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(Precious) Words of Wisdom : "Wall Street makes its money on ACTIVITY, you make your money on INACTIVITY." ~ Warren Buffett

Cancel your credit card the correct way

Nowadays, credit cards are quite common. Also, as quite a few banks offer lifetime free cards, people collecting a bunch of them is quite common too.

And when some of these become redundant and unused, it is common for people to merely leave them in their drawers or cut it into pieces and throw them away in the dustbin.

You are taking a big risk if this is how you discard your unwanted credit cards. There could be some amount due that you may unaware of. So you will keep receiving the bills; which will keep ballooning month after month due to interest charges. Even if their are no annual charges to pay, there is a risk of theft, misuse or fraud.

As such, it is important to follow the guidelines laid down by your bank if you wish the credit card to be properly deactivated.

Typically, you would have to follow the following steps.

Needless to mention, the first step is to clear the outstanding amount against the card and all other applicable fees / charges. Banks will not deactivate your card until all the dues are cleared.

Next, make a formal request to the bank to cancel the card. Please do it in writing. Verbal communications are often difficult to prove. As such, in cases of any dispute, the matter can turn really ugly.

Ensure that you get a 'written' confirmation from the bank that it has received your request for cancellation.

Follow-up till you receive the bank's final acknowledgement that your card has been deactivated.

After waiting for a few months, obtain a copy of your credit history to confirm whether the same has been duly updated and shows that your card has been cancelled.

Then and only then you can cut the card, trash it and sleep peacefully.

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