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After investigating these questions (1 and 2) I am still in doubt in what to do with my current situation.

I have many credit cards because over the years I have been given better deals on them. So I take one to take upon a deal and now I have many cards.

I have 2 cards that share a yearly fee, the fee is already paid all the way till June 2012 because when I tried canceling they extended the cards without paying the fee. These cards are from 2009, so they are relatively new. Since I have many cards I am not using these cards at all.

I am concerned that because I have many CC I will forget to do something important and get a fee charge at some point. I am also concerned about my credit rating. But based on the links above, I do not think my credit will suffer that much for closing a card that has only been opened since 2009.

My credit is excellent.

Should I keep these two cards opened because they extended them without me paying additional? Or should I close them because I have many others? (2 Amex, 2 Visas, 1 MC, 2 more that I don't use but I don't cancel because they have no fee)

Any ideas?

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How An Additional Credit Card Affects A Score

Each card you have open affects your credit score in several major ways:

  • It changes the average age of credit lines you have, older is better.
  • It changes your overall credit utilization by affecting both the numerator (outstanding balance) and denominator (available credit) of the equation. Lower utilization is better. Additionally, a higher total credit limit is better.

Your situation

  • You've stated that these cards are your "youngest" cards, so canceling them will not hurt that factor in your score. In fact, it may help.

  • That leaves credit utilization. You've stated that you don't use the cards, so let's assume that the effect on the numerator of the equation is zero. So what we're really talking about is the change on your total available credit. The amount that canceling any card can affect your credit score is directly related to the proportion of your total CC available credit that comes from that card.

    • If this proportion is high (more than 20% or so), then consider keeping them and setting a calendar alert to remind yourself to revisit the issue before you will be charged any fees.

    • If it's low, then you can probably cancel the cards with only a minimal effect on your credit score.

If you don't have any credit events like refinancing a mortgage or taking out a car loan coming up soon, then the hit your score will take is probably not a big deal, so it may be worth the peace of mind to just cancel them.

I can't tell you what the best decision for your situation is, but it sounds like you have your situation well in hand and will do fine.

Edited to add first section.

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    If these two cards to account for a high proportion of your available credit, you could just ask for a higher credit limit on some of your other cards. – Stainsor May 19 '11 at 21:34
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I've written two articles on this topic, Your Credit Score and Too Little Debt? discuss both the components that make up the score as the impact of having months of zero utilization. I suggest before you do anything, find out your score. Credit Karma does a decent job producing a score similar to FICO.

  • I read both articles. Thanks for the reference. Too little debt shows a mistake that I am also making, which is paying my CC before the bill comes in. None of the two will actually make reference to my situation of cancelling a card that is as recent as 2009. Credit Karma website looks decent, but I get very nervous with online webpages for finances. Thanks again. – Geo May 19 '11 at 20:42
  • The first article/overview shows how history impacts. By killing newer cards, I don't think you reduce your history, so you are fine. – JTP - Apologise to Monica May 19 '11 at 23:08
  • +1 These are both good articles, Joe. I also like Credit Karma. – Sean W. May 20 '11 at 0:16

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