I have been told 50/50 on the unused credit card question some say to close all credit cards that do not have balances due to the potential spending you have. I was told that high amounts of potential credit is bad for your score, is this true?

This is one of those "it depends" type answers.

Generally speaking, having high available credit on your credit cards is good for your credit score. As a matter of fact, we correlated credit scores with how much of their credit line in use for our credit card utilization article. Lenders want to see you are responsible enough to not use all your limits.

In addition to the value of the high credit limits, your credit cards serve as credit history. Longer history is always better. We often see people lower their credit scores by cancelling old credit card accounts which contributed to their length of credit history.

The other side of the story is that too much available credit is not good because it can be seen as a risk. I know the two statements sound like a contradiction but as with many things, it is all about finding a healthy balance. You don't want to have $1,000,000 in credit limits on your credit cards but you also don't want to have just $1,000 either.

Our data suggests 3-6 credit cards are the average number of credit cards for users with good credit scores. If you find that you do want to reduce your total number of credit cards, try to keep one or two of the older ones around provided of course that they don't have high fees.

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