It is a very common myth in the consumer credit world that closing credit card accounts will have a positive effect on your credit scores. In most cases, exactly the opposite is true. This is because the percentage of your available credit in comparison to the debt you owe is an important factor in calculating your credit scores. This is called "revolving utilization," or your "debt-to-limit" ratio. When you close an account, the amount of available credit decreases, which could result in a higher revolving utilization and lower your score.
Also, if you close an account that has been open for many years, you may negatively effect your scores by lowering the average age of your credit history. This is another component that the credit-scoring model takes into account when calculating your scores. The older your credit history, the better.
It is not a good idea to close credit cards if you are trying to improve your scores. If you don't want to use a credit card any longer, simply stop using it. Don't close it.
Note: In today's rocky economy, credit card issuers are proactively closing credit card accounts that are unused or inactive. From a credit-scoring perspective, it's a good idea to periodically use your credit cards every few months just to keep them active. Charge something small like gas or dinner and then pay the balance when you get the bill. While it's no guarantee that the credit card issuer won't close your account, you're much better off with an active account (especially one that shows positive on-time payments) than with an inactive account which could get closed, thereby lowering your scores.
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