People have credit cards for just about everything. If you have a Chevron credit card and are thinking about canceling it, you should consider what side effects that could have on you and your credit score. Read on to learn more about if it’s a good idea to cancel a Chevron credit card.
Why Do You Want To Cancel The Credit Card?
The reason you’re seeking to cancel a credit card is probably more important than whether you actually close the card or not. There are a few different motivations someone might have for closing their Chevron credit card.
For some individuals, it might be annoying or inconvenient to have so many different credit cards open. If you have dozens of credit cards with different companies, it can get difficult to keep track of all of them. Having too many cards can also make it harder to manage your accounts.
Some people could seek to close a Chevron credit card specifically because they no longer live near those gas stations. Chevron doesn’t operate everywhere. So if you’re not seeing them with any frequency, you might be thinking about closing the card.
Another group likely wants to close their Chevron card because it’s difficult for them to manage the temptation of having a credit card. Whether you’re using it at Chevron, or anywhere else, if having a credit card doesn’t work for you, it’s better to take control than let the card control you.
There are certain credit cards that charge a yearly fee just for having the card open. In this case, you would definitely be incentivized to close the account if you’re not spending enough to make the rewards worthwhile. The Chevron credit card, however, doesn’t charge an annual fee. You can read about Chevron credit card customer service at www.bills.com if you have more questions about the terms and conditions of the card.
While all these reasons have their validity, not all of them would really require you to close the credit card. If you don’t fall into any of these categories, and simply want to close the card to get it out of your life, you might want to think about potential ramifications before doing this.
Do You Know How It Will Affects Your Credit?
The elephant in the room when it comes to closing credit card accounts is determining how doing so will affect your credit score. Though it might not make sense why closing a credit card would hurt your credit, it can have that effect. These are the big factors that determine your credit score:
- Payment History – 35%
- Amounts Owed – 30%
- Length of History – 15%
- Credit Mix – 10%
- New Credit – 10%
The first place to look here is at amounts owed. No, closing your credit card account won’t lead to you owing more money. If anything it should do the opposite. But this isn’t the only factor that goes into determining this part of your score. The amounts owed score is how much you owe against how much you’re allowed to borrow in total. So, if you close a credit card that you’re not using much, it won’t increase the amount you’ve borrowed, but it will raise your credit utilization ratio nonetheless. A high credit utilization ratio can be a sign to lenders and credit agencies that you’re becoming a riskier lender, even if that’s not the case.
Closing a credit card can potentially hurt your credit score in other ways. If it was one of your first cards, it could shorten the length of your credit history. While this won’t apply to everyone, it’s worth considering. Furthermore, closing a Chevron card could affect your credit mix score.
Overall, there’s not much reason to close a credit card account unless you really have to in order to curb spending, or you’re paying an annual fee and not using it. Definitely think about how your credit might be dinged before closing your credit cards.