Blog » Community » If My Credit Card Balance Is $0 Should I Close the Account?

If My Credit Card Balance Is $0 Should I Close the Account?

The standard recommendation is to keep unused accounts with zero balances open. A zero balance on a credit card reflects positively on your credit report and means you have a zero balance-to-limit ratio, also known as the utilization rate. Generally, the lower your utilization rate, the better for your credit scores.

Closing the accounts reduces your available credit, which makes it appear as if your utilization rate has suddenly increased. An increase in your utilization rate is a sign of risk, and may result in a slight dip in credit scores.

From a credit scoring standpoint, you may want to keep the account open and make a small purchase once a month. You can pay the amount off immediately so that you aren’t carrying debt and the activity on the account will demonstrate that you can manage credit and keep your utilization rate low.

If you don’t use the card and have a strong credit history and credit scores, closing the account likely won’t have a significant impact on your credit scores. Keep in mind, if you are planning to make a major credit purchase in the next three to six months, it’s best to leave the account open.

Each scenario is different. Look at your overall financial picture and make a determination based on your own situation.

Learn more about how utilization rates affect credit scores.

Check out the scope to hear answers to all the questions asked:

View scope.

Do you have questions about credit?

Join our live video chat every Tuesday and Thursday at 2:30 p.m. ET on Periscope. Rod Griffin, Director of Public Education at Experian, is available to answer your questions live.
Scoped on: 12/30/2016

Review Your Free Experian Credit Report Today

Good credit begins with knowing where your credit is today. Get started with your free Experian Credit Report, updated every 30 days on sign in. No credit card required.

Get Started for Free

Credit Education

Credit Cards & Loans

Get credit cards and loans from our trusted network of partners. See credit offers based on your credit when you sign up for free.

Browse Credit Cards & Loans

Here’s How Much Your Personal Information Is Selling for on the Dark Web

The dark web is a huge marketplace for stolen data and personal information. Find out how much your information is selling for on the dark web.