Closing out your oldest credit card immediately shortens credit history and negatively affects your credit score. Length of credit history accounts for approximately 15% of your credit score, and lenders naturally tend to view borrowers with short credit histories as riskier than those who have responsibly held credit for a longer period of time.

So, you will want to keep that first credit card around forever, and remember to use it from time to time. Some credit card issuers, such as Citibank, will automatically close down an account after a period of inactivity.

Do not rely on credit as an emergency fund. Everyone's personal financial plan should include a goal of having at least six months' worth of living expenses saved in a liquid emergency fund such as an online savings account. If you find yourself in desperate need of credit in this current market, and you have a poor credit score or no credit at all, you may find it quite difficult to get what you want. However, if you already have an easily accessible reserve of cash, you won't need to resort to credit at all in your time of need.

The best way to prove you are a reliable credit risk is to always make your payments on time. If you find yourself forgetting when your credit card payments are due, take a few moments to set up direct debits for all of your cards from one central checking account. Now you will only have to remember one thing- make sure you have enough in your checking account to cover the payments each month! Your personal bank should be willing to provide overdraft protection in case of an emergency.