When to Switch Credit Cards and Closing Old Ones

A Quick Tip by Lynnette Khalfani-Cox, The Money Coach®

Taking advantage of an attractive new credit card offer, or a good balance transfer deal is often an excellent way to jumpstart your finances.

Ideally, switching to a card with a lower interest rate or transferring a balance from one credit card to another will shave your interest rate considerably, and lower your monthly credit card bills.

It can be wise economically to say yes to a low-rate or 0% credit card deal. Additionally, when done right, balance transfers can also help boost your credit score by spreading out your debts over multiple cards, so you’re not maxed out on any one card.

Why Take the Deal?

Here are some circumstances under which you should consider getting a new card or switching credit cards:

  • You have an offer for a credit card that features 12 months or longer in interest-free payments.
  • You’ve had past credit problems, rebounded a bit and now qualify for lower rates.
  • You receive cash back, travel rewards or other discounts on a new card that you qualify for and will use.

Despite any potential advantages, don’t close out old credit card accounts. This is a common mistake many people make during or after the balance transfer process. But closing credit card accounts can backfire on you by actually lowering your credit scores.

Part of the reason for the drop is that 15% of your credit score is based on the length of your credit history. So even if you’re not using an older card anymore, it may be best to keep it open and maintain a longer credit history. If you’re tempted to use it, consider cutting up the old card while still keeping the account active.


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Extra Credit provides general information to help improve our Member’s financial lives. Every situation is different, so please contact us for guidance on your specific needs. The advice provided in Extra Credit is not intended to serve as a substitute for speaking to a loan representative, financial advisor, or GreenPath Financial Wellness counselor who can help tailor a solution for you.

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