Last month I posted Too Little Debt, in which I discussed how a zero balance credit card bill is actually a negative to your credit score.
Today, I’d like to offer another aspect of your credit score – the Average Age of Open Credit Lines. Here, longer is better. This is one criteria that I really object to. Think about it, a card issuer decides to raise their rate or annual fee and you decide to get a new card from a different bank. If you had only that one card, you may be dropping your average time from many years right down to zero.
You can see from this chart, a snapshot from Credit Karma, that offers a view of the image of account age on your credit score. So, find a credit card or two with no fee and stick with it. Keep in mind, it’s simple math, if you have a few credit lines, adding a new one will have less impact on average time than if you only had one. You are also far better off canceling a more recent line than one that’s older than your personal average. How old is your oldest card?