There are many things that may lead you to close a credit card account. This isn’t a decision to take lightly, as it can have a negative impact on your credit score, but it may be a move that you have to make.
Here are three personal reasons to close a credit card account:
- You are done taking on debt. Many people reach a point in their life when they no longer want to take on debt, as this has gotten them in trouble in the past. For example, if you just got finished paying off high interest credit card debt, you may vow to avoid this situation in the future. The best way to protect yourself is to close your account altogether.
- Divorce. This is an unfortunate situation, but it’s one that will call for you to close your joint credit card account. Once you decide on divorce, this is something you need to do. Remember, assets aren’t the only things divided as the result of divorce. Debt also comes into play. If you still need access to a credit card, you can always apply for one in your name (and your name only).
- You want something better. Simply put, there may come a time when you realize that your credit card isn’t giving you everything you need. An example of this would be a card with a high annual fee but no rewards program. When you cancel your current account, you can then start fresh during your search for a better offer.
As noted above, these are just a few of the many personal reasons to close a credit card account. Once you understand the pros and cons of making this decision, you can decide if it makes good sense to move forward.
Have you canceled a credit card in the past? Why did you decide on this? Share your personal thoughts and advice in the comment section below.