To cancel or not to cancel – that is the question

You got a travel credit card, met the spending requirements and got the sign-up bonus.  Now what?  Should you cancel the card right away?  Here are some things to consider when trying to decide if you should cancel or not:

  • Part of your credit score is how old your credit is.  That part of the credit score will be higher the longer you keep your credit cards.
  • Nearly every travel credit card comes with an annual fee, many which are waived the first year.  So you either paid for the first year or you have the card for free the first year.  Why not keep it for that year so your credit can age?
  • When you call to cancel the card, some credit card companies will offer you something to keep the cards.  This may include another year with no annual fee or more bonus points.
  • Travel credit cards are an easy way to keep your frequent flyer miles active.
  • Some credit cards will pull the sign-up bonus points back if you keep the card for less than six months.
  • Many of the sign-up bonuses are for first time credit card holders.  So that would lead you to believe you can only get that bonus one time.  However, some credit cards will allow you to get that bonus again if you haven’t had that card open for the last 18 – 24 months.  This is where the game gets interesting.  You need to balance the need to let your credit age with the possibility of getting another sign-up bonus in the future.
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