Personal Finance Buzz

Many financial advisers warn against canceling credit cards as it can lower the credit score by pulling up the credit card utilization rate. Although the FICO algorithm used to calculate the credit score is not fully disclosed, the general factors and their weighted effects on the final score are publicly known ever since. Card utilization rate is believed to be one of the sub-factors that can significantly lower the final credit score if it exceeds 30 or 35 percent.