Thursday, June 26, 2008

On Credit

I'm a strange girl who derives a perverse joy from cancelling credit cards in favor of shinier, new cards. So its with great pleasure (bordering on giddiness) that I link the latest addition to my wallet: The Simply Cash Card from AMEX.

Boasting an automatic 5% cashback on gas, office supplies and wireless services; this card is perfect for my everyday spending. It will be replacing my Chase Professional Master Card which has lesser rewards AND a ridiculous redemption system.

I'm a modern girl with modern expectations. Making phone calls in order to redeem points? Unacceptable. Having the company calculate my reward monthly and subtract it from the amount I owe? Exquisite.

Things to consider when effacing old cards:
1. Unredeemed Reward Points
You've accumulated points for using the card - make sure you get to use them even if it means keeping the card around for a billing cycle or two more.

2. How it will impact your credit rating.
I've had the Chase card for about a year and as its still considered new credit closing it will not have an adverse effect. Never close out your oldest card as it will automatically shorten the lifespan of your credit history. When possible assimilate your oldest card into a new one. This will preserve your longer credit history while allowing your credit report to look cuter. If this can not be done then request a credit limit decrease and use the card about once a year.

3. Listen for better closing offers.
Sometimes closing a credit card account is simple. The customer calls with the closing request, customer service counter-offers with some lame low-apr transfer. Customer scoffs. CS offers a higher credit limit. Customer is flabbergasted. CS to drop the apr. Customer is amused. Sometimes a customer will hit paydirt and be offered a gift card or bonus incentive to stick around. Feel free to take it and call back later to cancel the card.