Interesting... I never knew this. I'm glad that it didnt' matter in our case. Getting the mortgage was no problem and the credit is still as good as it was.
Actually I think we may still have one card open that never gets used, so
that may have helped.

I think cards are bad for out health. They out us in more debt than anything else in the world.

While credit seems to be an evil thing, especially when you're in debt (been there, done that), I believe it has a specific purpose in managing ones personal cash flow. That said, maintaining your credit limit at 50% might be cutting it too close for comfort. Anything higher than 20% of your limit and you can be sure you're spending too much on credit.

If you can pay off the debt and live off the balance until your next revenue comes in then by all means do so (that would be your Plan A). Otherwise, cut the debt up to 20% of your limit and place the remainder of your money on interest bearing accounts (combination of Plans B and C).

This makes sense, yes. I guess I should have known that before I closed
some accounts. Actually I think I just physically closed the one that
had an annual fee and the other I believe they talked me into keeping it
but switched it to no annual fee. In any case, I don't touch them now so
it all ends up the same.

SUCH SITUATION ARISES TO EVERY BODY.OPTION A IS ALWAYS BETTER.PAY ALL MONEY SO THAT YOU CAN BE FREE FROM INTERESTS.

why exactly would option A be better, i see no reason why one shouldn't go for opt B, pay back in 2 or 3 big chunks.. it should provide for better money planning once you allocate a certain amount to payin off debts, according to me..

Credit cards are unavoidable in current situations.There are lot of advantages of it.If used in correct manner within your limits then they are best monet saver.If used in other way they will be best money sucker.I t depends on users.

Unavoidable? I hardly think so. People lived without them for a few thousand years. Convenient, absolutely. But they require discipline to know when they are a benefit, and when you are digging a hole for yourself. If you can't afford to pay off the balance each month, you shouldn't be using them.

Too many of us (myself included) have thought of credit as our rainy day fund. It turns out that is a very bad idea. When credit cards are allowed to grow in debt, the tendency is to pay a small amount toward the balance each month. This habit gives us a false sense of security because, "I can handle the payment." But soon another emergency comes along and we are still paying off the last emergency! So when another card shows up in the mail, we kid ourselves into believing we have been rescued from our problems. But the problem has just begun as the debt piles up.

Soon we find a way to refinance everything, either through adding debt to our home or taking out a high interest (but lower payment) consolidation loan. Maybe we have to use the car as collateral, or get a co-borrower to sign with us. Now our short term unsecured debt has become long term secured debt...always bad idea, but sometimes our only choice.

My wife used to come home from a shopping spree excited about all the good deals she just got. But without cash, she just put everything on the store card. Anything she saved, she paid double for over the next several years paying off the balance. Today, the cards are gone, and so is the worry about the payments.

Yes, we need access to a good credit score. When we purchase our homes, a few points higher can be worth hundreds, even thousands of dollars. Applying for employment is sometimes subject to a credit check, as are life insurance rates and others. Some insurance companies even refuse to do business with people who have a low FICO score. So proper management of credit is crucial, not just a good idea.

Sorry, but I can't think of any way they save you money. Even the cash back rewards some cards offer, are just a portion of what they cost you to use. These guys are in business to make as much money as possible, not put money in your pocket.

Pay off the cards. Start saving until you have 6 months of salary in savings. Start easy with one month, then add another until you get there. Put the money in an account paying 5% or better and when that emergency comes along, you can pay for it with dollars that were working for you, not dollars that will be working for someone else.

i second this.. debt to beat debt without realising that its not one's own money that we are using here.. many people fall for this and that s the reson there are many credit cards out there in the market in the first place..

Thanks for your detailed reply.I too gain some informatives and third angle view about cards.