One of the questions I get Every. Single. Day. (and with good reason!!!) is “How do I know when to cancel a card?” “Should I cancel a card?” “Will canceling a card affect my credit score?” Let’s discuss!

Before canceling a card, consider these options:

• Do the benefits of this card outweigh the annual fee? For instance – do you receive a yearly free night certificate that outweighs the charge of the annual fee? You may want to consider keeping it open. For instance, these 3 credit cards each come with an annual free night certificate, which is worth far more than the $100 annual fee!
  • World of Hyatt Credit Card
  • Marriott Bonvoy Boundless® Credit Card
  • IHG One Rewards Premier Credit Card

• Is there an option to downgrade to a no annual fee version of that card? Call or send a secure message to the bank asking for this.
  
• Is there a retention offer?
  
  • When you call or message the bank, say, “I am considering canceling my _____ card. Before I cancel, are you able to offer a retention offer?” They may be willing to waive the annual fee or give you other benefits that would be worth it for you to keep the card!
  • Note: Some credit cards only allow you to reapply and be approved for the same card every 24 to 48 months. If you are getting a retention offer, make sure that it doesn’t start that clock over if you are interested in opening the card again!
    
• Cancel your card.
  • Canceling a card doesn’t have to be bad! Just make sure that it isn’t your longest line of credit. You always want to keep the card you have had the longest open. Yep – so if you have an Express credit card from your first year of college – that’s staying with you forever!
  • When you cancel a credit card, your credit score may dip for a month or so, but it’ll rebound! It also might open up more credit that the bank is willing to allot you the next time you apply for a card!