How to Cancel a Credit Card

Perhaps you’re in over your head with your debt and now you’re considering canceling your credit card. Or maybe you no longer want to pay high annual fees and want a card that won’t charge you. No matter your reasoning, it’s important to consider the impact closing your card could have on your credit profile, such as lowering your credit score and increasing your credit utilization ratio.

To help prevent this, look into safe ways to cancel your card and research alternatives to pay off debt before you make a decision. After all, you want to ensure that whatever choice you make, it will have a positive effect on your financial future.

Understanding how credit cards work is essential when you’re considering canceling your card. This choice will affect your credit score, including the major score factors such as utilization rate, credit history and credit mix or the different types of credit you have, such as a card or a loan.

There are steps you can take to prevent negative effects on your score, such as ensuring the card stays on your report. If you do your due diligence and safely close your credit card, then it could have less of an impact on your score. And if you can take a hit in the short run, perhaps you could increase your score again so that you can access new lines of credit when you need them.

If you are having trouble with your finances because you’re in debt, then you may want to consider canceling your credit card. Canceling your card could also be better for your overall finances in the long run. It’s a step that’s not as dramatic and not nearly as impactful as bankruptcy – which it could help you avoid if you’re in a dire financial situation. Sometimes, canceling your card is the right thing to do.

You may consider canceling your credit card when it makes sense for your financial future. When you look at the big picture, this step may be detrimental now, but overall, it could positively impact your credit report and make it easier for you to gain access to new lines of credit later on — perhaps when you need them the most. The following could be reasons you may consider canceling your credit card.

There are a number of reasons to keep your credit card open because of the negative impact canceling it could have on your credit score. This could snowball and impact you in other areas of your life. Perhaps you are committed to using the card in a responsible way or there is a benefit to having the card in your wallet. The following are some good reasons to keep it open.

Canceling a credit card is a big step. Ideally, it should be one of the last considerations. Instead, there are alternative steps that you can pursue before making a decision. They include trying to pay down your debt, negotiating with your credit card issuer, redeeming your rewards for statement credits and more. Taking these steps seriously could prevent you from experiencing negative reports on your credit profile.

Want more information on canceling a credit card before you make a decision on whether or not to do it? Then read up on canceling a credit card FAQs to learn everything you need to know.

Want to learn more about canceling a credit card and perhaps about credit cards in general? The following resources can help you stay on track with your credit and ensure that you have a brighter financial future ahead.

• Credit Card Terms 101: Not sure what a specific term means? Learn A-Z what credit card terms and vocabulary means in this comprehensive glossary.
• Guide to Your First Credit Card: Learn how to manage your spending, what card options may be a good fit for you and how to apply in this guide for first-time credit cardholders.
• How Credit Cards Work: Have any questions about how credit cards work? Then this page will help you find out everything you need to know about them.
• The Best Balance Transfer Credit Cards: Instead of closing your credit card, you can get a balance transfer credit card and gain access to a 0% interest during a promotional period. This will give you more time to pay your debt.
• The Best Rewards Credit Cards: Find rewards credit cards that may be worth applying to and keeping open. With these, you can reap the benefits of spending on your card.