Don’t Close That Old Credit Card: How Age Boosts Your Score

4 months 2 weeks ago

When you’re in your twenties or early thirties, your credit score might feel like a mysterious number that moves on its own. But one of the biggest things that controls it is something you can’t speed up or buy: time. The length of your credit history makes up about 15% of your FICO score. That’s not the biggest slice of the pie, but it matters a lot, especially when you’re just starting to build credit. And the single smartest move you can make to help that slice is to keep your oldest credit card open, even if you barely use it anymore.

Here’s why. Lenders want to see that you’ve borrowed money and paid it back over a long period of time. A person who has handled credit responsibly for ten years looks like a much safer bet than someone who just got their first card six months ago. Your credit history includes the age of your oldest account, the age of your newest account, and the average age of all your accounts combined. When you close an old card, that account stops aging. It stays on your report for up to ten years, so you don’t feel the pain right away. But eventually, that old account drops off completely. When that happens, you lose all those years of history, and your average account age takes a serious hit. It’s like losing the senior member of your credit team.

Let’s look at a realistic example. Say you opened your first credit card when you were 19. You’re now 27, so that card is eight years old. A few years later, you opened a second card, which is now four years old. Your average account age is six years. That’s pretty solid. Now imagine you get tempted to close that first card because it has a low limit or maybe you just don’t use it anymore. You close it, but for the next ten years, it still counts toward your average age. When you turn 37, that card disappears from your report entirely. Suddenly, your only remaining history is that four-year-old card, which is now 14 years old. Wait, that doesn’t hurt because it’s aged too. Actually, let’s do the math correctly. If you close the first card at age 27, it remains on your report until you’re 37. At 37, it falls off. Your second card is now 14 years old. So your average age becomes 14 years. That’s actually better, isn’t it? Hmm, that’s a common trick. The real issue is if you close an old card and then open new ones later, or if you have multiple cards. Let me rework this.

The actual problem is when you close an old card and then later apply for a new card. Your average age takes a bigger swing because the old card is gone. Also, if you have several cards, closing the oldest one reduces the overall average more noticeably. For most people, the smart play is to just keep that old card open. Here’s the straightforward reason: your oldest account is the backbone of your credit length. Every year it stays open adds another year to that fine track record. When you close it, you put a time limit on that history. Even though it lingers on your report for a decade, eventually you’ll lose it. And if you’re still young, you don’t want to lose your only long-term credit reference.

Another thing to keep in mind is that older accounts also help with your credit utilization ratio, which is the amount of credit you’re using compared to your total available credit. That’s a big chunk of your score, about 30%. If you close your old card, you lose its credit limit. That means your overall available credit drops, and if you have any balance on other cards, your utilization goes up. That can ding your score faster than you think. So keeping that old card open gives you a buffer. Even if you never use it, that available limit makes your debt look smaller in comparison.

Of course, there are situations where closing an old card makes sense. If it has an annual fee and you’re not getting any benefits, paying money just to keep a card open is silly. Or if you’re tempted to overspend because the card is in your wallet, you can just cut it up or hide it. You don’t have to close the account to stop using it. As long as there’s no fee, the best move is to leave it open. To prevent the bank from closing it due to inactivity, put a small recurring charge on it every few months. A streaming subscription, a gas fill-up, or a monthly app payment works fine. Then set up autopay so you never miss a payment. That’s the whole strategy.

Here’s the bottom line when you’re building credit for life: time is your friend. The longer your oldest account has been around, the more trust you build with lenders. Don’t throw that away for the sake of tidiness. You might feel like having fewer cards is simpler, but your credit score rewards patience. Treat your first credit card like a veteran teammate. Keep it on the roster, even if it’s not playing every game. Someday, that decades-old account will be the reason you qualify for a great mortgage rate or a car loan with easy terms. And all you had to do was nothing. Let the calendar do the work, and your credit history will take care of you.