Should I close my 'old' credit card account?

Morning all,

As part of my general drive to get more for my money I've been doing some pretty serious financial moving this week.

I have banked with the same bank since they started a 'bank at my school' in 1995. I carried on with them through university and forever since. But I get nothing from them, so I'm leaving.

Current account switch happening
Isa switch happening and my new rewards credit card has just arrived.

My question is: do I close my existing credit card down?
There is a £4.5k limit and it's empty (always pay the balance in full)
New credit card has a £5k limit.
I was only expecting a low limit with the new credit card, so assumed I'd keep the old one in case I needed to make a big purchase.

Other info:
I have a 'full' emergency fund
No debt other than the mortgage, Wuxi her overpay.
And no impending big purchases.

What would you do?

Many thanks
Wish.
Outstanding mortgage: £23,181 (December 19)
MFW 2020 Challenge Member #10 0/£2318

Comments

  • molerat
    molerat Posts: 31,702
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    Keeping it will keep you average account age up and always having 2 cards available is good.
  • Thank you for commenting, but please forgive my ignorance, why is average account age important?
    Outstanding mortgage: £23,181 (December 19)
    MFW 2020 Challenge Member #10 0/£2318
  • [Deleted User]
    [Deleted User] Posts: 35,242
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    It shows you're trusted in the long term.

    Both your limits are fairly low - keep them both. It's also useful to have at least one back up.
  • Thank you I shall keep the original card then.

    I thought my limits were quite generous - how much can credit card limits be?

    I do know I couldn't afford to repay even the minimums if I maxed them both out.

    Scary that they let you borrow the money isn't it?
    Outstanding mortgage: £23,181 (December 19)
    MFW 2020 Challenge Member #10 0/£2318
  • [Deleted User]
    [Deleted User] Posts: 35,242
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    High limits are around 20k plus.

    The limits are only scary If you spend the lot and have no plans to pay it back.
  • nic_c
    nic_c Posts: 2,928
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    I do know I couldn't afford to repay even the minimums if I maxed them both out.

    Scary that they let you borrow the money isn't it?
    They do risk assessments based on past history, and set a limit accordingly. As stated only scary if you use it and do not have a method to repay, or if you feel such a limit would prove too much temptation.

    What's really scary is the subprime lenders who charge high APR's and whose business model is based on the fact that many of their customers will default. Or its seen as responsible lending to set minimums that just pay a little over the interest charged so that they may take decades to pay debt off.
    The warnings you get on CC statements about it taking longer to pay off debt if you only pay the minimum is the same tick box exercise that puts "drink responsibly" on alcohol or "when the fun stops, stop" on gambling adverts. Put on to show they are doing something about it when their business model is based on consumers not paying attention to it! :mad:
  • Indeed Nic,

    I have had a few occasions of having credit card debt (on this one card) as a student but in the last 10 or so years I've only ever used the credit card for online purchases or to get the additional protection for purchases over £100.

    I will use the new card a bit more as I'll get reward points, but YNAB will keep me on the straight and narrow.

    Thank you all for taking the time to comment.

    Wish.
    Outstanding mortgage: £23,181 (December 19)
    MFW 2020 Challenge Member #10 0/£2318
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