Many people question whether they should close their old or unused accounts once they have paid off their debt. 

Many people have been told that keeping their accounts open will increase their credit ratings. However, this is always not the case.

Individuals who have paid off their debt should be very conscious of any and all accounts which they still have open. If you have an account open that you no longer are using, it is in your best interest to close the account immediately. (I’m talking from experience)

Many individuals are not aware of the exact terms and conditions of every account they have open. An account you opened up two years ago may not have had an annual fee, however, their terms and conditions could allow them to start charging an annual fee without giving notice to their clients. This means that an account you have open could begin racking up debt if a company were to start charging such a fee.

This is one reason why it is best to cancel any and all accounts which you no longer use.

Once your debt has been paid off you will want to start monitoring yourcredit report on a regular basis to insure that you continue to stay on the right path with your credit.

If you are an avid credit card user you should cancel all but one or two of your credit cards. Read the fine print and figure out which credit cards have the lowest interest rates and which ones don’t have an annual fee. Close all other accounts and just use the one or two cards that you have decided upon. However, never stop checking your credit and never stop reading the account information on these cards which you may receive in the mail. Note any changes to their terms and conditions to keep yourself and your credit safe from unnecessary charges in the future.

You should also take strict notice of other random accounts that you may have opened and may not use that don’t appear on your credit. Accounts such as gym memberships and even Video Store Cards. The reason being that a lot of these types of locations are now starting to charge annual fees which they can charge without notice. With that in mind you should really consider every time you have signed up for an account and contact those locations and inform them that you wish to cancel you accounts.

Like the old saying goes: It’s better to be safe then to be sorry.

So you’ve paid off your debt! Now is the time to protect yourself from falling into the debt trap again! Arm yourself with knowledge and make sure that you never find yourself fighting to get out of debt again.