What to Do With Old Credit Cards

If you have a plastic card, use a sturdy pair of scissors to cut it into pieces. If you have a metal card, have your card issuer handle it. Note that destroying the card does not mean the account itself is closed.

a person holding a leather wallet

For most unwanted items, we would simply throw them into the trash can or recycling bin. But, getting rid of old credit cards and other payment cards is not as simple. If your credit card is expired or compromised, you will need to dispose of it safely so identity thieves do not get the opportunity to dig through your trash and piece together your credit card information for a quick profit.

Carelessly handling old credit cards can come back to haunt you in the future and negatively impact your credit scores. So, it’s crucial to understand how to destroy old cards safely to avoid getting frauded.

Key Takeaways

  • Canceling a credit card account could impact your credit scores. Consider other alternatives before committing to closing your account.
  • Throwing away your credit card does not mean the account itself is closed. Address any outstanding issues first to close your account successfully.
  • Depending on whether you have old or expired plastic or metal credit cards, you will employ different methods to throw them away.

Before You Close a Credit Card Account…

If you have a credit card you no longer use, you may get tempted to close your account to consolidate your cards. However, doing this may hurt your credit scores. Your credit utilization and length of credit history make up a significant portion of your credit scores. Depending on how long you have had a card, closing it can lower the average age of your credit cards and increase your credit utilization.

When you close older accounts, you shorten the average length of your credit history, which can work against you. Additionally, your credit utilization ratio is the percentage of your total credit available that you are using. For example, if you have $10,000 in credit available and use $3,000, your utilization ratio is 30%. When you close an account, you reduce how much credit you have available, which can cause your utilization to increase. Most financial experts suggest keeping your credit utilization below 30%, but the lower, the better.

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If you do not want to keep your account open for whatever reason, you have a few other options to consider:

Downgrade Your Card

If you have credit cards with high annual fees, such as the Chase Sapphire Reserve, you may want to close your account to avoid paying the fees. Depending on your card issuer, they may let you downgrade your credit card to a no-fee option. If that is something you are interested in, contact your bank’s customer support and ask if this is an option.

Upgrade to an Unsecured Card

If you have been using a secured card to boost your credit and have outgrown it since then, ask your credit card issuer if you can graduate to an unsecured credit card. Depending on your lender, some will upgrade you to a traditional card after you show you are financially responsible and can pay your bills on time. That way, you do not need to cancel your account or reapply for a new credit card.

Use the Card for Small Purchases

If you do not want to upgrade or downgrade your card, but do not want to close it either, consider using it for smaller purchases to keep your account open. For example, you can buy a pack of gum or chips with it once a month or once every few months.

You can also use it for subscription services, such as Netflix, Discord Nitro, or Spotify, and set up automatic payments, so your balance gets paid regularly with minimal effort. For one of the credit cards I use less often, I charge my Spotify subscription to it, along with one or two small purchases on it every month to keep the account active.

Actions to Take Before Closing an Account

Before canceling your credit card or tossing an expired card away, make sure there are no outstanding issues with your account. For example, if your card expired, activate your replacement card first before throwing it away. If you are closing your card, there are a few steps you need to take:

  1. Pay off any outstanding balance: Closing an account does not mean you are free from your debts. Pay off the remaining balance on your card (if any) before closing the account.
  2. Use or transfer unused rewards: If you have unused reward points or cashback in your account, use all of it first or transfer the rewards to a new account. Once you close your account, any credit card rewards left will likely disappear.
  3. Close the account: Contact your lender either by phone or online so they can walk you through the process of closing your account securely.
  4. Notify other users on the account: Let authorized users on your account know that you are closing it so they can find alternatives.
  5. Modify or cancel automatic payments: If you have any automatic payments set up with this card, such as subscription services or utilities, change the payment methods for them.

Once you have taken these steps, it’s time to throw them away.

Disposing Expired Debit and Credit Cards

Depending on the material your card is made of, you should take different approaches to destroy credit cards safely.

Cut Up Plastic Cards (Properly)

With sturdy scissors and some serious slicing and dicing, you can destroy an expired credit card quite effectively. The key is to focus on areas where you have sensitive personal information, such as your name, card number, security code, and signature. Make sure to separate the card into sections and cut out through each letter and digit.

Use a Paper Shredder Designed for Old Cards

Some paper shredder models are designed to dispose of old credit cards. If you have a paper shredder that can handle old cards, feed your card into it. To be extra safe, shred old credit card documents with your account information as well, such as monthly billing statements.

Deactivate Magnetic Strips and Chips

Before cutting or shredding your card, deactivate the magnetic strip and EMV chip since they are encoded with card information that identity thieves can access even if the card is expired or closed. If you do not destroy the magnet and chip, you could become a victim of credit card fraud even if you cut up the card in a bunch of pieces.

To demagnetize your card, run a strong magnet back and forth along the strip on the back of your card to deactivate the data it contains and ensure the swiping capability is useless. If you cannot find a magnet, a fridge magnet will do. Cut the chip up or crush it as an added precaution.

Separate the Pieces into Multiple Bags

Persistent dumpster divers may try to piece together all your old credit cards to take advantage of any personal information they can find. As an extra security measure, spread the fragments of your credit cards out into multiple bags and dispose of them over a few days or weeks to guarantee that no one can piece your card number together.

Disposing Metal Credit Cards

If you have a metal credit card, such as the Capital One Venture X Rewards Credit Card or the Chase Sapphire Reserve, you will have to take an alternative path to get rid of the card. Destroying a metal card on your own is much harder. Luckily, most financial institutions will dispose of it safely for you at no cost.

Contact your issuer either by calling the number on the back of your card or online. Ask them for a prepaid envelope to mail your card back. Alternatively, check if you live near a local branch and drop it off there. While they might not destroy the card for you, they will know where to send the card.

Check Back on Your Account

While you most likely will not be held responsible for fraudulent charges on an old credit card, it can be a hassle to deal with them. Take extra care with old debit cards or other payment cards where you could end up missing money, even if it’s temporary. We recommend checking your account statements after you close your account to ensure there are no signs of fraud.

Bonus: Join the Expired Card Hobbyists Club

If you do not want to throw away your expired cards, you can keep them as collector’s items. The American Credit Card Collectors Society (ACCCS) is a non-profit run by a team interested in collecting credit cards with members around the globe. According to the rules established by the ACCCS, older cards and unsigned cards in excellent condition are worth more money. Rare credit cards and cards that feature a celebrity or have unique features are also valuable.

How Not to Destroy Your Credit Card

If you want to get rid of your card using more extreme methods, make sure to employ appropriate safety equipment if necessary. Avoid trying to melt or burn canceled or expired credit cards because the fumes can release toxins that might damage your respiratory system.

The Bottom Line

Anyone who has fallen victim to identity thieves will tell you that it is a headache. Save yourself the stress by proactively protecting your personal information and disposing of old cards safely.

There are scenarios where it makes sense to close a credit card account, such as high annual fees or graduating to an unsecured card. Before doing so, consider alternatives, such as downgrading your card or using it for smaller payments. Depending on how long you have had the card and its credit limit, closing an old credit card could negatively impact your credit scores.

We are not financial advisors. The content on this website and our YouTube videos are for educational purposes only and merely cite our own personal opinions. In order to make the best financial decision that suits your own needs, you must conduct your own research and seek the advice of a licensed financial advisor if necessary. Know that all investments involve some form of risk and there is no guarantee that you will be successful in making, saving, or investing money; nor is there any guarantee that you won't experience any loss when investing. Always remember to make smart decisions and do your own research!

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