1. Overspending: Swiping your credit card may make you happy for a couple of days or months. However, this could also result in frustration once the bill arrives.Overspending is actually a sign to close a credit card. Holding on to an extra credit card just to make sure your credit score is good is not a very good idea.
2. Interest rate: You can always talk to one of the banking officials to negotiate a lower rate that might actually work out for your financial blueprint. If that does not happen, you must definitely consider closing the credit card. It’s not advisable to continue accumulating debt. Make a list of your credit cards according to interest rates and eliminate the one for which you are paying a lot of money.
3. Reward points: Reward points are one of the most attractive features of a credit card. It is as good as earning and indulging in extra money that’s available to you based on your purchases using the credit card. If the rewards scheme is working out very well for you then you must weigh your decision and continue to use the card. However, if you’re hardly making use of any reward points, it is better for you to close that credit card.
4. Debt: Credit cards with high interest rates may increase your debt. It is actually a sign that you should move as there is a high possibility that you may end up paying high fees. Also, increasing your debt with banks does not really favour your credit rating.
5. Fraudulent activities: If you have lost your credit card, it is always best to inform you bank. Also, if you notice some unauthorized activities, the best thing to do is to inform the bank and close your credit card immediately.