Should I cancel an existing credit card so I can open another that has rewards?
Cancelled cards don't fall off the system for a long time, up to ten years. Card terms change, with notice of course, but it can happen at any time.  I had a card with a crazy perk, 5% back in Apple Gift cards. This was pre-iPod days, but it was great to get a new computer every two years for free. But it was short lived. Three years into it, the cards were changed, a no-perk card from the bank. That is now my oldest account, and it goes unused.  Instead of holding cards like this, I wish I had flipped it to a different card years ago. Ideally, your mix of cards should provide value to you, and if they all do, then when one perk goes away, it's time to refresh that card.   This is a snapshot from my report at CreditKarma. (Disclosure, I like these guys, I've met their PR folk. I have no business relationship with them) Elsewhere on the page it's noted that average card age is a 'medium impact' item. I am 50, but I use the strategy above to keep the cards working for me. My current score is 784, so this B on the report isn't hurting too much. The tens of thousands I've saved in mortgage interest by being a serial refinancer was worth the hit on account age, as was the credit card with a 10% rebate for 90 days, the 'newest account' you see in the snapshot.  In the end, the score manipulation is a bit of a game. And some of it is counter-intuitive. Your score can take a minor hit for actions that would seem responsible, but your goal should be to have the right mix of cards, and the lowest interest (long term) loans. You're right to keep the oldest one.  That's an asset to your credit rating. Since you're already responsible with your credit, a dip in your credit rating doesn't really matter unless you're looking for another loan, like a mortgage. I personally like the cash-back rewards because they're the most flexible, so you have a good thing going with that card. Do those reward cards give you perks on all of your purchases?  If they do, then look carefully to see if you can do noticeably better with another card.  If not, it may not really be worth it. Regarding cancelling one of the cards, I wouldn't, and here's why.  Your cards can get compromised, and sometimes more than one gets compromised at the same time.  I was glad that I had three cards, because two of them got hit the same day.  Hence, having three cards hit on the same day is possible, and you'll be glad that you have the fourth. Hits to your credit rating for canceling one of the newer cards will be a small hit for a few months.  You do have some options.  I also believe that a person with good credit should have multiple cards: I like having a cash back card for the majority of our transactions. Unfortunately that card isn't accepted everywhere, so I have two other cards with broad market coverage to make sure we always have an option if the vendor doesn't take the main card.  Also having multiple cards makes sure that if there is an issue with one card you are never caught without a card. One time the main card was rejected by a gas station because my wife just used the same account to buy gas across town. When we got home their was a fraud alert message on our phone.
Get a credit card is NOT the answer. The reason people have a bad (or no) credit score is often because they're new to the country, have just turned 18, have previously fallen into arrears or are just bad with money. Getting a credit card is risky because, if you don't stay on top of your payments, it'll just damage your score even more.  Now, it sounds like I hate credit cards - but I don't, and they do have their benefits. But avoid them if possible because they can be more hassle than they're worth (ie, paying the credit back on-time, cancelling accounts when the interest comes in, moving money in and out of accounts). It's risky borrowing money from anywhere whether it's a payday lender, a bank, a credit card, etc., so use them as a last resort. If you've got your own income then that's amazing!, try not to live outside of your means and your credit score will look after (and increase) itself. It takes time to build a good credit score, but always make sure you pay the people you owe on time and the full amount. I'd stick with paying your phone provider (and any other direct debits you have setup) and avoid getting a credit card. I'd recommend Noddle to keep track of your credit score and read their FAQ on how to help build it. Unlike Experian, it's free forever so not quite as detailed... but Noddle are owned by CallCredit - one of the biggest Credit Reference Agencies in the UK so they should have the latest information on yourself. In conclusion, if you already have financial commitments like a mobile phone bill, gym membership, store cards, anything that gets paid monthly by direct debit... your credit score will increase (provided you pay the full-amount on time).   I hope this helps. PS. I don't work for any of the companies here, but I've been working in the finance sector (more specifically, short-term loans) for 3+ years now. "Are you on Twitter? If so, the first thing I'd do is tweet this question to @Orbitz and/or @AmericanAir (AA). I'll edit it to be a bit nicer english-wise.  Tweeting (or Facebooking or Instgramming or ...) is one of the most effective ways to get customer service in 'edge' cases.  Explain your case in a nice, tight narrative that has the pertinent facts, why you should get an exception.  Social media tends to get results that you can't get just talking on the phone; in part because you're effectively talking with a higher-up person, and because you can make your case a bit more clearly. You can actually tweet this StackExchange question directly, or word it yourself in a tweet/FB post/etc.  On Twitter i'd link to here or somewhere else (too short), with something like ""@Orbitz @AmericanAir, you changed our trip and now it doesn't work with our special needs child.  Any way you can help us out? [link to this q or a blog post somewhere]"".   As far as a merchant dispute; it would realistically depend on the agreement you signed with Orbitz when you bought the tickets.  Likely it includes some flexibility for them to change your plans if the airline cancels the flight.  If it does, and they followed all of their policies correctly, then technically you shouldn't dispute the charge. It is possible that Chase might have some recourse on your behalf, though I don't think this qualifies for Trip Cancellation Insurance (Which you have through your Sapphire card ).  It might be worth calling them, just to see.  In the future, I would recommend booking through their site - not only do you get 25% bonus rewards when you use miles through there, which often is enough to offset the advantages of discount travel sites, but they're quite good at helping deal with these sorts of problems (as Sapphire is one of their top cards)." The first thing I assess when looking at new credit cards is whether it has no annual fee, the second thing I look at is how long the interest free period is. I always pay my credit card off in full just before the due date. Any rewards program is a bonus. My main credit card is with CBA, I have a credit limit of $20K and pay no annual fee. I get a bonus point for every $ I spend on it, for which I exchange for store gift cards to help with my everyday spending. Approximately 3500 point would get me a $25 gift card. But my main reward with the card is the interest I save by keeping my own money in a Home Loan Offset account whilst I spend with the Bank's money. Then I pay the full amount off by the due date so I do not pay any interest on the credit card. I only use my credit cards for purchases I would usually make anyway and to pay bills, so my spending would be the same with or without a credit card. I can usually save over $500 each year off my Home Loan interest and get about $350 worth of gift cards each year. If I didn't have any Home Loans then I would keep my money in a high interest depost account so I would be increasing my interest payments each year. Sure you can probably get credit cards with more generous rewards programs, but how much are you paying each year in annual fees, and if you don't have an interest free period and you don't pay off all the amount due each month how much are you paying in interest on the card? This is what you need to way up when looking at rewards programs on offer. Nothing is for free, well almost nothing ! "Yes, it can be a good idea to close unused credit cards.  I am going to give some reasons why it can be a good idea to close unused accounts, and then I will talk about why it is NOT necessarily a bad idea. Why it can be a good idea to close unused accounts ""I'd like to close the cards.""  That is reason enough.   Simplifying your financial life is a good thing.  Fewer accounts let you focus your energy on the accounts that you actually use. Unused accounts still need to be monitored for fraud. You mentioned that you have high credit card balances that you are carrying.  This may indicate that you have trouble using credit responsibly, and having more credit available to you might be a temptation for you. If these unused cards have annual fees, keeping them open will cost money. Unused cards sometimes get closed by the bank due to inactivity.  As a result, the advice often given is that, in addition to not closing them, you are supposed to charge something to it every month.  This, of course, takes more of your time and energy to worry about, as well as giving you another monthly bill to pay. Why it is NOT necessarily a bad idea to close unused accounts Other answers will tell you that it may hurt your credit score for two reasons: it would increase your utilization and lower your average account age.  Before we talk about the validity of these two points, we need to discuss the importance of the credit score. Depending on what your credit score currently is, these actions may have minimal impact on your life.  If you are in the mid 700's or higher, your score is excellent, and closing these cards will likely not impact anything for you in a significant way. If you aren't that high in your score yet, do you have an immediate need for a high score?  Are you planning on getting more credit cards, or take out any more loans?  I would suggest that, since you have credit card debt, you shouldn't be taking out any new loans until you get that cleaned up.  So your score in the mean time is not very important. Are you currently working on eliminating this credit card debt?  If so, your utilization number will improve, even after you close these accounts, when you get those paid off.  Utilization has only a temporary effect on your score; when your utilization improves, your score improves immediately. Your average account age may or may not improve when you close these accounts, depending on how old they are compared to the accounts you are leaving open.  However, the impact of this might not be as much as you think. I realize that this advice is different from other answers, or other things that you may read online.  But in my own life, I do a lot of things that are supposedly bad for the credit score: I only have two credit cards, ages 2.5 and 1.5 years.  (I closed my other cards when I got these.)  My typical monthly utilization is around 25% on these cards, although I pay off the balance in full each month, never paying interest.  I have no car loan anymore, and my mortgage is only 4 months old.  No other debt.  Despite those ""terrible"" credit practices, my credit score is very high. Conclusion Make your payments on time, get out of debt, and your score will be fine.  Don't keep unwanted accounts open just because someone told you that you should." Closing the card will be fine. The consequences are related to your available credit and actual/potential utilization. If you have less total credit, any credit you actually use will be a greater percentage of your total credit, manipulating your score downwards more greatly. The next consequence will be related to the age of your credit history, which is an average of your credit lines. This seems negligible and also beneficial for you, since your credit history is so young to begin with. Discipline. If you have to have a hard limit on your account that prevents you from spending - credit cards are not for you. If you can discipline yourself not to make purchases in excess of your budget even if the plastic technically allows it - then you can go on using the credit card. Make sure to stay on top of your spendings by frequently checking your current activity on the card (on line, don't wait for statements), and making sure you're below the limit you have set for your budget. Mint.com visualizes your spendings and shows where you are with regards to your preset budgets on various types of spendings, you should consider using it as an aid. Rule of thumb, the earlier you pay down your balance, the less interest you will accrue and the faster you will pay off the debt as a whole. But lets play with some real numbers here.  You cited $5000 balance and a $750 payment, but with various bills and things adding onto the balance over the course of a month. Now if your purchases and payments add up to the same number, you are in a losing game, so for the sake of argument I am going to say you are putting $500 + interest on the card each month and making a $750 payment.  We also need an interest rate to work with, I am going to use 1%/month and 30 day months to keep the math a bit easier to follow.   You basically have two choices in this scenario, you can pay 750 a month on the card, then use it to make your $500 in purchases/other payments over time as you suggest in your question.  Or you can pay $250, and hold back $500 to make those other payments directly without running them through the card, as has been suggested in some other answers. So let us compare the two... If I start the cycle at $5000, make a $250 payment on the first day of the cycle, then have no other activity, I will have a balance of $4750 for the month and accrue $47.50 in interest at the close of the cycle.  Balance going into the next period is now $4797.50.  Carry this out for a year, and your balance at the close of the 12th cycle is $2431.79, and $431.79 of your payments went to interest. By contrast, if you pay $750 at the start of the month, then add $100 back every 6 days so that you spend $500 over the course of the cycle. You will have an average daily balance of $4466.67, which results in $44.67 in interest charges being accrued at the end of the month.  This gives you a balance of $4794.67 going into the next cycle, putting you about $3 ahead of the previous method.  Push this pattern out for a year and your ending balance is 2395.86, with 395.86 going to interest.  Resulting in a savings of ~$36 over making the smaller payment and paying cash for your other expenses.  If this happens to be a rewards card, you also have gained whatever rewards benefit it gives you. This demonstrates that by the strict numbers game, the scenario you propose should come out a small but measurable distance ahead of making a smaller payment in order to avoid putting things back on the card.  So why do so many people adamantly advise you to not do this?   Most of it has to do with psychology and risk.  The cash method does not leave any room for you to over spend.  You have shredded or locked up the credit card so it can’t be used casually, and when you run out of cash, you can’t spend any more.  Which forces you to pay much closer attention to where your money is going.   When you are running things through the credit card, you generally don’t have that hard stop unless you are up against your credit limit, and even then most issuers are quite happy to let you go over and charge you extra fees for doing so.  So if you have this plan where you are intending to put $500 on the card in a month, then lose track of something you did early in the month, and inadvertently spend $800, you are digging yourself deeper into the hole instead of climbing your way out. There is also a risk in terms of income loss.  In the cash method, you no longer have the money to spend, and you are forced to make the hard decisions about where to allocate what you do have, making you much more likely to cut back on luxury items to preserve the necessities.  In the card method, it is easy to say “eh, the card has room, I can catch up again later” and not realize the mess you are causing yourself until you are in way over your head.  I personally have run all my bills through a credit card in the past so that I could have one single payment to make.  Then I was unemployed for six months, and ended up moving before I found a new job.  Everything in between, including the move, went on the card.  Next thing I know I am carrying a balance of $15k where I used to always have it paid in full.  It took roughly 10 years, including several years of working strictly in cash, to get that back under control. I currently have a card that is carrying a balance, and I am running select expenses (such as fuel and food) through it while I whittle the balance back down.  Most of my main bills are still paid directly from cash, specifically so that I don’t fall back into the same trap I did before.  Even so, there were several months in the past year where the balance was creeping up instead of down, because we were not paying that close of attention to our spending.   Then my wife lost her job, and it forced us to closely evaluate where our money was going.  We still run certain things through said card, but we are much stricter about it being only those select things, and the balance is trending down again.  The main reason we are still channeling those expenses that way is because this is a cash back reward card, and we will be getting roughly $1000 back here in a couple more months. If you had a CC issuer that allowed you to do bill-pay this way, I suspect the payment would be considered a cash advance that will trigger a fee and a pretty egregious cash advance specific interest rate.  It's not normal for a credit payment portal to accept a credit card as payment. If you were able to do this as a balance transfer, again there would be fees to transfer the balance and you would not earn any rewards from the transferred balance.  I think it's important to note that cash back benefits are effectively paid by merchant fees.  You make a $100 charge, the merchant pays about $2.50 in transaction fee, you're credited with about $1 of cash back (or points or whatever).  Absent a merchant transaction and the associated fee there's no pot of money from which to apply cash back rewards.