I was forced to close American Express card last week and lately I've been thinking about closing all our retail store credit cards, we currently have:
Fry's Electronics - Got this card 4 years ago and I bought one item since then, a 22 inch Samsung LCD monitor. Card still active, credit line is $3,000, this one needs to go...
Best Buy - I can't part with this card!! I keep thinking I might need this one day... please convince me to close this account!!
Macy's - I won't even try, my wife loves Macy's and she will not give up her card, she gets all kinds of perks like free gift wrapping etc.
Roomstore - Look around for posts about this card, this one needs to go, there's no reason we should be financing furniture at our age.
So my goal for this week is to close the Fry's credit card and the Roomstore account.
I hope there's no impact to our credit scores since we will have closed 3 credit cards over the last couple of weeks.
HS
Menu Monday
3 hours ago
7 comments:
I would close them, but they say it does ding your report. I think that is completely unfair and another threat they like to hold over us. Cancel away!
I would close them all. I know the Best Buy is hard for you but why? Obviously you like the store and their products. Budget your cash when you want something. Don't charge it. You've already stated that you end up buying more when you charge. Now is the perfect opportunity to change! Also, I think your dog is drooling for more plastic. :)
I'm in the process of going credit-free, and am now saving for all of my major expenses. In order to save my credit score, I'm chopping up my cards, and closing them one every three months. (I'll keep the basic visa and mastercard open indefinetly to help my score though). All store cards will be gone though! OK, here's what I'm doing now. I set up Smartypig accounts.
You can check it out at smartypig.com. it's free direct-withdrawl savings accounts that are earning 3.25%! I'm saving $900 for my daughter's adoption finalziation--so I set up my Smartypig account and each month it will auto-withdraw $86 from my primary account and stick it in my "adoption fund." You might give it a try for electronics, or that elusive emergency fund we all know we should have but have a hard time establishing. They're having a $100 gift card contest on Twitter on the 20th. Give it a try.
I guess I see it this way...How badly do you care about your debt goals? Keeping these cards says "I'm only paying lip service".
Macy's and Best Buy are NOT needed to have around for emergencies. Having these does not help you get closer to your goals, in fact it hinders you because any spending on these will only take you farther from your debt goals unless it is in the budget already (in which case, why would you need to put it on a credit card?).
There is only risk in having these kinds of cards, because unlike regular credit cards, these are store-specific to stores that you won't be shopping at for an emergency. Keeping these only jeopardizes your goals, it doesn't help you reach them.
Hanging on to them is a crutch. Getting rid of them shows that you not only believe in your goals, but that you trust yourself to handle whatever comes without cards designed to help you live beyond your means.
My two cents - might be less with the exchange. ;)
I hang onto my Home Depot card because they often offer free delivery on appliances when the card is used. I just pay the card off right away. So maybe that's the excuse you need to hang onto your Best Buy card? Just don't carry a balance!
Well, I guess I am a bit of the odd ball here. I do utilize credit as a tool, but I also pay it off every month or before interest (best buy) and do not spend more then I plan. So, I would probably hold on to Best Buy - oh yeah, I am! I like that 90 days same as cash - been buying laptops for the kids college and need one more this summer.
The thing here is - will you fix the problem either way? If not, you are wasting your time, because when a want comes along you can just re-open and ding your credit again. Once on the out and once on the in.
What if, instead - you and the wife work out a deal - say "No Charging, unless the cash is in the bank to pay for it today."
By simply doing this, you stop yourself from spending tomorrows money. It isn't easy, but changing the way we think never is.
Also, I don't think there is a wrong answer, do what works for you.
Hi HS,
I was just wondering. You have a large amount in savings that can pay off all of your debt. Why haven't you done that? Just curious.
Sharon
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