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There are plenty of reasons why you may have wound up with a lot of credit cards in your wallet. Maybe a rewards program changed over time. Maybe your credit improved and qualified you for better offers. Maybe a sign-up bonus was too good to pass on. Maybe you opened and used too many cards straight out of college, but have since learned the errors of your ways.

Whatever the case, if you have a lot of credit cards, cleaning out your wallet can be easier said than done. Officially, closing a credit card could wind up hurting your credit score, and besides, that old hotel rewards credit card sure does come in handy when it’s time to plan your family vacation each year. So, you keep the cards in there but just don’t charge anything to them.

No harm, no foul, right? Until you notice that your credit score isn’t as high as you thought it would be. Is it possible you’ve reached a credit limit tipping point, even if you’re using your cards responsibly? Could all that unused available credit be holding you back?

Under the Limit

Credit utilization — how much debt you are carrying versus how much total available credit has been extended to you — is a major component of credit scoring models. For the best credit scoring results, it’s generally recommended to keep the amount you owe below at least 30% and ideally 10% of individual and collective credit limits. Anything over that threshold could lower your credit score.

Now, there’s an outside chance having too much available credit could ding your score down the road. The idea here being that, while those open, unused credit limits aren’t getting you into any trouble now, they could allow you to overextend yourself in the future.

But penalties for having too much available credit have grown less and less common in recent years, said Rod Griffin, director of public education for Experian.

“Credit scoring systems have evolved as consumer behavior has changed, and generally it is now a less important factor in credit scoring,” he wrote in an email. “Available credit is a factor in credit scores, but when it comes to revolving accounts, it is far less important than your utilization rate. So, today, having open accounts with zero balance is more likely going to help your credit scores, not hurt them.”


Brushing Up Your Scores

That’s not a guarantee, however, that all of your available credit isn’t hurting your score. To get a better idea of what may be bringing your score down, you’ll need to check your credit. (You can get a free credit report summary every month on Credit.com to see the major factors impacting your scores.)

If you do learn that having too much credit is one of your risk factors, you could consider closing a credit card that you never use. This may hurt your score in the short term, depending on what kinds of balances you are carrying on other cards, but, so long as your utilization gets back in line, it should rebound over time.

Remember, you don’t need to carry a balance on a credit card to build credit. But, if all these nuances have your head spinning, you can generally establish or improve your credit in the long term by paying all of your bills on time, keeping debts low and adding new financing only as your wallet and score can afford it.

And, if your score is in rough shape, you can generally fix your credit by disputing any inaccuracies (you can read more on how to dispute errors on your credit report here), identifying your credit score killers and coming up with a game plan to address them.

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