Should I keep my Credit Cards open?

bluemonkeyape

Hi there, hoping for some advice please.

After years of credit card debt, I finally paid them all off this year - woohoo! 

I currently have several credit card accounts open as a result of multiple balance transfers throughout the year, but my balance is £0.

My total credit limit is £42,100 spread across seven cards. All of these were originally balance transfer cards, and none offer favourable terms or fee-free spending.

I’m considering whether I should close some of these accounts. Ideally, I’d like to close them all and replace them with a single low-limit purchase card for emergencies. However, I’m aware that credit utilisation can positively impact credit scores.

What would be the best thing to do?

Thank you!

TadleyBaggie

Possibly keep one open. It's generally seen as a good thing to have at least one longstanding account.

Desmond_Hume

I think you should close them. For two reasons. 

A - nobody (meaning banks or other financial institutions) care about your credit score;
B - you’ve a bad history with credit. So just remove the temptation, now. 

maman

Only you will know whether you can trust yourself with a credit card going forward but I think it's useful to have one. 

If you can train yourself to use it and pay it off in full every month then I think you should get one.

They are useful for paying for items over £100 for Section 75 protection.

Hopefully, as you've paid them all off👍, you are now using your good habits to accumulate savings so that you're cushioned from emergencies. 

Marchitiello

As others have said, if you can trust yourself to not fall into debt again and use it but paying it off monthly, a CC can be a great tool.

what I would do however, is looking at product swap from the same providers (assuming these include the main providers like Barclaycard, Lloyds/Halifax/MBNA, Santander, HSBC, where in their offering you may find some sort of travel card and/or reward/cashback card.

The benefit of a product swap is that your underlining Credit account will remain the same and thus benefit from a longer history, as well as not having to “apply” for a new credit product and would definitely keep the same limit. Assuming that you have options for a product swap and two or more providers offers a similar alternative product (e.g. a 0 forex fee card), I would go for the provider with whom I have had the account the longest.

I have successfully made product swap before with MBNA and Barclaycard for sure, and maybe Santander (cannot be sure), but also managed to combine Credit Limits when holding multiple cards with the same provider (at one point I had 3 Balance transfer Cards with MBNA, product swapped the oldest card for a Travel Card, combined the credit limits of the other two into the older accomuna/new card, and closed the other two, and was left with a usable card with £20k limit).