When it comes to building and maintaining a strong credit score, time is one of your biggest allies. Many people assume that closing old credit accounts will simplify their finances—but doing so can actually hurt their credit profile. The age of your credit accounts plays a significant role in determining your overall score. Understanding why older accounts matter can help you make smarter financial decisions.
The Role of Credit Age in Your Score
Credit scoring models, like FICO and VantageScore, consider the length of your credit history as an important factor. It typically makes up about 15% of your total score. This includes the age of your oldest account, your newest account, and the average age of all your accounts. Older accounts demonstrate consistency and responsible financial behavior, which lenders view positively.
Why Keeping Old Accounts Open Helps
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Longer Credit History – A lengthy credit history provides lenders with more data to assess your reliability. Even if you no longer use an old card frequently, keeping it open can strengthen your score.
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Improved Credit Utilization – When you close an old credit card, your available credit decreases, which may increase your overall credit utilization ratio—a key component of your score.
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Demonstrated Stability – Lenders favor borrowers who have managed credit responsibly over time. A long, clean credit history signals trustworthiness and financial maturity.
When It’s Okay to Close an Old Account
While keeping old accounts is generally wise, there are exceptions. If the account carries high fees, poor terms, or encourages overspending, closing it might make sense. Before doing so, weigh the pros and cons and consider the potential impact on your score.
How to Manage Old Credit Accounts Effectively
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Use them occasionally: Make small purchases every few months to keep accounts active.
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Pay on time: Continue demonstrating positive payment behavior.
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Monitor for fraud: Old accounts can be targets for inactivity-related fraud; check statements regularly.
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Avoid unnecessary closures: Keep long-standing accounts open, especially those with no annual fee.
The Bigger Picture
Your credit history tells a story of your financial reliability. The longer that story—and the more consistent your payments—the stronger your profile looks to lenders. Closing old accounts may erase valuable chapters of that story.
Conclusion
Old credit accounts are more than just numbers—they represent trust and financial experience. By keeping them open, you maintain a longer credit history, lower utilization, and a higher score. In short, time truly works in your favor when it comes to credit health.
