Financial Planning for Generation X & Y Women
 
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Expert Q&A Archive

10/24/2008
How long will closing out a credit card affect my credit score?
I have a question in regards to closing out a credit card. If you (or a company) closes your credit card, for how long will it affect your credit score?
Gerri Detweiler:
expert info »
I get a little concerned when people get worried about the effect of specific small actions on their credit reports. Credit scoring systems use very sophisticated analysis (a.k.a. a lot of data crunching!) to predict how people will pay their bills. You and I could both close an account on our credit reports today and the effect would be different for each of us. And that also means, unfortunately, that it is impossible to predict how long it will affect your credit -- or even if it will.

The bottom line: If you have a good reason for closing the account, then close it. If you don't have a good reason for closing it, then leave it open.

If you really want to drill down to specifics, the best tool for playing "what if" scenarios with your credit is MyFICO's Score Simulator, which is included in some of their credit score products.
Delores Lenzy - Jones, CPA, CIA:
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I believe it will be dependent on the reasons for the closeout.