So my question is, is there any negative to canceling that first, secured card? If I do cancel they will send me my $250 deposit back, which is cool because it's almost like free money. As it relates to building up my credit score, how does keeping and using/canceling that card affect things? Or does it?
I wouldn't hold that secured card anymore, unless it doesn't report itself as secured.
There will be a hit to the average age of credit lines and you'll lose that history, but that's not worth keeping a secured card - in my opinion.
What is far more important, if you're concerned about your score, is consistent payment history and total credit utilization. Rule 1 - keep your credit utilization to less than 50% - and that's much easier to do with a single card. Rule 2 - pay the credit card first - mortgage, student loans, lines of credit, you have to miss a couple of payments before they even raise a red flag (at least for most of them), but the CC companies are generally a lot quicker on the late payment ding to your credit report.
Hope this helps.
This post was edited on 3/24 at 9:53 am