getting rid of the last three since they no longer serve as big a purpose, but the others I am keeping for now.

With my level of purchases, I am usually able to net about $2000+ per year with my system. At some point I might feel like simplifying it, but that moment is not today :-). I know my wife is a "one card" person... nothing wrong with that either. I freely admit that my system isn't for everyone and there is nothing wrong with that. I won't take offense. I am just providing another perspective for the OP to chew on.

People have mentioned how hard it must be to manage transactions on all of these cards. However, I use a popular financial aggregator* site which allows me to see all of my transactions in one place. In addition, I set up various fraud alerts (ex: notify me of a transaction greater than $X) as an additional check. Finally, I have a system for auto bill pay so I never miss any payments.

* - I know that some people have an issue with giving their information to financial aggregators. For me the risk is worth the reward, but I know others come to a different conclusion, which is fine too. To each her own.
On average, how much do you spend on each card per year? How much does that translate to in rewards per card? My issue with that many cards is not the complexity, but that when you disperse the rewards across that many accounts, the benefits are minimal. For example, I cancelled my Target red card because for the amount I was spending, the 3% difference between that and a flat 2% cashback came out to less than $10/year. My total reward points/year is usually around $300 ($200 on my 2% Citi card, $50 each on the other two); at best, having more specialized cards might take that up to $350, which just doesn't seem worth it to me.
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