Why Your Old Accounts Matter More Than You Think

When most people think about improving their credit, they focus on paying down debt or disputing negative items. While those steps matter, there’s another piece of the puzzle many people overlook: the age of your credit accounts.

Believe it or not, your oldest accounts can have a bigger impact on your credit score than you realize, and closing them could cost you more than keeping them open.

The Role of Credit Age in Your Score

Credit scoring models look at more than just whether you pay on time. One of the key factors is credit history length: how long you’ve been using credit responsibly.

This includes:

• The age of your oldest account.
• The average age of all your accounts.
• How recently new accounts were opened.

In short, the longer your credit history, the more data lenders have to judge your reliability. A 10-year-old account shows long-term responsibility, while a brand-new account doesn’t prove much yet.

Why Closing Old Accounts Can Hurt

It seems logical. If you’re not using an old card, why not close it? But here’s the problem:

1. It Lowers Your Average Age
   Closing a long-standing account shortens the overall length of your credit history. This can knock points off your score.
2. It Shrinks Your Available Credit
   Closing accounts reduces your total available credit. If your balances stay the same, your utilization ratio (the percentage of credit you’re using) jumps, which can hurt your score even more.
3. It Removes Positive History
   That old account you’ve managed well for years? It’s proof you can handle credit long-term. Closing it makes that history less influential over time.

When It Might Make Sense to Close an Account

There are situations where closing an account is the right move:

• If it carries a high annual fee and you’re not using it.
• If it tempts you to overspend and keeps you in debt.
• If it’s tied to an old joint account you no longer want linked.

But even then, it’s often smarter to downgrade the card to a no-fee version or keep it open with minimal activity rather than closing it outright.

How to Make Old Accounts Work for You

• Use them occasionally. A small charge every few months keeps the account active.
• Set up auto-pay. Pay the balance in full to avoid interest but keep the history alive.
• Monitor regularly. Make sure the account reports correctly to all three bureaus.

Final Thoughts

Your oldest accounts are like your financial roots. They anchor your credit history and strengthen your profile. Closing them may feel harmless, but it can quietly undo years of progress.

At CreditNerds.com, we help people understand the “hidden rules” of credit so they can build stronger scores without unnecessary setbacks. Before you cut ties with an old account, make sure you understand what it’s really costing you. Schedule your free consultation today.