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If you have zero balances, your credit utilization rate is zero, and won’t be impacted by the loss of a balance.
So, for one person, closing an older account can represent higher risk than it does for another person solely because of the unique nature of their overall credit histories.” If you are young and have a short credit history, closing the account could hurt your overall credit score more than if you were someone in their 50s who has a much longer credit history.
As stated earlier, closing the account doesn’t wipe that account history off your report, so if you open a new credit card with more attractive terms to replace the card you’re canceling, your credit score ’t take a big hit.
Provided you have considered these issues and have another credit card you can make charges on, you are ready to cancel your credit card.
In the case of rewards cards, it is common to lose some accrued rewards when a card is closed, and this may be unavoidable.
But with planning, it should be possible to minimize the loss.
“If a person established good credit, the impact of card closure should be minimal and short-lived,” says Christina Goethe, spokeswoman for FICO, the provider of the most commonly used credit score.