A disorganized wallet makes it hard to find the things you need, so it’s a good idea to periodically get rid of crumpled business cards and faded receipts. With those things out of the way, you can look at the rest of your wallet’s contents with a more critical eye.
This spring, while you’re dusting off high shelves and ceiling fans, take a moment to freshen up the items in your wallet, too. It’s a relatively quick task that can save you money. Those old credit cards you no longer use may be charging you annual fees. Perhaps you still pay for a membership to a wholesale club, but haven’t shopped there in a long time. (Plus, if you still have some unused gift cards left over from the holidays, you’re sitting on a gold mine.)
Don’t let that overstuffed wallet intimidate you. Here’s how to pare it down.
Clean up your credit
Credit cards are actually pretty germy, so it doesn’t hurt to literally clean them. After you do that, consider if each card still deserves a coveted spot in your wallet.
Evaluate whether a card is still a good fit
Your needs change over time, and your credit cards should keep up. There are lots of reasons you might want to make a switch:
You’re ready to graduate from a secured credit card to an unsecured card.
Your travel habits have changed, which affects the type of rewards card you’ll apply for.
You opened a credit card with a 0% interest promotion to make a major purchase or pay down debt, but you’ve paid off the balance and the no-interest period is over.
Another credit card is offering a compelling welcome bonus.
Your spending habits have changed.
You no longer want to pay an annual fee for a card.
You have a few options if you’re ready to change your card, but think twice before canceling and reaching for the scissors. Keeping an older credit card open and using it sparingly affects the average age of your accounts, which is a factor in your credit scores.
“In my mind, if there’s no annual fee, just keep it open,” says Nick Marino, a certified financial planner in Columbus, Ohio.
If you’re paying an annual fee on an old card you don’t use, call the credit card company to see whether there’s a no-fee card they can transfer your account to. This allows you to keep your account open at no cost. If that’s not an option, canceling the card to avoid the annual fee could be a money-saving move — and might be worth any temporary ding to your credit scores.
Look into lowering interest rates
The average APR charged for credit card accounts that assess interest is 22.75%, according to the Federal Reserve. At that rate, your existing credit card debt could be costing you a substantial sum every year. Applying for a balance transfer credit card and moving your debt over to it can give you a promotional 0% interest rate for a long time — often a year or more. This can save you money on interest payments while you pay down debt.
Review credit reports
This is also a good time to check in on the general health of your credit history. Get your free credit reports from annualcreditreport.com and make sure the information listed in them is accurate.
“Confirm you have access to each account listed,” Sara Young, a certified financial planner in Cincinnati, said in an email. “If not, stop the spring cleaning and get this cleaned up — this is hazmat-level cleaning!”
If you find errors, you can dispute them with the credit bureaus.
Mull over those memberships
While you’re reviewing credit cards, take a hard look at the membership cards you carry around. Gyms and wholesale clubs can be expensive, so if you haven’t used them in a while, it’s time to cancel.
“It all goes back to being organized,” Marino says. “Just continuing to monitor what your cash flow looks like and cutting things you no longer find value in.”
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Sara Rathner writes for NerdWallet. Email: srathner@nerdwallet.com. Twitter: @sarakrathner.
