Canceling a credit card might seem like a simple task, but it’s still a decision that deserves some thought. Whether you’re dealing with high fees, unused cards, or just trying to simplify your finances, it helps to understand what steps to take and what to watch out for before you close an account.
What to Do Before You Cancel
Before you contact your card issuer, take a few steps to prepare the account. This can help you avoid fees, missed payments, or lost rewards.
- Pay off the balance: Make sure the card has a $0 balance. You typically can’t cancel a card with an outstanding balance.
- Check for recurring charges: Look at your past statements for subscriptions, memberships, or automatic bill payments tied to the card. Move these to another payment method before closing the account.
- Redeem any rewards: Some credit cards erase your unused rewards or cash back when you close the account. If you’ve built up points or cash rewards, use them before canceling.
How to Cancel Your Credit Card
Once your account is ready, you can cancel the card by contacting your credit card issuer. Most companies offer more than one way to close an account:
- Call customer service: Use the number on the back of your card and be prepared to verify your identity.
- Use online tools: Some card issuers let you request cancellation through their website or mobile app.
- Visit a branch: If your card is from a bank with physical locations, you may be able to cancel in person.
Ask for written confirmation that the account was closed. This can help resolve any issues if the closure isn’t reflected correctly later on.
After You Cancel
After your account is officially closed, take a few final steps to wrap things up.
- Destroy the card: Cut up the card so the chip and magnetic stripe are no longer usable. If you have a shredder that handles plastic, even better.
- Check your credit reports: Make sure the account is marked as “closed” and doesn’t show any errors. You can get free credit reports at AnnualCreditReport.com.
Other Options to Consider
If you’re unsure about canceling your card, there may be other ways to reach your goal without closing the account.
- Downgrade to a no-fee card: Some issuers let you switch to a simpler version of your card without an annual fee.
- Use it occasionally: Making small, regular purchases and paying them off right away can help keep the account active without adding debt.
- Ask for a credit limit increase: If your goal is to lower your credit usage across cards, increasing your limit on another card may help.
The Bottom Line
Canceling a credit card is a personal choice, and the best approach depends on your financial habits and goals. By taking a few simple steps—like paying off the balance, updating recurring payments, and checking your credit reports—you can close an account with confidence.
If you’re unsure whether to cancel or keep the card open, consider other options or talk to a financial professional who can help you make the decision that’s right for you.
