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The honeymoon is over.

Things aren’t as simple as they used to be. The spending’s gone cold. Annual fees are more of a chore than a choice. And that spicy little signup bonus? Seems like a lifetime ago.

First, do you really need to cancel your credit card?

Before you do anything, don’t. Stop and assess whether you truly need to break it off with your credit card. Canceling a credit card can knock a dent in your credit score, but it doesn’t have to.

Be scrupulous and ask yourself: Am I struggling to balance my spending? Are the fees too much to bear? Has the card been inactive for months…or (*Gulp*) years? If you can answer yes to most, well, step right this way:

Three easy steps to cancel your credit card

  1. Pay off the balance.
  2. Notify the card issuer by phone and then follow up by notifying the card issuer in writing.
  3. Get a copy of your credit report and make sure it’s accurate.

1) Pay it off. To avoid damaging your credit score, make sure to clear your balance in full before you cancel your card.

It’s the right thing to do. In the eyes of both the great philosophers and — perhaps more importantly — your card issuers. Don’t even think on it: Pay off every last dollar in your account. Carrying a balance into your cancellation process is a no-no.

At worst, you’ll sour your relationship with the card issuer, and rest assured the credit reporting agencies will take note. At best, it’ll gum up the process further down the road. We recommend you pick a hard date to drop your spending with that card altogether, pay off the outstanding balance, then move to step two.

“There isn’t a need to cancel that account until you’re through with it,” says Jean Brannan, community outreach coordinator for Consumer Credit Counseling Service in West Palm Beach, Fla. She adds that you have to employ self-discipline and stop using a card while you’re paying off the balance.

If you do have a balance on the card you want to cancel — maybe because you’re paying very high interest on your balance — you could consider doing a balance transfer to a card offering better perks, like long 0% introductory APR period, which will enable you to pay down your debt sooner as you’ll be paying less interest. You will need to complete the transfer to the new card before you cancel the old card.

2) Call it in. The safest, easiest, and most effective way to cancel your credit card is to call customer services. You can find the number on the back of your credit card or on your most recent statement.

We know, we know. Picking up the phone is so… 1993 (and so is that joke). But it’s the safest and most effective way to cancel your card. Start by finding your issuer’s customer service number on your credit card or most recent statement, then give them a call, confirm that your balance is zero and be candid about why you’re canceling.

Do not call to cancel a card if you still have a balance. If the card issuer knows you are thinking about leaving, it could raise your interest rates to the maximum allowable by law as a penalty for closing the account, if you do so with an outstanding balance.

Some companies will allow you to cancel without even talking to a customer service representative. Others will transfer you to a special department for the sole purpose of trying to convince you to not cancel your card. So it’s not uncommon to hear a counter offer. Maybe your card issuer is running a new promotion under your current card. Maybe they’ll lower your interest rate. Or maybe they’re offering a new card with some suped-up travel benefits. It’s worth your time to listen in, but if nothing tickles your fancy, simply repeat your intention to cancel. It won’t take long for them to get the message.

Bonus points for a follow-up letter! As a clearinghouse effort, send a piece of certified mail to the issuer that states your cancellation request. It may only need to be a short letter. “If you can get a name so you can send it directly to someone, that is better,” Brannan says. The letter should say that you’re closing your account and that you want your credit record to reflect the fact that you requested that the account be closed. Provide your name, address, and account number. The closing process can take up to 30 days, so it’s always good to have a record handy.

3) Check it out. Make sure to keep a close eye on your credit score and follow up with the issuer if there are any problems.

Wait about a month and then get a copy of your credit report and make sure it lists the account closure as “closed at customer request.” Fewer words than “account closed by creditor” can have a larger impact on your score. On the off chance, your (now-former) creditor mistakenly listed the cancellation as their initiative, you’ll want to take it up with them.

The credit bureaus simply report on what the issuers tell them, so don’t bother looking to them. Use the same customer service number you called for the original cancellation and get a human on the phone as soon as possible. Follow up with a letter sent by certified mail (include a copy of the letter you wrote requesting that the account be closed), and check your credit report again. Stay doubly vigilant checking future credit reports.

All that said?

Canceling a credit card isn’t a difficult process, but it’s worth a thorough look. As with anything, an informed decision puts you ahead of the curve. Next go round, consider a shift in your spending habits, and start looking into credit cards with no annual fees. Multiple cancellations can be a headache for both your schedule and your credit score.

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