 TITLE: Should I Close a Credit Card I Opened for Holiday Rewards? CONTENT: Be Sure to Consider How Credit Cards Affect Your Credit\n-------------------------------------------------------\nAs you think through the factors listed above, there's a benefit to keeping a card account open that you should keep in mind: its impact on your credit scores.\nCredit cards affect your credit score in several ways, the most important being payment history, which accounts for 35% of your FICO® Score☉ . If this is your only credit account, using the new credit card to contribute to your history making on-time payments could greatly help your scores. As long as you make all your payments on time and avoid carrying a high balance, your new account can help you show lenders you know how to manage credit responsibly.\nOn the topic of high balances, another important factor is your credit utilization ratio, which accounts for 30% of your FICO® Score. This ratio indicates how much of your available credit you're using. Carrying a high debt load makes you appear risky to lenders, so it's usually advised to keep your total utilization below 30%.\nWhenever you add a new credit card to the mix, you increase your amount of available credit. As long as you maintain a low (or zero) balance on this new account, simply keeping the account open can help improve your credit utilization ratio, which can strengthen your credit score. If you ditch the card, your overall credit limit goes down. Depending on how much debt you carry on other cards, this could cause your credit utilization to spike and potentially harm your credit score. In other words, if you're actively trying to improve your credit, or you're planning to apply for a loan in the near future, keeping the account open could be beneficial. If your credit is already in great shape and you're not concerned about your utilization shifting drastically, then canceling may not impact you very much. END