in our free newsletter.

Thousands benefit from our email every week.

Take these steps to cancel a card cleanly, so you won't regret it.

1. Make sure you're canceling for the right reason

Picture showing pretty woman shopping online with credit card
Kamil Macniak / Shutterstock
Cancel a card if you can't control yourself with it.

These are the reasons you might nix a credit card:

  • If your debt is unmanageable and you can’t resist the temptation to spend.
  • If the card has an exorbitant interest rate, and you've found one with 0% APR.
  • If the card charges an annual fee that's taking a bite out of your income.
  • If the card’s rewards program has changed or expired.
  • If the card’s terms have changed and you’re suddenly stuck with unwanted fees.

If the above reasons don’t apply to you, it may be best to leave the card open and not use it. Canceling the card could hurt your credit score in more ways than one.

The existing balances on your other open accounts may cause what's called your "credit utilization rate" to artificially shoot up, negatively impacting you in the eyes of creditors.

If you opt to cancel a credit card, close the newest one or the lonely card you use the least.

More: How many credit cards should I have?

Good credit is important for your financial health, and Borrowell can help you take a turn for the better. Sign up for Borrowell to get your credit score and credit report for free!

Sign up

2. Consider keeping the card to build credit

Hands holding plastic credit card and using laptop
Yulia Grigoryeva / Shutterstock
There's no harm in keeping a credit card open with something as small as a Spotify subscription.

Keeping a credit card open means you’re still building positive credit, even if your account is mostly dormant. You get dinged only if there’s an existing balance on the card that doesn’t get paid off, so make one small purchase a year and pay it off right away — or throw your Netflix subscription on it.

The longer you have good credit, the better you look as a candidate should you ever apply for a loan, mortgage, even a new job.

If the account is active and you’ve been nailing your payments on time, your credit is considered in good standing; closing the card could erase years of good credit and skew the average age of your accounts.

Consider keeping the account open, but putting the card in a drawer at home where you can’t access it.

Read all of the above and still want to cancel? No worries, we’ll walk you through how to do it effectively.

3. Don't let rewards die with the card

Top view of woman hand holding credit card and shopping online
wutzkohphoto / Shutterstock
Take advantage of all your card's rewards.

Many credit cards have some sort of points program — especially if the card is tied to a store rewards program.

Before you make a move to cancel, make sure you take advantage of the rewards you’ve accumulated.

Check the card or company website for details on how to redeem — and don’t cancel until you’ve milked all the rewards.

The best cash-back cards have the easiest redemption features.

More: Travel rewards vs. cash back credit cards

Get a $25 bonus when you open and fund your first Wealthsimple Investment account* (min. $500 initial deposit). Trade and Cash accounts are not eligible. Sign up now to take advantage of this special offer.

Get started

4. Pay off your balance

Close-up of credit card statement with focus on Total Amount Due
ImagineerInc / Shutterstock
Be sure that your balance is paid off before you attempt to close out a card.

Unfortunately, canceling a card will not magically erase mountains of debt. (We wish!)

You’re still on the hook for the card’s existing balance, and failing to pay it off could torpedo your credit score.

Even if you transfer your debt to a balance transfer credit card, you could be hit with additional fees. Pay your card’s outstanding balance in full before making the move to cancel.

5. Cancel all automatic billing

Person reviewing bills, and paying them off
chingyunsong / Shutterstock
Review your bills carefully.

Make sure to cancel any recurring payments or bills linked to the card. This step is crucial.

If a merchant or service provider later tries to charge your closed account and the transaction bounces, they could report you to the credit bureau for nonpayment, which damages your credit score for up to seven years.

Additionally, you may be charged late penalties after 30, 60 and 90 days.

Creditors don’t like to see missed payments and late fees, so don’t let those long forgotten automated bills put you in the red.

6. Make a goodbye phone call

Woman on the phone in her home office, in front of the computer.
Monkey Business Images / Shutterstock
Calling the company helps tie up any loose ends.

Call the credit card company’s customer service number, usually found on the back of the card or on a statement or bill. Let the customer service rep know that you’re ready to cancel.

You will likely be asked why you’ve decided to close the account. You can give any reason you like. Ultimately, this is your decision. You’ve already weighed the pros and cons, so by this point you should feel confident that canceling is the right decision for you.

The agent will likely try to talk you into keeping the account, but stay firm. Keep a recent statement nearby so that you’re prepared to answer any questions the representative may have.

When you’re done, make certain that you receive confirmation of the cancellation in writing.

You're 5 minutes away from the best mortgage

Searching for your perfect mortgage shouldn’t be hard.

Homewise is an online brokerage that will negotiate on your behalf with more than 30 big banks and other lenders, completely free, and it only takes five minutes to apply.

If you're in the market for a new mortgage, or if you're looking to refinance before interest rates rise again, go to Homewise now and answer a few simple questions to get started.

What to Read Next


The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.