Just Paid off my Radio Shack Credit Card and was wondering should I close the account? (pay, increase)

[FBJ]

I have no plans on using it since I'm not working right now and wanted to hurry up and pay the full balance so I won't have to worry about in March. So will leaving the account open at zero balance increase my credit score?

[MR77]

Here is how I understand it. You have a line of credit on that card that helps out your credit to debt ratio. If you close that card you terminate that line of credit and change your ratio. That can affect your FICO score negatively. I have paid off a few cards recently and left them open for that reason. The only ones I have closed are the ones with the annual fees. If your line of credit on that card is only 1 or 2 thousand, it might be fine just to shut it down.

[FBJ]

Originally Posted by MR77

Here is how I understand it. You have a line of credit on that card that helps out your credit to debt ratio. If you close that card you terminate that line of credit and change your ratio. That can affect your FICO score negatively. I have paid off a few cards recently and left them open for that reason. The only ones I have closed are the ones with the annual fees. If your line of credit on that card is only 1 or 2 thousand, it might be fine just to shut it down.

It doesn't have a annual fee and the limit is $600

[Sam82]

You might as well keep it open. Keep in mind that they will eventually close it because you are not using it. This happened to me with a store close that I no longer use.

[wheelsup]

I've had credit cards for years and not touched them. I would keep it, especially if you don't have many other cards and are young (not knowing your situation). If you're older and have several other credit cards that you've had for a long time closing it probably wouldn't make a dent in your credit score.

[dsnellen]

There are numerous articles on msn reference this topic. In summary, your credit score will take a hit if you have too much unused credit (because you might suddenly use it); or will take a hit if you don't have enough unused credit. A goal might be to have 2 - 3 CC with higher limits but no debt (and no annual fee) along with 1 that is used frequently but carries no monthly debt (paid off each month). And 1 more that has a balance that is always paid off early. Demonstrating that you can responsibly handle a recurring monthly debt payment is a good thing. This is all rumor as the methodology for determining a FICO score is a secret. You may find there is little correlation between your actions and the FICO score. To maintain a higher score however means you are never late with a payment and have a suitable debt capibility to actual debt ratio. Check your check file frequently! Almost anyone can post a past due payment in your file and many crooks will do this because people will pay the relatively small amount.

[foma]

There's a ton of info on the Internet so do your research and not rely solely on the posts here. The rule of thumb I've read is if you have credit, you should use it at least occassionally. The opposite is also true that if you close an account, it will also affect your credit score.

If you plan on making any major purchases within the next 6 months or so, I'd keep the card. However, if you know you don't need the card or won't be making any major purchases soon, I'd close it. That's my 2 cents.

[jdrtx]

I cancelled a Mastercard years ago . I called them and said to cancel it and they said ok. One year later it was still open. Called again and they said "ok, you're cancelled".
Two years later, they cancelled the card because of lack of activity.