Cancel credit card

Disneyfan

I have a hsbc credit card which I never use. Should I cancel it? I have an m&s bank one aswell which I pay in full every month. I would also like a 0% on new purchases one.

Thanks

[Deleted User]

If you like. But it depends on your circumstances.

I would keep 2-3 cards depending on limits and income.

Nasqueron

Take a look at salary vs available credit (not how much you use) - there is a commonly referred to figure recommending no more than 50% of salary as available credit (there will always be exceptions, it's not a rule per se as it depends on your previous financial behaviour) - if you have say a salary of 20k and 2 cards with combined limit of 12k then you may well get a lower limit 0% card, or even be refused (or get 10k, who knows ).

If the card is never used and you would be well under the 50% figure, keep it for emergencies, otherwise may be worth junking it (then leave it until the agencies pick up the closure and reduction in available credit before applying).

As an example (completely meaningless but just for reference)

My salary is 18500
I had a bank CC limit £8850 + supermarket CC limit £3300
12150/18500 (65.7% of salary)

I reduced bank CC to £3000 + supermarket CC to £2000 (27%) before applying for a BT card - got 5.5k which was way more than I needed but was very handy to deal with a few purchases I wanted to do interest free = total CC limit vs salary = 56.8%