Monday, August 2, 2010

Suck it, Credit Card Companies!

I just cancelled both my Capital One and my Target Visa cards today. Their combined credit limit was $7,500. That's keeping me out of trouble and giving me less accounts to keep track of. I've had the Capital One the longest, since 2002. I got it when I was 20, a junior in college. Honestly, I used it a ton over the years, loading it up and paying it off over and over again. (Well, it probably didn't have a zero balance too often actually. So more loading it up then paying it off.) It feels good to close the account, and close that chapter of having credit card debt in my life. Farewell, Capital One. And good riddance.

The Target card I got because I thought it was pretty. I kid you not. I was so lame financially. I also got Target coupons for using it, but really it was never worth it. I regretted opening it right away, and this one never had a huge balance on it. I didn't use it super often. Although I will say they were much more persistent in keeping me...she really tried to talk me into it, but I resisted. :)

I asked both companies to send a letter confirming that the accounts are closed. It feels good to have that taken care of!

So, the only card I have open now is my Credit Union visa card. I know some would say I should cancel that one as soon as I pay it off this week, but I do like having one credit card around for a dire emergency. Yes, that's what my emergency fund is for...but you never know and having the card makes me feel more secure. I have broken myself of using the card regularly, so I feel good about having it.


  1. Congratulations to you for closing the accounts and preparing to pay off your final card!

    I understand the last card is your financial security blanket. If you contue to follow Dave Ramsey's 7 Baby Steps you will have an emergency fund with a balance equal to some credit limits. At this point the debit card will be more powerful in an emergency than a credit card, because there is not interest to be paid for using your own money.

    I have been without credit cards for 3 years and I haven't had any emergency's larger than my emergency fund.

  2. congrats!!

    I would never advocate canceling ALL credit cards -- you should definitely have at least one. Sometimes you do need a credit card, like for hotel rooms or buying/booking things online. DO NOT CANCEL! =)

  3. in response to HITHATHSMYBIKE...A debit card can be used for hotel rooms, buying/booking things online, renting cars, etc. In the past 3 years I have traveled acrossed the US, internationally (Middle East, Caribbean & South America) and cruised a couple of times with a debit card. This goes to show that a credit card is not a NEED, but an option.

  4. I'm with hithatsmybike, I wouldn't close the last account. I've had things happen with my checking account online so I definitely think it's safer to use a cc online.

  5. Wow congrats! So awesome that you just went ahead and canceled those pesky cards. I've done stupid things like opening a store card just to get a 10% discount etc. We live and we learn. :-)

    I would say hold onto that last card as well. I agree with Broke by Choice, that you don't need a credit card. But you can never have too many safety nets right?

  6. Congratulations!

    Paying off the cards and closing them out puts another nail in the coffin of your debt.

    I personally wouldn't close out your last card UNTIL your emergency fund is at least a big as your credit line for that card, then CLOSE the card. You can do all the things a credit card can do with a debit card and you won't have to go into debt again.

  7. Except that when you cancel your cards, you cancel your credit history... And you need a credit history to get a mortgage or a car loan or even to rent an apartment. The longer your credit history, the higher your credit score. I'm not sure that this was as good of a move as you think. Sorry to be the bearer of bad news...

  8. It is a myth that you HAVE to have a credit card and a credit score to get a mortgage. Ask for a manual underwrite for you mortgage. The lender will then do what they actually used to do before credit scores. They used to actually DO THE WORK and research your history themelves! GASP! If you are being smart with your money, paying your bills on time, building savings, and you go in with a 20% minimum down payment, you should not have a problem. If you do, then find someone else to do business with. Don't give in to the Credit Score Conspiracy. It was created to help lenders, not you!