A popular method of curbing spending is
cutting up credit cards, but if you close those card accounts, your
credit score could take a hit.
A large part of calculating a credit
score is the consumer's credit utilization, or the amount of debt
compared to the amount of credit available. The higher a consumer's
credit utilization, the lower the overall credit score. By canceling
credit cards, the consumer has less credit available, so their credit
utilization shoots up and their credit score drops.
This “tip” should be common
knowledge to anyone with a credit card, but somehow, the myth still
lives on that canceling credit cards will help improve a credit
score. Just last week, U.S. News & World Report mentioned it in
their article “7 Weird Ways to Hurt Your Credit Score.” This is
exactly why My Credit Specialist offers credit education blogs,
videos, and other resources. Consumers clearly need this information.
We even did a video over a year ago on prevalent credit myths,
including why canceling a credit card lowers a credit score. These
tips might be news to the readers of U.S. News & World Report,
but our readers already have the tools to have a great credit score.
To keep up with the latest news and
credit education from My Credit Specialist, like My Credit Specialist on Facebook and follow My Credit Specialist on Twitter. Also, go to
http://www.mycreditspecialist.com
to find out if credit restoration is the right choice for you.
