Canceling your credit card will hurt your overall credit score and most people don’t know why. A new Bankrate report claims credit card closures more than doubled in the past five years but only 42% of people who closed an account knew it would hurt their credit score.

“You would actually be surprised,” Bankrate analyst Ted Rossman told Yahoo Finance’s On the Move, noting that credit rating agencies rank people higher if they utilize less of their available credit. “The scoring algorithms really do reward you for having more available credit and a longer history.”

Closing a credit card account lowers your amount of available credit and hurts you when the agencies calculate your credit utilization ratio.

Who closes credit card accounts

Bankrate says six in 10 Americans have canceled a credit card and older Americans are more likely than younger Americans to do that. Seventy-two percent of Baby Boomers have closed an account, while just 50% of millennials have shut down a card. Twelve percent of those who canceled a credit card mistakenly thought it would help improve their credit score. Bankrate surveyed 2,582 adults. The Consumer Financial Protection Bureau can walk you through steps to obtain your credit score and free credit report.

Best to keep a line of credit

Forty percent of respondents say they closed an account because they paid off their debt. It was the number one reason people canceled a car. Meanwhile 36% said they did not use the card enough or the interest rate was too high and 28% said the annual fee was too high.

Rossman says instead of closing an account, cardholders should call the bank and negotiate to keep it open. “You can get perks from your credit card company just by asking,” he said, adding that it works around 70% to 80% of the time. “You can get a late fee waived. You can get an annual fee waived.”

Keeping a line of credit open, he says, works in your favor even with a zero balance because it adds to your credit longevity. “These credit scoring bureaus really want to see that you’ve had a long responsible payment history so my advice is to keep your old accounts open.”

Rossman even advises people to add new credit cards when it makes sense just “don’t cancel the old ones.”

Adam Shapiro is co-anchor of Yahoo Finance On the Move.

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