How to cancel a credit card without affecting your credit score?

Paying off your credit card balance in full before closing your credit card is the best way to cancel your card.

You may have read elsewhere that keeping your credit card open even if you don’t use it anymore is beneficial to your credit score because it maintains the length of your credit history and keeps your credit utilization rate low. When you close your credit card, your average credit utilization may increase and the length of your credit history may decrease if it is one of your longest held accounts. This lowers your credit score considerably. The effect is higher especially if your credit history is short and your credit mix has just one credit card.

But, it may be necessary to close your credit card if you are going through a divorce, the credit card has high annual fees, or you simply don’t need it any longer. The effect of canceling your credit card can be offset by following good credit behaviors. A positive credit history on any credit card remains on your credit report for up to 10 years, even if you canceled the card. To offset your credit utilization rate, you can negotiate for a higher credit limit on another existing credit card so your average available credit is not affected.