How bad is it to have a credit card you don’t use?

Thank you, HGTV Magazine for publishing my credit tip in your October issue.

In case you can’t read the image from the magazine page, here is what it says:

How bad is it to have a credit card you don’t use?

“It could actually work in your favor. Credit bureaus calculate credit scores in part by comparing the total balance across a person’s credit cards with total available credit. So if you have two active cards with low balances and a dormant one with zero balance, that makes you look good because the ratio of total balance to total credit limit is lower than if you had only two active cards, says Carolyn Warren, author of Repair Your Credit Like the ProsJust know that issuers can cancel inactive cards without warning. “When a card gets closed, your credit score might take a hit since your available credit will go down,” Warren says. That may be an issue if you plan to apply for a mortgage. If so, pull out the unused card on occasion for, say, birthday dinners, and pay it off on time. But if there’s an annual fee that’s higher than the cash back or travel rewards you’re recouping and a credit dip isn’t an issue, close the card — one less fraud risk.”



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