How Can I Avoid My Credit Card Being Closed?

Don’t Not Use Your Card – Ok, the poor grammar was intentional and corny but I think I’ve made my point.  Credit card issuers are in busy to make money and make a profit.  They can’t do either unless you are using your credit card.  And, the best news is that you do not have to carry a balance from one month to the next in order to drop a few dimes in your credit card issuers pockets.  Each time you use your credit card the merchant (aka the place you used the card) has to pay the bank a fee.  This fee is called interchange.  It technically comes out of your pocket because many retailers will build the assumed fee into the price of the merchandise but it sure doesn’t feel that way when we buy stuff with our credit cards.  So, knock the dust off your cards and use them for modest purchases.  Don’t revolve a balance and don’t get into a position where your balances spiral out of control and you’ll be fine.

Be Quiet! – In the past a viable strategy to get fees waived and interest rates lowered was to call your credit card issuer and complain or otherwise plead your case.  That’s still a decent strategy but beware.  Your credit card issuer might turn the tables and start asking YOU questions in order to determine whether or not they still want to do business with you.  If you call them and THEY start asking questions about your job status and salary then end the convo and hang up or you might just end up with a closed credit card.

Open Another Card Now – One of the worst strategies I see people employing today is the 1-card strategy.  This is a consumer who has swallowed the Dave Ramsey gospel hook, line and sinker.  The problem is that it’s unrealistic and appealing only to the lowest common credit denominator.  You should have MORE cards, not fewer cards.  Clearly this is a credit score play as well since having more available and unused credit limits are always good for your credit scores.  So, if you have one or two credit cards right now, think about opening at least one more.  This gives you options in case one of your credit card issuers starts behaving badly towards you.  Nothing is more empowering than saying “I’ll take my business elsewhere” and then actually doing it.

Credit Reporting Expert, John Ulzheimer, is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and a Contributor for the National Foundation for Credit Counseling.  He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry.  Follow him on Twitter here.