should I close old unused credit cards?

[Cubswin]

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the best thing you can do for your credit(borrowing ability) is to build up your net worth. that should be everyones goal. not to build up credit so you can borrow more.but you sound like you are doing the right thing. but close accounts you dont use. nowadays with identity theft. it is easier to get you the more stuff you have open. and if it happens hard it takes a long time to get it straightened out.

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No offence RZ, but I think the advice you offer here is wrong.

1) From my understanding, your salary, employment history and credit score play a much bigger role in your borrowing ability than your net worth, at least if we are talking obtaining something like a mortgage. While a high net worth may help you with a larger down payment for a house, thus reducing prinical, I dont know that it will affect your ability to obtain a lower interest rate on a loan.

2) Closing accounts you dont use is not a wise plan of action. In some cases it might lower your credit score which could make obtaining lower interest harder.

3)The whole notion of identity theft is way overblown. There are a few cases where it has wrecked havoc on peoples lives, but these cases of identiy theft are more the exception than the norm. Speaking from experience, cleaning up your record after personal information has been compromised is quite easy. You simply report to one credit bureau, they send you a free credit report for review and any anomolies are then reported to the other two bureaus for you. I am of the opinion that the credit card companies and the credit bureaus use idenity theft as a marketing scare tactic so they can sell their credit monitoring services.

[Ray Zee]

i dont see how i am wrong but you can argue your way is better. if anyone thinks that you should put more effort into building other things than your net worth i cant understand it. a big salary and great employment history and no money in the bank is not the way to go.
lenders look for the willingness and ability to make payments on a loan. net worth is a primary consideration. especially when borrowing from local sources which is what you tend to do when doing projects to advance yourself in life. not borrowing for consumer goods which i know nothing about as thats what has americans in all this financial trouble.
they do value credit score numbers alot and use them for determining rates in cases where they are low. but they also look at open lines of credit. because they know if you use them to the limits and then cant pay you are also in trouble with their loan. the computers dont think but the guy signing the check for you does.
ill buy you a turkey dinner if you go to a bank and ask the loan manager who he is more likely to give a loan to. the guy with a higher score or the guy with a bunch of money in his account sitting there. and he says the credit score.

[leftcoast72]

I agree w/ both Ray and Cubs here, to an extent. Your credit score is the more valuable of the two in terms of getting loans. Net worth is obviously the 'end game' goal, so ultimately, the first serves the second.

A good credit score is a basic building block of accumulating wealth, since it allows you to obtain other people's money, for cheap, to use for good (instead of evil). If you're utilizing credit for consumer products, food, etc, then obviously you're on the wrong path. But, if you're using opm's for strategic investments, that grow YOUR net worth, then a good/great credit score is invaluable.

And, as for closing unused cc accounts, I disagree completely unless they are young, dept. store cards that serve no purpose. I have made a concerted effort over the last few years to increase my credit limits as much as possible, on select cards. Why? It's cheap, easily accessible short term money. Not money to be used on that plasma tv, but money to be used for short term investments. I can negotiate a good rate on the phone or online, and the money is in my account practically instantly. Now, as rates have increase, 1-2% may be a thing of the past, but 5-7% is there for the asking.

I have multiple cards, <25% utilization, with combined limits totaling mid-six figures and my current score is 750. When the balances are closer to zero, my score will jump to the low 800's. Available credit is not a significant hinderance to credit score, in my experience. Low utilization, timely payments, length of credit history and no derogatory items are the big guns. Make those payments, keep the cards open, don't use over 50% of the limit and you should be fine.

Just my $.02, though