When Emily decided to close her oldest credit card, she thought she was freeing herself from an unused account with an unwieldy annual fee. Within days, however, her credit score dipped by nearly 25 points, jeopardizing a home refinance she had scheduled. This real-world setback underscores a vital lesson: closing your longest-held account can carry unexpected consequences.

Before you swipe “close” on that decade-old card, consider the hidden mechanics driving your credit score—and why your oldest account is often your strongest ally.

Real-World Scenario: A Costly Mistake

Imagine you have three cards: Card A open for five years, Card B for ten years, and Card C for two years. Your average account age sits at 5.7 years. Close Card B, and that average plunges to just 3.5 years. That sudden shift could shave points off your score, affecting loan approvals and interest rates.

Even more striking, when you eventually lose the closed card from your report—typically up to ten years after closure—its weight on your credit history vanishes entirely, and your score may dip again.

Understanding the Role of Account Age

Account age makes up about 15% of your FICO score. Two metrics matter:

• Oldest account age: How long your longest-standing card has been open.
• Average account age: The mean age across all your accounts.

When you close a card, you don’t just lose its future benefit—you reduce the average account age of your cards immediately, which your score reflects at once.

Credit Utilization Ratio and Your Score

Your credit utilization ratio—the share of credit you’re using—accounts for another 30% of your FICO score. It’s calculated as total balance divided by total credit limit. Keeping this figure below 30% is ideal.

Closing a card reduces your credit limit, often raising your utilization rate even if you don’t increase your spending. For example, with $20,000 in total limits and $5,000 in balances, your utilization is 25%. Close a $5,000-limit card, and your utilization jumps to 33%, potentially triggering a score drop.

Short-Term vs. Long-Term Impact

In the short term, you may see two effects at once:

• A higher utilization ratio due to lower available credit.
• An immediate reduction in your average account age.

Over the long haul, your closed account remains on your report—along with its positive payment history—for up to ten years. Once it falls off, you lose its entire age contribution, creating a secondary score dip if you haven’t compensated with new, well-managed accounts.

When Might Closing Be Justified?

While keeping your oldest card open is generally best, there are situations where closure or action makes sense:

• High annual fees outweighing benefits.
• Temptation to overspend and accumulate debt.
• Security concerns like fraud or identity theft.

Even if you decide to close, explore alternatives first—such as downgrading to a no-fee version to preserve both your history and credit line.

How to Make an Informed Decision

Follow these steps to weigh the pros and cons:

• Identify if it’s truly your oldest account or carries a large limit.
• Estimate your new utilization ratio after closure.
• Consider occasional use to keep the card active and in good standing.
• Evaluate alternatives like downgrading rather than closing outright.

By calculating potential score changes in advance, you can avoid surprises.

Debunking Common Myths

Myth: “Close a card and its history disappears immediately.”
Fact: payment history remains on your report for up to ten years, helping your credit until then.

Myth: “Unused cards are worthless.”
Fact: Even dormant cards contribute valuable total available credit across all cards, helping keep your utilization low.

Expert Advice

“You want to keep that oldest card open. If you want to close it just because it doesn’t offer enough rewards, don’t... To keep it active, use it occasionally and keep the balance paid off.” — Jason Decker, travel rewards consultant.

“Contrary to popular myth, you don’t lose the value of the age of the card simply because you close it.” — John Ulzheimer, credit expert.

Summary of Credit Score Factors

Actionable Steps to Protect Your Score

Don’t rush into closing without a plan. Instead:

• Review your credit report regularly for accuracy.
• Estimate your score impact before making changes.
• Pay down balances to keep utilization low.
• Consider downgrading high-fee cards instead of closing.
• Use your oldest card sparingly to keep it active.

Conclusion

Your oldest credit card is more than an outdated account—it’s a cornerstone of your credit profile. By understanding the long-term consequences of closure, you can make informed choices that preserve your score’s strength.

Before you hit “close,” explore alternatives, weigh the facts, and protect the stability you’ve built over years of responsible credit use.