Money & Finances

Should You Close A Paid Off Credit Card Account?

With the way employers and creditors use your credit rating to determine your worthiness to be employed or to be a trustworthy person, is it any wonder that when you finally get a credit card paid off that you don't know if you should close the account or not?

That's something I've wondered myself. I personally closed mine, but there are other opionions on this subject.

Here are some things to think about with regard to closing a credit card account:

• If the issuer closed the account once you paid it off, ask them if they'll update your account to show that the closure was voluntary.
   
• Consider leaving it open and using it a couple of times a year for small purchases that you pay off right away. This will help to rebuild your credit.
   
• If you find yourself being tempted to begin charging more than you can really afford, it may be in your best interest to either close the account, or if you want to keep it, to give it to your spouse if he or she has more willpower. Or, freeze it so it's harder to get to.

Also, see how to choose between a high credit score and being debt free.