If you have multiple bank credit cards, it can be difficult to manage them. Remember bill date, pay bill on time, redeem point etc. Sometimes we close one or two credit cards to get out of this mess. If you are also worried about many credits and want to close it, then it is very important for you to keep these five things in mind.
1. Pay the outstanding bill in full
Before closing a credit card, it is extremely important to clear all outstanding bills as these attract interest. If you are late in paying your dues, you will also be fined. Therefore, before closing the credit card, make sure to pay all its outstanding bills.
2.Stop AutoPay Payment First
Before applying for the closure of the credit card, stop all auto payment payments associated with it. Many times it happens that the credit card holder may have a subscription to Netflix or other such platforms, or they may also be paying EMI and other bills with the card. These payments do not stop automatically once you initiate the credit card closure process. This can damage the credit score.
3. Close the new card, keep the old one
While closing a credit card, it is also important to consider the usage time of the card, as the age of the credit account has a major impact on the calculation of credit score. The older the credit card, the higher its contribution to the credit score. So always try to close new credit cards.
4. If you want to take a loan, then avoid closing it
Financial experts say that if you want to apply for a big loan, then do not close the credit card. Closing a credit card can affect your credit score. If the score is low, you may have to pay interest at higher rates on the loan.
5.East redeem the points on the card
Credit card offers are its reward points which can be redeemed through cashback, discounts, coupons etc. Many a times many people do not keep track of their reward points accumulated over a long period of time. That’s why you should use them before closing your credit card.
