• Basics,  Credit Cards,  Credit Scores

    Before You Cancel That Credit Card, Read This!

    One question that I am asked frequently is: “Will it help or hurt my credit score if I cancel a credit card?” I can say with certainty that the singular act of cancelling a card will never help your score. And, depending on your credit profile, the negative impact could range from negligible to significant. In my article “Decoding Credit Score Mystery Math“, I explained the factors that make up your score. The three largest factors are: Payment History (35%), Credit Utilization (30%), and Average Age of Accounts (15%). Let’s have a look at how canceling a credit card impacts these factors. Payment History Some readers may feel that closing a credit card where they have…