Credit Cards to Keep Open Forever (Key to a Strong Credit Score)
The general school of thought here at Thrifty Traveler is to open a reasonable amount of credit cards a year, in order to earn lucrative sign-up bonuses, and then close them before the annual fee hits the next year. Now as you continue to use this method year after year this will have a slight adverse impact on your credit score by shortening the average age of your credit history. The length of your credit history comprises 15% of your total credit score, so we want to keep that section as strong as possible. The trick to maintaining a long credit history is to keep several cards open for as long as possible. Maybe you’ve had a no annual fee card open for 10 years, great keep it open. The key is to keep several cards open that have no annual fees for as long as possible. Also, make sure to use the cards at least once a year to make sure that they aren’t closed for inactivity.
Thrifty Tip #1: Keep several no fee credit cards open for as long as possible. This will help keep your credit history as long as possible and help to mitigate the impact new card openings have on your credit score.
Thrifty Tip #2: Setup auto-pay for seldom used cards so you don’t forget to pay them if you do incur a charge. Always use Mint.com to track all of your credit card accounts. I have a lot of credit cards open and using Mint is one of the best ways to be organized and make sure everything is paid on time. I’ve used Mint for almost 10 years and have never missed a payment!
I recommend the following cards:
Chase Freedom – No fee cash back card
Citi Double Cash – No fee 2% cash back card
Amex Fidelity Investment Rewards Card – N0 fee 2% cash back card that automatically goes into a brokerage investing account (Highly recommended)
Discover Cards – Multiple cash back cards with no annual fees
I will admit sometimes I don’t listen to my own advice. The cards I have had open the longest are the no fee Chase Freedom card, the Amex Starwood Preferred Guest (SPG) Personal card, and the Chase Sapphire Preferred (CSP) card. Now the SPG and CSP cards have annual fees but I’ve done the math and the benefits I get from the cards outweigh the annual fees. The SPG and CSP are also the cards I use most often, when I’m not working towards a sign-up bonus. You’ll have to do the math yourself to see if the juice is worth the squeeze.
Which cards have you had open the longest and why? Let me know in the comments below!