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What Happens If You Don’t Use Your Credit Card?

By Sarah Li Cain · October 13, 2022 · 6 minute read

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What Happens If You Don’t Use Your Credit Card?

There may come a time when you end up not using one of your credit cards anymore. This can happen because you’ve amassed multiple cards and now have one that offers better rewards, or maybe you have a retail card for a store you no longer frequent. Whatever the reason, it’s valid to wonder what happens if you don’t use your credit card.

In many cases, nothing will happen. However, there may be some instances where not using a credit card will carry consequences. That’s why it’s important to know what happens if you don’t use a credit card.

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Is It Bad to Have a Credit Card and Not Use It?

Typically, no, it’s not bad to have a credit card that you don’t use regularly. Not using a credit card for a few months is usually not that big of a deal as long as you keep making any necessary payments on any credit card charges you’ve made. However, there may be some unintended consequences of not using a credit card for a longer period of time.

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What Happens If You Don’t Use Your Credit Card?

If you’re wondering, ‘Is it bad to not use a credit card?,’ here’s a look at some of the potential consequences.

You Might Overlook Fraudulent Charges and Activities

If you don’t use your credit card, you may end up missing transactions that you otherwise would have noticed on your credit card statement. For instance, if your credit card information were to get stolen and used for unauthorized purchases, you might not spot that activity if you’ve stopped checking your statements. The longer the issue continues, the more damage that can be done, given what a credit card is.

You Might Miss Payments

Another possible consequence of an unused credit card that you’re not checking in on regularly is missed payments. If you need to pay an annual fee for the card, for instance, you could forget that you’ll be charged if you’re not often using the card. Missing a payment can have severe financial consequences, which is why making on-time payments is one of the cardinal credit card rules.

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Your Card Issuer May Close Your Account

If you don’t use a credit card for a long period of time — say, at least a year — your issuer may close your credit card. What’s more, credit card issuers don’t have to give you notice when they’re about to close your credit card, so you may only find out when you go to use it.

Exactly what counts as inactivity and the length of time before an account closes will be up to each credit card issuer. If you’re concerned about your card being closed due to inactivity, contact your issuer to find out when they may close your account.

Your Credit Score May Go Down

If your credit card issuer closes your credit card, your credit score could be negatively affected. This is due to a couple different reasons.

For one, the closure of your account will cause your overall credit limit to go down. This could drive up your credit utilization ratio — the percentage of the overall amount you use across the credit limit of your credit cards — which accounts for 30% of your credit score. The higher this ratio, the lower your score can go because creditors tend to take this as a sign you may have issues with handling debt. If the closed credit card had a high credit limit, it could affect your credit utilization even more.

Secondly, the closure of your credit card could impact the length of your credit history, which accounts for 15% of your credit score. Closing a credit card you’ve had for a while could result in a negative impact on your score, marking another way that not using a credit card can hurt your credit score.

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You May Lose Your Rewards

Depending on your credit card, any unused rewards will expire after a certain period of time. What’s more, if your issuer ends up closing your credit card due to inactivity, any rewards you’ve earned on your card up to that point could be lost.

How Long Can You Go Without Using a Credit Card?

How long you can go without using a credit card will depend on your issuer. Some may close your credit card after six months of inactivity, whereas others may only close the card after a year of inactivity or more.

Again, it’s important to check your credit card’s terms and conditions to learn more about how a credit card works. Or, you can contact your issuer to find out what can happen if you don’t use your credit card for a while.

Closing a Credit Card You Don’t Use: What to Know

If you have a credit card you no longer want to use, it might make sense to close it. While the previously mentioned consequences may happen — such as losing your rewards and facing impacts to your credit score — it is still possible to close a card.

Before doing so, determine whether your credit card has a high credit limit and consider how long you’ve had the card. Closing a credit card you’ve had for a while could have a negative impact on your score. Same goes for a credit card with a high limit, since it could significantly raise your credit utilization.

If neither of the above are of concern, then think carefully about whether you’ll likely use the card again in the future. Does this card not help you earn rewards, whereas other ones you own do? Or is this a secured credit card and you can now qualify for an unsecured card?

If there’s no potential major financial impact to closing the card, and you’re sure you won’t use it anymore, then you might consider moving forward with closing it.

Does Not Using a Credit Card Hurt Your Credit Score?

The effect that not using a credit card will have on your credit score depends on whether the issuer closes your account. If the credit card is still open and you’re otherwise responsible for credit that you do use, like making consistent on-time payments, then your credit score most likely won’t be affected.

Keeping Your Cards Active Without Hurting Your Credit Score

Keeping a credit card active is as simple as using the card every few months for regular, small purchases. You might consider using the card to cover a subscription to a streaming service, for example. Or, you could use it to cover another monthly bill.

If you’re worried about checking in frequently enough, you might set up autopay for that credit card. That way, you’ll ensure you’re paying on time.

The Takeaway

It’s normal to not use a credit card if you have other ones that are a better fit. But before closing the card or letting it get shut down due to inactivity, consider making small purchases on it to keep it active. Otherwise, you’ll want to determine whether your credit score can handle potentially taking a dip.

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FAQ

Will I be charged if I don’t use my credit card?

If your credit card typically charges an annual fee, that fee will still apply even if you don’t use your credit card.

What happens if I don’t use my credit card for a year?

Some credit card issuers may close your credit card, even without your knowledge, due to inactivity. This may occur if you don’t use your card for a year or more, though the exact length of time will vary depending on the issuer.

Should I get rid of my credit card if I don’t use it?

You can get rid of your credit card, but know that it may affect your credit score. It’s a good idea to research the potential consequences of closing a credit card before actually doing so.

Do unused credit cards affect your credit score?

Unused credit cards may affect your credit score if you or your credit card issuer closes the account. The account closure could result in an increased credit utilization ratio since your overall credit limit will go down across all of your cards. Plus, if the close credit card is one of your oldest ones, it could diminish the length of your credit history, therefore affecting your score.


Photo credit: iStock/kohei_hara

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