How long can you leave a credit card unactivated?

The Sleeping Giant: How Long Can You Leave a Credit Card Unactivated?

In the ever-expanding world of plastic, credit cards have become a ubiquitous part of our financial lives. But what happens when one of these cards sits dormant, collecting dust in a drawer? Can you simply leave it unactivated indefinitely? The answer, unfortunately, is no.

While credit cards offer a convenient way to manage finances, unused cards face a silent threat: inactivity. Just like a dormant volcano, an unactivated card may seem harmless, but it’s a ticking time bomb waiting to erupt.

The reason for this looming danger is simple: profit. Credit card issuers make money from transaction fees and interest charged on balances. An inactive card, by definition, generates neither. This lack of income can push issuers to close accounts that haven’t been used for an extended period.

So, how long is too long? It’s not a clear-cut answer. While some issuers might close accounts after just a few months of inactivity, others might wait a year or more. The key takeaway is that inactivity could eventually lead to closure.

Here’s a closer look at the reasons behind account closure:

• Reduced revenue: As mentioned above, unused cards don’t generate any revenue for the issuer. This makes them a financial burden, prompting closure.
• Maintaining inactive accounts costs money: Every account requires maintenance, including security checks and data storage. Issuers are reluctant to spend resources on inactive accounts.
• Security risks: Inactive accounts can be a target for fraudsters. To minimize risk, issuers may choose to close inactive accounts.

What can you do to keep your cards active?

• Make a small purchase: This could be as simple as buying a cup of coffee or a newspaper online. The key is to make a transaction to demonstrate active use.
• Use your card for recurring bills: Set up auto-pay for services like utilities or subscriptions.
• Check with your issuer: Contact your credit card issuer to understand their inactivity policies.
• Consider closing inactive accounts: If you’re certain you won’t use a particular card, it’s best to close it to avoid any potential closure issues.

Remember, credit cards are valuable tools for managing finances, but they require active use. By staying vigilant and taking simple steps to demonstrate activity, you can avoid the risk of having your cards closed due to inactivity.