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In the past seven years, my wife and I have opened 22 credit cards. Twenty-two!

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I know, it sounds reckless. But we are extremely responsible users. And we love chasing big welcome bonuses and playing the points game.

Thankfully, we also built a pretty good system for managing all those cards. And just as important, a smart strategy for knowing which ones to cancel without totally trashing our credit scores.

Here’s how we decide what stays and what goes.

1. Cancel cards with high annual fees you don’t use

Annual fees can be worth it if the perks pay you back in travel credits, cash back, or rewards. But if you’re holding a pricey card “just in case,” it’s time to rethink it.

Quick tip: Before canceling, I always ask if I can downgrade to a no-annual-fee version. That way, I keep my account open (helping my credit score) without the yearly charge.

If no downgrade option exists and the benefits aren’t justifying the fee, I cut it loose.

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2. Cancel newer cards first

Your credit score likes long-term relationships. That’s why I prioritize canceling newer cards over older ones. Closing a newer card does less damage to my average account age — more on that later.

Pro tip: Make sure you redeem any remaining points or cash back before shutting down an account. You don’t want to erase all those hard-earned rewards!

3. Cancel cards that aren’t rewarding anymore

If a card truly isn’t fitting your lifestyle anymore, it might be time to cancel it and swap it out. Choose a new top-rated credit card that pays you more.

Back when I first met my wife, we ate out all the time. Earning rewards on dining and restaurants was important back then because that’s where a lot of our spending went.

But now with two little kids, we barely make it out of the house. Grocery runs have replaced date nights — and so we see more value from grocery and gas reward cards.

Want to make your next card really count? Check out our list of the biggest sign-up bonuses available today — these can be worth hundreds in rewards.

How canceling a card affects your credit score

Your credit utilization ratio (the amount you owe divided by your total available credit) makes up about 30% of your credit score. And the average age of credit makes up about 15%.

Here are the two main risks when canceling a credit card:

• Lower total available credit: Canceling a card shrinks your available credit. This means your overall utilization ratio becomes higher and can ding your score.
• Shorter credit history: Older accounts lengthen your average credit age. While closed accounts might still show up on your report for a few years, eventually they drop off, which can hurt your credit score.

So before getting too trigger-happy with cancellations, be mindful of these important factors.

How many credit cards do you really need?

There’s no magic number, but for most people, keeping two or three solid cards covers all the bases. Here’s a solid setup:

1. Your oldest card: Preferably one with no annual fee, keeping your oldest account open preserves all that good history.
2. A top rewards category card: One that earns the biggest on your largest spending category — like travel, dining, or groceries.
3. A catch-all everyday card: A simple, flat-rate cash back card for all other purchases.

Arming yourself with these staple cards will ensure you’re ready to take on anything, from your weekly grocery store visit and gas fill-up to your next big tropical getaway.

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