With all the talk about why credit cards should be avoided, especially for people whose credit history is questionable, I thought it might be a nice change to talk about the good that credit cards can do. Here are a few reasons not to get rid of every credit or charge card you have.

1. Charge cards with zero balances help build two things. They help you build a longer credit history, making you look more financially stable to potential lenders. The zero balance also helps to widen the debt to available credit ratio. The trick with paid off credit cards is to keep track of them—make sure that you aren’t incurring any annual fees and make sure that they have your current information.

2. In my post about saving money at the summer sales, I made not of the extra discounts that are often offered to people who have store accounts. There are plenty of department stores that offer customers a discount if they pay with the store’s charge card. This discount is often as much as fifteen percent! The best way to shop at these stores is to pay for your purchases with your charge card and then either pay the card’s balance with another cashier or to go home and immediately write a check for the amount you just spent and send it off to the charge company.

3. Some credit cards come with things like bonus points, frequent flier miles and cash returns. The best way to use these cards is just like the way you would use a store charge card. Use the credit card to pay for your purchase and then go home and immediately pay the balance. Often you can do this online!

4. By using your cards regularly (and paying them off regularly) you are building a positive credit history and increasing your credit score! Future lenders, when they look at your credit history will see how responsible you are with your credit cards and how quickly you pay your balances and be more likely to loan you money because you have proven that you are financially responsible.

5. If you start canceling all of your credit cards, when you look to purchase a car or a home later on, your lender might wonder why you were so hasty to close your accounts. If it looks like you don’t trust yourself, why would the banks trust you?

These are just a few reasons to keep your credit and charge accounts open. Obviously you know yourself and if you feel like the temptation of having available credit might be too hard too much then you need to follow your instincts. If, however, you feel like you’ve learned to handle your credit responsibly, you should think twice before you start cutting your cards and contacting the companies. Sometimes having credit available to you can be a great thing!

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