American Express forum. Talk about AmEx credit cards like Blue, Gold, Platinum, Centurion, and more.
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Moneytalks
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Should I get another card?

Postby Moneytalks » Wed Mar 21, 2012 2:55 pm

Im 20 yrs old and have:

Banana Rep.-$2,200 lim (3 yrs old)

Amex Green (less than 1 yr.)

Citi Divid- $4,000 (less than 1 yr.)

I want a USAA visa in place of the citi divid. Should I keep all the above and just apply for it, or should I let one of the cards expire and then apply??

(My scores are solid, and I don't plan on getting a mortgage or car loan anytime soon...)

Thanks for the advice! :)
Wallet: Amex BCE & Chase Freedom. (Credit Card dieting since 2014)


CC Deville
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Postby CC Deville » Wed Mar 21, 2012 3:55 pm

Moneytalks wrote:Im 20 yrs old and have:

Banana Rep.-$2,200 lim (3 yrs old)

Amex Green (less than 1 yr.)

Citi Divid- $4,000 (less than 1 yr.)

I want a USAA visa in place of the citi divid. Should I keep all the above and just apply for it, or should I let one of the cards expire and then apply??

(My scores are solid, and I don't plan on getting a mortgage or car loan anytime soon...)

Thanks for the advice! :)


You could really go either way on this. If you close the Citibank it really won't hurt your AAoA (Average Age of Account) wise because it isn't even a year old and since you are 20, you have many years to build up AAoA. On the other hand, you would be losing a $4,000 credit line which could hurt your utilization. Of course, USAA is known to hand out very healthy credit lines.

Does the USAA Visa card you are looking at offer rewards that suit you better than Citibank Dividend? If so, go for it. Otherwise, it may not be a bad idea to keep the Citibank card for the cash back when it suits you (ie bonus 5% on groceries, gas etc).

You don't have to wait for any of your cards to expire to close them. You may close them at any time. I will say this though: it is best to open accounts young and keep them as you age. I was 20 when I opened my Citibank Visa and I still have it. Looks pretty good when someone who is 33 has a 13 year old credit card in good standing on their bureau. Maybe that doesn't matter to you or other people on this board but I get off on it. And yes, you will be in your 30s someday and faster than you think. Just something to think about before you close a lot of accounts down.

JCarter
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Postby JCarter » Thu Mar 22, 2012 1:30 am

I wouldn't shut it, as you'll take a hit against your credit for the card being closed by customer. Just pay it off, and park it until you get where you want to be credit wise. I presume you want to trade up your American Express Green to a Gold fairly soon?

Moneytalks
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Postby Moneytalks » Thu Mar 22, 2012 8:55 am

@ CC Deville: The USAA Visa is pretty good compared to the Citi Div, but I guess I should just keep it like JCarter said and apply for the USAA. If anything, I'll close it if I get the USAA...and thanks for the words of wisdom, always appreciate free advice on life, especially since I have a ways to go :)

@ JCarter: I think I will keep it, and yes, you presume correctly, I hope to get Gold in a little bit, though I don't plan on traveling too much, so I think that's as high as I'll go.....for now at least....

Another question: If I do close the card, how many points we talking off my credit score???!!!
Wallet: Amex BCE & Chase Freedom. (Credit Card dieting since 2014)

CC Deville
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Postby CC Deville » Thu Mar 22, 2012 4:41 pm

Moneytalks wrote:Another question: If I do close the card, how many points we talking off my credit score???!!!


As long as you are approved for the USAA with an equal or greater credit line, you shouldn't take a hit on your FICO at all for closing the Citibank. You will take a hit for the new USAA account as well as for the credit inquiry.

Your Citibank account will report for 10 years after closing it, so your score would only take a hit after it falls off your bureau. And this is true; I had an old Associates Visa (long gone, Citibank bought them in 2000 or 2001?) anyway, I closed it in 2001 and last year it fell off my bureau, which lowered my AAoA and my score went down a few points. Not really a big deal. This year my old Fleet Visa falls off in April and I caluclated my AAoA...it would have lowered my AAoA from 9.1 years to 8.9...so I opened an Amex Zync in January-since I have been a member since 1999 my new Zync reports as being 13 and it raised my AAoA back up to 9.3 years.

So once the Fleet Visa falls off (it has been closed since 4/02) my AAoA will be 9.1 years again. So, again, not really a huge deal, but I like that I have a relatively old AAoA. Helps the score quite a bit as a big chunk of your FICO score is length of credit.

I stand by what I said though, I'd keep the Citibank.

Moneytalks
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Postby Moneytalks » Thu Mar 22, 2012 6:02 pm

Thanks CC Deville, I guess I'll go for it and then come back to the forum before I pull the trigger. Wish me luck :)

My only concern is that by opening the USAA, would I have too much credit available, as I will not be using much of it???
Wallet: Amex BCE & Chase Freedom. (Credit Card dieting since 2014)

CC Deville
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Postby CC Deville » Thu Mar 22, 2012 7:12 pm

Good luck, I hear USAA is a great bank to do business with. You won't regret it.

I wouldn't worry about having too much credit. You don't want to keep adding new cards, so having the Citibank, USAA and Banana Republic card won't be a big deal unless USAA and Citi both increase your limits to $50K which likely won't happen. Just be sure to use the cards every once in a while to keep them active and you shouldn't have any trouble.

amexguy321
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Postby amexguy321 » Fri Mar 23, 2012 9:47 am

is there such thing as "too much credit" ?? i feel like the more credit you have available paired with a long AAoA will always be good

Crashem
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Postby Crashem » Fri Mar 23, 2012 10:59 am

every time you get more credit, you score takes a hit from factors beyond the inquiry and AAoA hit. It recovers after a little bit assuming you don't abuse it. Eventually, it should help you more beyond the score itself. Depth and breadth of credit is a good thing. However, if your credit exposure gets to be a lot, banks may pull back credit during downturns as they did in 2008-2009 or if you have a personal downturn they discover (ie lost your job).

As for answer to the guy originally posting, I would recommend you keep any cards that don't have an annual fee because it will only help you in longterm.
Amex Centurion, Amex Platinum, Amex BCP 8k->24k (5/23/12), Amex TE 15k, Cap One 1.5% 15k->20k (8/7/13), CSP 25k, Chase Palladium 100k, Citibank AA 35k (AU), Firestone 1.8k->2.2k->2.4k (8/20/12), JFCU Jloc 30k, PenFed Plat Rewards 30k, SF Fire 30k, US Bank Cash+ 25k

JCarter
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Postby JCarter » Sat Mar 24, 2012 11:17 pm

Moneytalks wrote:Thanks CC Deville, I guess I'll go for it and then come back to the forum before I pull the trigger. Wish me luck :)

My only concern is that by opening the USAA, would I have too much credit available, as I will not be using much of it???


Per FICO there is no such thing as "too much credit" just "too much utilization".



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