What happens if I just don't use my credit card?

Consequences of Credit Card Inactivity

Failing to use a credit card can have both positive and negative consequences. While it may not seem like a major issue to simply stop using a credit card, there are potential implications to consider.

Positive Consequences:

• No Transaction Fees: You won’t incur any transaction fees or interest charges if you don’t use your card.

• Reduced Risk of Fraud: Leaving your credit card inactive reduces the risk of unauthorized use or identity theft.

Negative Consequences:

• Card Closure: Credit card issuers may close inactive accounts after a certain period of time, typically 12-24 months. This can be inconvenient if you later need to use the card again.

• Damage to Credit Score: Inactivity can negatively impact your credit score. Lenders use your credit card usage history to assess your creditworthiness. A lack of recent activity can lower your score, making it harder to qualify for future loans or credit cards.

• Lost Benefits: Some credit cards offer rewards points or cash back for usage. If you stop using the card, you’ll miss out on these benefits.

Monitoring and Action:

To avoid the negative consequences of credit card inactivity, it’s essential to monitor your account and take appropriate action.

• Set Email Alerts: Request email alerts from your credit card issuer to notify you of any charges or amounts due.
• Make Small Purchases: Occasionally use your credit card for small purchases, such as a cup of coffee or a book. This shows lenders that you’re still using the card and helps maintain your credit score.
• Contact Your Issuer: If you plan on not using your credit card for an extended period, contact your issuer and explain your situation. They may be able to keep the account open without activity.

In conclusion, while there are potential benefits to not using a credit card, it’s important to be aware of the negative consequences that can arise from prolonged inactivity. By monitoring your account and using the card occasionally, you can avoid these issues and keep your credit score in good standing.