Debt is paid off !!! & a question about closing credit cards

[HundredK]

I open & close cards pretty regularly (for bonuses), my oldest card is only 3-1/2 years, and my credit score is in the low 800's. Good enough for me. I don't need a perfect score.

Oh, this is a relief to hear! Low 800's would be fine with me too.

Our oldest card is 26 years, a Target Visa, so that we'll keep.

For our normal usage, we use 5 cards.
- Amazon Prime Visa which gives 5% off on all Whole Foods and Amazon purchases. We live just down the street from Whole Foods, and that sure came in handy when we didn't have a car with the 5% off and free delivery. We get a lot of cash back on that one.
- Chase Freedom which actually just expanded some of their cash back categories to include 3% at restaurants
- The aforementioned Target card because of the 5% cash back on purchases
- The new Verizon Visa, which I'm not thrilled about, but it's the only way to get the $20 autopay discount without giving them your checking account info for automatic withdrawals. I try to limit who I give our checking info to.
- Macy's card. I don't know if Macy's will be around a ton longer, but that card comes with ridiculous % off deals that when combined with their sales they have every other day has saved us tons.
- I might hang onto our Amex as they have really good customer service and awesome fraud prevention, but the trouble is we've had problems finding places overseas that will accept it. So I don't know, maybe we'll close it, can't decide.

I will proceed with closing our other cards. I've also opened other store cards and whatnot along the way for sign on bonuses, etc, and now I really don't shop much at all. I know I'd also like to sever ties with Citibank. We have the Double Cash card which has been good to us, but we also bank with Citi and I am not pleased that they've closed every single branch within a hundred miles of us. We had to open another checking account at Chase because for business purposes we need a bank that has physical locations. So I think it is time to say goodbye to everything Citi and put our support behind Chase.

[LivingAlmostLarge]

Congrats! how did you pay off the $162k? Was it selling stuff? Or getting rid of cars that sounds like they were 50k. Congratulations it's an AMAZING Wonderful accomplishment!

[HundredK]

Congrats! how did you pay off the $162k? Was it selling stuff? Or getting rid of cars that sounds like they were 50k. Congratulations it's an AMAZING Wonderful accomplishment!

Thanks! I'd say it was a little of everything. Yep, we sold our car which gave us $20k (that depreciation gets ya), but mostly we just started making better decisions. We went kind of scorched earth. I restructured my business activities to work from home instead of constant travel (which worked out well in our new virus world). We logged and monitored every expense, something I continue to do even now and don't plan to stop. We mapped out our debt and made the best of it we could, paying the most expensive debt first, regardless of what kind of debt it was. We plotted and schemed to get everything we could onto zero interest promo rates while we aggressively paid down items we couldn't move to lower interest. We realized that we don't always need the best of everything, and that most of the time, the middle of the road or even the cheapest works just fine. When we finally bought a new car, we decided our budget beforehand and spent 2 months researching which car we wanted. We then negotiated the heck out of that thing between 7 dealers and came in under budget with a trim level up from what we were aiming for (the dealer we liked most was out of stock of the trim level we were looking for, so they negotiated with us based on the quotes we'd gotten from other dealers for the trim level we thought would suffice). Still now a year later it bluebooks at quite a lot more than we paid (and we paid for it in cash). So it was really just a lot of soul searching and commitment to change. A lot of thinking about how we want things to be and then taking steps to get there. I wouldn't say any part of it has been incredibly easy, but life is a heck of a lot more rewarding now. We also bought state park passes and have learned to find ways to enjoy life that don't cost quite so much. Yeah, a little of everything.

[kork13]

I would also add that if you are now debt-free and intend to stay that way, the impact of closing a credit card is really insignificant in the grand scheme of things. Does it really matter if your score drops 10 or 20 points if you aren't applying for any new credit?

This is pretty much my thought on it.... Close the cards that you don't use, totally regardless of any other factors. Credit cards are a tool to be used -- not an idol to worship. You've obviously learned to be responsible with them, so just keep the ones you want, ditch the rest, and don't worry about your credit score. If you're done borrowing money, you won't need it anyway.

And CONGRATS on being FREEEEEEE!!!!!!!!!

[MonkeyMama]

Congrats!

I have never kept open unused cards. I have at times had only 1 year of open credit It's never made a blip on my 800+ FICO score. (& when I Say this, a 750+ score is an A+. Did it knock my score 5 or 10 points? Maybe? Would it matter at all? No). As mentioned above, good credit does stay on your report for 10 years and clearly weighs more heavily than closing an old card. This is re: close-as-you-go approach.

Clearly, closing a chunk of old cards at once will be different, but I'm still in the "why does it matter?" camp if you have no debt and no plans to borrow.

[Manjit Virdi]

Keeping credit card accounts open for as long as possible is a smart strategy for building and maintaining good credit, especially if you're planning to take out a loan in the near future. Evaluate the age of the account and its credit limit before closing it, but take stock of your spending habits and any fees associated with the card too.

Every financial decision is a personal one; while keeping unused accounts open is generally best, you might find that closing one is the better choice for you.

[HundredK]

Keeping credit card accounts open for as long as possible is a smart strategy for building and maintaining good credit, especially if you're planning to take out a loan in the near future.

My plan is to never need a loan for anything EVER again... no more debt for me. That said, we are renters, and so I do want to keep our credit score high just so we know we can always qualify to lease wherever we want. I also want to be able to qualify for all the best credit cards out there to play the whole rewards game. But we're at something like 843 right now, and I'll be fine with it staying anywhere in the 800s. I really need to get on with closing a few cards. I had kind of forgotten about that already, heh.

[HundredK]

I finally called today to cancel the first of the credit cards I want to cancel. It was interesting watching my own anxiety at doing that after spending so long chasing balance transfer offers and whatnot to pay our debt down. It was also interesting the useless tactics they tried to get me to stay... they offered to lower my interest rate, and I said no, I don't ever want to pay interest to anyone again. They offered to increase my credit limit. They then offered a zero percent balance transfer offer... nope, I don't have any balances to transfer (yay!). Then as a last resort they tried to convince me to take a balance transfer anyway, but to have the money put into my checking account as cash (uhhhh, no, that would result in me paying interest at some point which I don't want to do). Anyway, one down, more to go, but it's progress! These card companies, sheesh, it's no wonder people are generally drowning in debt.

[Petunia 100]

I finally called today to cancel the first of the credit cards I want to cancel. It was interesting watching my own anxiety at doing that after spending so long chasing balance transfer offers and whatnot to pay our debt down. It was also interesting the useless tactics they tried to get me to stay... they offered to lower my interest rate, and I said no, I don't ever want to pay interest to anyone again. They offered to increase my credit limit. They then offered a zero percent balance transfer offer... nope, I don't have any balances to transfer (yay!). Then as a last resort they tried to convince me to take a balance transfer anyway, but to have the money put into my checking account as cash (uhhhh, no, that would result in me paying interest at some point which I don't want to do). Anyway, one down, more to go, but it's progress! These card companies, sheesh, it's no wonder people are generally drowning in debt.

When I close credit accounts, I write a brief letter and mail it, enclosing the card. I dislike having to repeat myself over and over that I wish to close the account. Congrats on reaching your debt-free goal.

[MonkeyMama]

Personally, I just use the online chat feature to close cards. It could be our "deadbeat" category (paying off balances every month) but usually even when I called they just close the card and didn't offer anything. This is 100% the case with online chat. Try it next time, it takes like 2 minutes of your time.