The use of credit cards can be an interesting ordeal, but the truth is that it also carries a lot of risks. A credit card is a payment card issued to cash owners to enable them to pay for either bills or goods and services. However, the use of this card has also unduly helped to take advantage of bargains and encouraged excessive spending on the part of the user, thus the question of how to cancel a credit card may be raised. There are several reasons why canceling a credit card could be an option. Some of which are the cases of divorce, getting rid of unused credit cards, rising annual fees, impulse control, a better reward elsewhere etc.

The cancelling of a credit card account can be done to keep one from abusing credit, reducing the risks of identity theft and also help to ensure an easier bookkeeping. It is also important to note that cancelling a credit card can have a negative impact on your credit score. Puzzled on what a credit score is? The credit score is a number that reflects the likelihood of you paying back credit. Thus, if a credit card needs to be cancelled, it must be done in a smart way

It is indeed true that canceling a credit card could be easy, but doing it the smart way seems to be very important in any society. And canceling a credit card the smart way does not involve the cutting of a card into two, of course that isn’t smart but foolish. It requires one to follow specific steps to close the credit card account totally with the least damage to his or her credit score. There are several steps on how to cancel a credit card, however, some smart ways to do such are:

  • Know who to contact. It’s important to contact your credit card company and also know the customer service department.
  • Remember to redeem rewards, that is to check the rewards balance and redemption procedures on issuer’s website. If the reward has a balance, make sure you pay it off or transfer it to a card with better terms.
  • Contact to confirm that your card is balance free and then make request for the card to be cancelled. You can send a letter requesting the closure of the card account.
  • Take a look at a copy of your credit report to make sure the account is marked as closed. It is very important to check your credit score to see if canceling the card caused any damage. And after the account has been successfully closed, you can then cut up your credit card if you so want.

Finally, it is indeed a fact that when you close a credit card, the ratio jumps because you’re using more of your valuable credit and when this happens, it means your credit score goes down. To avoid this negative situation, cancelling a card must be done in a smart way.

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