How Your Credit Card Can Help To Improve Your Credit Score
By Ankit Sharma
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The best way to close credit card accounts

If an individual has many credit cards and wants to close some credit card accounts, he should keep in mind two important things: first, to avoid closing the oldest credit card account and secondly, never to close many credit card accounts at once or too quickly.

From the point of view of improving one's credit score, having a long credit history is desirable. So, in order to preserve the length of the credit history, older credit card accounts should not be closed. If one must cancel an account, opt for the most recent credit card. Also, remember not to cancel several credit cards together as it will have a negative impact on the credit score. It happens because of the reason that when many credit cards are canceled quickly, the credit limit takes a dip in at once, which lowers the credit score. So, the best way to cancel many credit cards would be to cancel them over a period of time, say, one card in two months and so on.

Spend less than 60% of the credit limit

As a general rule, cardholders are advised against spending as high as their credit limits. They should spend within 40% to 60% of their credit limit. Exercising this control over spending will benefit their credit scores as it would mean that despite having a high credit limit, an individual has not consumed it entirely and has plenty in reserve. This converts into high credit scores for an individual.

Repay credit card dues quickly

Cardholder's should not accumulate their credit card dues and try to repay their credit card debt as quickly as possible. Defaulting on credit card repayments lowers the credit score whereas paying off credit card dues timely dramatically enhances the credit score.

Don't keep any credit card idle

Those who own multiple credit cards should rotate between their cards and use all their cards. Making purchases from a single card and keeping the others idle will have an adverse effect on the credit score. In fact, no credit card should remain unused for more than 6 months.

These simple steps can be followed to ensure that an individual maintains a good credit score. A good score increases reliability of the person to get loans and allows him/her to realize their dreams.

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