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I am 60. I have a mortgage that's nearly paid off. I have also paid off all my cards, and my oldest cards were closed from lack of utilization.

In order to protect my age of credit, do I need to not pay off my mortgage? Or, do I need to keep charging and paying off my cards, so they don't close? Because if I were to pay off all my cards, and never borrow again, everything would age off in a few years and my excellent credit would disappear.

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  • 2
    Paying off cards in not the same as closing cards. (Many in money.SE use their CC every month, don’t have a mortgage, and yet have a high score. Heck, I’ve NEVER had a public mortgage, and my score is high. Paid off my car note 4 years ago, too.)
    – RonJohn
    Jan 17 at 13:44
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    "and my excellent credit would disappear" You seem to not be borrowing money, are you expecting to in the future?
    – Caleth
    Jan 17 at 22:02
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    Get a CC that provides cash back and pay it off every month. If you do that, the CC company is paying you to be a customer. We put everything on our card and get $1.50 for every $100 we spend.
    – Dave
    Jan 18 at 22:27
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    @wizzwizz4 True, in an environment where you negotiate a price. You might negotiate using the credit card as a proposed method of payment, then ask if you can get a further discount for paying "cash". If not, go through with the card purchase as negotiated. But in, say, a supermarket, the price on the shelf is the price you will pay, and a cashback card is a good deal for you.
    – nigel222
    Jan 19 at 11:33
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    @wizzwizz4 in the UK, there is a further considerable advantage to paying by credit card. The card issuer is by law jointly liable with the vendor for the purchase. In particular, if the vendor goes bankrupt between your payment and the fulfilment of the contract, the card issuer must refund you. (It might even have to compensate you, if the broken contract causes you to incur further costs). This is a UK law, don't know if there is similar elsewhere.
    – nigel222
    Jan 19 at 11:37

5 Answers 5

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I've paid off my mortgage and never carry a balance on a credit card and my credit score is 818 (excellent).

Banks don't publicly disclose how exactly a credit score is calculated, so it's hard to predict anything with certainty but, chances are you will be just fine with paying off your mortgage and credit card balances.

Close the credit cards that you are not using but I would certainly keep one or two (good ones). Credit cards are a very convenient and safe form of payment. They are accepted world wide, it's easy to keep track of your expenses and with the right card you get cash back.

I recommend using credit cards for pretty much everything you buy (unless they charge an extra fee) but make sure to pay the balance off every month. This will result in you having more money in your pocket and an excellent credit rating.

Unless you are planning and getting a large loan in the near future, just ignore your credit score. Do what's financially best for yourself and that will take care of the credit score as well.

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    Certainly keeping the card open will keep your ratio lower because you'll be adding to the denominator while having 0 in the numerator. Closing the account will reduce the denominator with no compensation in the numerator, raising the ratio and lowering your score.
    – corsiKa
    Jan 17 at 22:00
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    @corsiKa when the numerator is 0, the ratio stays 0 regardless of changes in the denominator. Jan 18 at 0:31
  • @PaŭloEbermann, until you use the card for anything, at which time your numerator isn't 0 anymore. The banks also look at size of your denominator when calculating your credit score.
    – Seth R
    Jan 18 at 17:18
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    On "use a card for everything" - depends. You're essentially sticking your suppliers with a lower price, and siphoning off some of the delta. For many purchases, it's worth paying cash instead and getting a discount.
    – fectin
    Jan 18 at 23:44
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    Why close cards that aren't being used? If they don't charge an annual fee, there's nothing to lose from leaving them open. Moreover, under no circumstances should you ever close your oldest credit card. The length of your credit history is a major factor in the score. "just ignore your credit score" is a healthy attitude in general, but bad advice if taken literally. A higher credit score will qualify you for better cards with better rewards. Some employers use it for background checks.
    – Jay
    Jan 18 at 23:55
12

Because if I were to pay off all my cards, and never borrow again, everything would age off in a few years and my excellent credit would disappear.

Credit cards stay in your credit file as long as they are active. To keep them active use them and pay the balance off before you are charged any interest. It doesn't take much usage to keep them alive. Use one for your groceries, and another for your gas, and those two are very unlikely to be cancelled.

Using them on a regular basis shows you know how to use the credit lines you have. You don't have to pay interest to the credit card companies to keep a good score. Using them regularly makes money for the bank even if you never have to pay interest.

Closing accounts will impact your score. The average age will be lowered and the maximum age will be lowered if you close accounts that you have had for many years.

After the mortgage ages off your history you will you will see another decrease because you will not have a many different types of credit. But keeping a mortgage alive is not a good plan to keep your score high.

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  • Closing account might raise the average age if he closes his newest cards, but otherwise I agree with your answer
    – Kevin
    Jan 19 at 22:52
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I believe this is similar to an XY question.

Since you own your home, don't have debt, likely aren't applying for a new job, and don't need to borrow money, your credit score probably is irrelevant and not worth a moment's thought or your valuable energy.

There is virtually no need to worry about your credit score if you are never going to need to borrow again.

I can only think of 1 possible exception: If you have sudden large unexpected expenses, and want to (or need to) borrow to cover them. If that is a possibility, the questions would be: How would you borrow that money, and will your credit score even matter? For example, if your loan is collateralized, it's possible your credit score will not matter.

Sit back, relax, and enjoy your accomplishments!

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  • For example, if your loan is collateralized, it's possible your credit score will not matter. --- can you cite a source for this affirmation? Because collecting a collateral is not what a bank wants. I have to disagree with you.
    – Mindwin
    Jan 18 at 14:21
  • It would only be an issue if some of their utilities charge different rates based on peoples' credit scores (this can happen in Texas).
    – Tangurena
    Jan 18 at 14:52
  • @Mindwin You make a good point. I've never quite understood why banks are so reluctant to collect a collateral. A friend tried to get a bank loan with a rock solid collateral having a value of more than 5 times the value of the loan, and the bank refused. The bank literally had everything to gain and nothing to lose. I guess some banks just want to be banks and aren't good at expanding their revenue sources. But, of course, not all loans are from banks, and every bank is unique. Jan 19 at 1:29
  • @Tangurena Wow, I've never heard of such a thing. Are you saying people in Texas (USA) currently have to pay different amounts for electricity per kWH depending on their credit score? And that's legal? Why don't the utilities just collect a first and last month payment and not overcharge people who are already likely in debt? Charging different people different prices for the same electricity sounds like one heck of a racket. This doesn't happen in most places, but, of course, Texas is, well... let's be real nice... um... unique. Jan 19 at 1:35
  • @RockPaperLz-MaskitorCasket I work at a bank. The costs and fees and employee time required to cash in a collateral are ridiculous. And just like a tenant can trash a home before they leave, so does the borrower.
    – Mindwin
    Jan 19 at 12:57
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In order to protect my age of credit, do I need to not pay off my mortgage?

No, pay off your mortgage. It would be stupid to pay interest as an effort to keep your credit score higher.

Your score might drop a whole 10 points per https://www.fool.com/the-ascent/personal-finance/articles/what-happens-to-your-credit-score-if-you-pay-off-your-mortgage/


my oldest cards were closed from lack of utilization

I set up my oldest credit card on autopay for my Internet bill to avoid this scenario.

This isn't a superfluous expense at trying to trick the almighty credit bureau; it's a necessary planned expense so it's okay to just autopay it.


Because if I were to pay off all my cards, and never borrow again, everything would age off in a few years and my excellent credit would disappear.

Correct, don't let your credit history go stale for 10 years.

https://www.creditcards.com/credit-card-news/credit-score-disappeared-inactivity/


It's easier to keep a credit history active by maintaining 2-3 credit cards for an extended period of time than it is to start from scratch; albeit not impossible.

As an 18-year old I got my first credit card with a $300 limit; presumably I had zero credit.

As a 23-year old I got my first car loan on a score of about 720; paid off after just 4 years.

As a 29-year old I got my first house with a credit scored of about 810.

We all started somewhere so for you it's just a matter of not starting completely from scratch because I would bet that a $300 credit limit does not sound enticing at your age.


Lastly, a loan is not impossible to acquire if you have zero credit. A creditor will assess your occupation and assets to determine if they can trust you. The interest rate might not be stellar and collateral could be required but if you need the loan then you'll take it, no?

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You don't want to close all your cards. You want to maintain a credit agency file which shows that you are a good risk, by using cards and repaying in full every month, at no cost to yourself. A cash-back card works to your benefit in any retailer, and retailer-branded cards often have better fringe benefits for spending with that particular retailer (e.g. Amazon card, or a supermarket card).

In particular, keep the card that you have held for longest. For me, that's the almost completely useless card that came with my bank account. I have hardly used it in three decades, but it pays a quarterly magazine subscription so it doesn't get cancelled for non-use! All things being equal, keeping the one with the highest credit limit may also be a good idea.

Reducing the number of cards may be a good idea. In a couple of years time, you may then become eligible for some introductory or zero-interest balance-transfer deal with the same card issuer. Card-swapping was quite lucrative back when bank deposit accounts paid 5%. If inflation kicks off, this might once again become true.

You also want several cards for travelling. I would say at minimum one Mastercard, one Visa card, and one "spare" card chosen for the lowest currency conversion fees on overseas purchases. You may run into a retailer that won't take one of the card brands, or into a situation where one of the computer networks is down. Or you may have your pocket picked, and be very thankful that you have a spare card or two in your hotel safe. (Note, a "currency card" such as Wise is likely to be the cheapest way of withdrawing cash while travelling. It may also be the cheapest way to make purchases, but it's not a credit card, and so you lose the protections which a credit card may offer).

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