Use ‘em or lose ‘em: Keeping Your Credit Card Accounts Active

Lately, Credit cards issuers have been closing  inactive credit card accounts. This is partially due to the current credit crisis and sub-prime mortgage mess. With the tightening credit markets many credit card issuers have been stepping up the closing of  inactive accounts. This is because the inactive accounts are considered a risk to the lender and are not generating any profit for the credit card issuer.

If  you like many other Americans have a few credit cards lying around that you don’t use and that don’t have a balance (that’s a good thing) you may want to dust them off and make a few small purchases. Make only charges you know you can pay off right away.

This is really important if your account is one of the older ones you have or if all your other credit cards are near their credit limit.  The age of your account and available balances all tie into your all important credit score. That’s why maintaining an active line of credit on your credit card is important step to take.

So, in order to avoid having the credit card issuer close your account due to inactivity, dust off the credit card(s), make a small purchase or two and pay it off when the bill comes. Repeat this once or twice a year with all your credit cards and you’ll help to avoid having the lender close your credit account and thereby maintain your credit score.

While this is no guarantee that your account won’t be closed it does go a long way to showing you still intend to use the card and more importantly, have the ability to pay the bill when it comes.