Once a credit card is paid off, will it help your credit score to keep the acct open or close it out?

I have been closing all of my accounts out once I pay them off, and my brother insisted that I stop that and keep them open even in I plan to not use it again. What is the best thing to do to increase my credit score?

Public Comments

1. well it depends on how many you have. i would keep at least one or two active and cancel the rest. its good to have open credit but not an abundance of it.
2. If you keep them open then it help you because you have X amount of available credit to use but you only owe X amount of dollars. Also, if you have 2 or more major credit cards it also helps.
3. If you don't have more than 4 or 5 keep it open. Having that history is great for your credit.
4. Close the accounts you are not planning to use. Even with a zero balance, lenders view open accounts as a potential debt for the card's limit.
5. It's good to keep them open b/c it shows that you have a good credit-to-debt ratio. Just because you pay it off doesnt mean you have to close it....you could cut it up and just not use but keep it open. It will show credit companies that you have a good amount of credit available to you.
6. It depends. If it is your only one, I would keep it open with a zero, or very low, balance. If you have others, closing it out will help to keep your total potential liability lower. It is not much difference either way though.
7. If you have a high limit, keep the card. The more available credit you have (that is, credit available, but not used), the better it will look on your credit. Basically, if a credit card company likes you enough to give you a ten thousand dollar limit or something, and you don't have it maxed out....a lender is going to like the looks of things with you.
8. keep at least one active
9. Keep at least 2 open (the ones with the highest limits) and use them for everyday things never exceed 30% of your credit limit in any given month and pay in full before the due date. I did this same thing and raised my score over 150-points in 24-months. O.B.T.W. even on the closed accounts the pay history will still show on your credit report.
10. Having a couple - and I mean two or three here - of open and paid accounts is good. Shows you aren't using up every dime of your available credit and that you pay on time. Serves as credit references should you decide to take out a car or mortgage loan. Too many says this person is a risk.
11. it is better to close them now and have it reflected on your report for awhile, then be denied later because although you have zero balances and haven' t used them, you could at any time.
12. You need to strike the right balance in your decisions. The average length of time your credit card accounts have been open is an important contributer to your credit score. So the accounts that have been open longer are more valuable in this regard than the newer accounts. But if you have too many credit card accounts, your credit score would not be as good as it would be if you had all of that outstanding credit on fewer accounts. And if you close an account that had a large credit line, you could skew your debt-to-credit-ratio. Here are two examples that may require different choices: 1) You have 20 credit card accounts with equal credit lines, no balance on any of them, and they have all been opened for the same length of time. In this situation, I would feel very comfortable closing one or more of the accounts. 2) You have 3 credit card accounts. One has been open 10 years and has a $5000.00 balance on a $7000.00 credit limit. Another has been open 5 years and has no balance on a $2000.00 credit limit. And the third has been open one year and has no balance on an $8000.00 credit limit. It seems like closing the account that has been open one year would help right? But it is not so simple. Your debt-to-credit ratio is .294 when all three accounts are open but jumps to .556 when you close the account that has been open for one year. So, take these things in to consideration before acting on your brother's advice or making a different decision.
13. You should keep the oldest ones open, but because the length (number of years) of your credit history helps your score. Whether closing the newest ones is wise depends on whether the total of your credit limits is (a) high, relative to your income (close some) or (b) low, relative to your total debts (do not close any).