{"id":16477,"date":"2025-05-07T22:25:23","date_gmt":"2025-05-07T22:25:23","guid":{"rendered":"https:\/\/www.zilch.com\/uk\/?p=16477"},"modified":"2025-05-08T10:13:58","modified_gmt":"2025-05-08T10:13:58","slug":"what-happens-when-you-close-a-credit-card","status":"publish","type":"post","link":"https:\/\/www.zilch.com\/uk\/thegreen\/what-happens-when-you-close-a-credit-card\/","title":{"rendered":"What happens when you close a credit card?"},"content":{"rendered":"\n<p>Thinking about closing a credit card? It might seem like a simple decision, but it could have a bigger impact on your <a href=\"https:\/\/www.zilch.com\/uk\/thegreen\/what-is-a-credit-score-everything-you-need-to-know\/\">credit score<\/a> than you realise.<\/p>\n\n\n\n<p>Whether it\u2019s a card you rarely use or one with high fees, it\u2019s worth understanding how closing it could affect your finances before making the call.<\/p>\n\n\n\n<p>Let\u2019s break it down.<\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Closing a credit card: The pros and cons<\/strong><\/h2>\n\n\n\n<p><\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>The positives<\/strong><\/h4>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Reduces temptation.<\/strong> If a credit card makes it easy to overspend, closing it could help you stick to your budget.<\/li>\n\n\n\n<li><strong>Simplifies your finances<\/strong>. Fewer cards mean fewer payments to track, making money management easier.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h4 class=\"wp-block-heading\"><strong>The negatives<\/strong><\/h4>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Credit utilisation could go up. <\/strong>This is the percentage of available credit you\u2019re using. If you close a card, your total credit limit shrinks, which can make your <a href=\"https:\/\/www.zilch.com\/uk\/thegreen\/what-is-credit-utilisation-ratio\/\">utilisation ratio<\/a> look higher.<br>Example:\n<ul class=\"wp-block-list\">\n<li>You have two cards with a combined credit limit of \u00a35000 and a balance of \u00a31000. Your utilisation ratio is 20%.<\/li>\n\n\n\n<li>If you close one card with a \u00a32000 limit, your total credit drops to \u00a33000, pushing your utilisation up to 33%.<\/li>\n\n\n\n<li>Tip: If you\u2019re closing a card, try to pay down balances on other cards to keep your utilisation low.<\/li>\n<\/ul>\n<\/li>\n\n\n\n<li><strong>Your credit history could shorten. <\/strong>Credit age matters, and closing a long-standing card might slightly lower your score.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>When should you consider closing a credit card?<\/strong><\/h2>\n\n\n\n<p>There are times when closing a card makes sense:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>It has high fees.<\/strong> If you&#8217;re not getting enough value from a card to justify the cost, it might not be worth keeping.<\/li>\n\n\n\n<li><strong>You never use it.<\/strong> If a card is just sitting there gathering dust, closing it could be an easy way to simplify your finances.<\/li>\n\n\n\n<li><strong>It carries bad memories.<\/strong> If a card is tied to past financial struggles, closing it can help with a fresh start.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>When is it better to keep a card open?<\/strong><\/h2>\n\n\n\n<p>In some cases, holding on to a card is the smarter move:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>It has a low balance. <\/strong>Keeping a card with little to no balance open can help maintain a healthy utilisation ratio.<\/li>\n\n\n\n<li><strong>It\u2019s your oldest card. <\/strong>Your credit history length affects your score, so closing your oldest card could do more harm than good.<\/li>\n\n\n\n<li><strong>It\u2019s a store card.<\/strong> Even if you don\u2019t use it often, store cards can add to your credit mix and help diversify your credit profile.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>Tips for managing credit cards<\/strong><\/h2>\n\n\n\n<p>Whether you decide to close a card or keep it open, these tips can help you stay in control:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Pay on time. <\/strong>Late payments can hurt your score, so always make at least the minimum payment by the due date.<\/li>\n\n\n\n<li><strong>Keep your utilisation low.<\/strong> Using less than 30% of your total credit limit is ideal. The lower, the better.<\/li>\n\n\n\n<li><strong>Don\u2019t close too many cards at once.<\/strong> This could impact your score more than expected.<\/li>\n\n\n\n<li><strong>Check your credit report regularly.<\/strong> Make sure everything\u2019s accurate and dispute any errors you spot.<\/li>\n<\/ul>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><strong>So, should you close your card?<\/strong><\/h2>\n\n\n\n<p>Closing a credit card can affect your credit score, but it\u2019s not always a bad move. It all comes down to how it impacts your credit utilisation and credit history.<\/p>\n\n\n\n<p>If you\u2019re thinking about closing a card, weigh up the pros and cons first. In many cases, how you manage your credit \u2013 paying on time and keeping balances low \u2013 has a bigger impact on your score than whether you keep or close a card.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Thinking about closing a credit card? It might seem like a simple decision, but it could have a bigger impact on your credit score than you realise. Whether it\u2019s a card you rarely use or one with high fees, it\u2019s worth understanding how closing it could affect your finances before making the call. Let\u2019s break [&hellip;]<\/p>\n","protected":false},"author":18,"featured_media":16451,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[13],"tags":[],"class_list":["post-16477","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-blog"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/posts\/16477","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/users\/18"}],"replies":[{"embeddable":true,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/comments?post=16477"}],"version-history":[{"count":0,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/posts\/16477\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/media\/16451"}],"wp:attachment":[{"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/media?parent=16477"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/categories?post=16477"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.zilch.com\/uk\/wp-json\/wp\/v2\/tags?post=16477"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}