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

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

Ever wondered what happens if you don’t use your credit card for months on end? While it might seem harmless to let a card “sit” unused, there can be surprising consequences—from account closures and inactivity fees to impacts on your credit score. Understanding the risks and how to manage an inactive credit card is essential for protecting your credit and maximizing your card’s benefits.

What Can Happen If You Don’t Use Your Credit Card?

1. Inactivity Fees

• • Some credit card issuers charge an inactivity fee if you don’t make any purchases or payments over several months (usually 12–24 months, but can be shorter).

  • Inactivity fees are rare on most major cards but can crop up with certain store, retail, or subprime cards. Always review your card’s terms.

2. Account Closure Due to Inactivity

• • Issuers have the right to close an inactive credit card account at any time—often without warning.

  • Why? Unused accounts cost banks money to maintain, and closing them limits their risk while freeing up credit.

  • You may receive a letter or email that notifies you of a pending closure, but sometimes it happens quietly in the background.

3. Impact on Your Credit Score

An inactive credit card that’s closed by the issuer can affect your credit in several ways:

• • Credit utilization: Canceling a card lowers your total available credit, so your credit utilization ratio (total balances / total limits) goes up, which can drop your score.

  • Credit history length: If the closed card is your oldest account, your average account age can decrease, also impacting your credit rating.

  • Credit mix:  Having fewer open credit accounts can lower your credit mix, which is a smaller—but still relevant—factor in your overall score.

4. Loss of Rewards, Benefits, and Perks

• • If your card earns rewards (cash back, points, or miles), inactivity could mean losing points, forfeiting cash back, or missing out on unused benefits like purchase protection or travel insurance.

  • Some issuers erase accrued rewards when an account is closed.

5. Fraud and Security Risks

• • Not monitoring an inactive credit card can make it a target for unnoticed fraud. Unused cards are often forgotten, leaving room for unauthorized charges to go undetected.

How Long Before a Credit Card Becomes “Inactive”?

• Most issuers will consider your credit card inactive after 6–12 months of no activity.

• Account closure due to inactivity can occur anywhere from 6–24 months with no usage, but policies vary widely by bank and card type.

What Happens to an Inactive Credit Card?

Frequently Asked Questions—Inactive Credit Cards

Q1. Will my issuer warn me before closing my inactive credit card?

• • Not always. Some issuers may notify you before closing an inactive account, but many close accounts without any advance warning. It’s possible for your card to be closed suddenly, especially after long periods of no use.

Q2. How do I know if I have an inactivity fee?

• • Check your cardholder agreement and the issuer’s official website to confirm whether inactivity fees apply. While most major credit cards won’t penalize you for inactivity, some specialty or lesser-known cards may include such fees. Reviewing your account terms is the safest way to know for sure.

Q3. Will a closed inactive credit card hurt my credit score?

• • It can. Closing a credit card lowers your overall available credit, which can raise your credit utilization ratio—an important element in your credit score. If the card you close is among your oldest, it could reduce the average age of your credit accounts—potentially causing your score to drop even more.

Q4. What if I want to keep my card but rarely use it?

• • Make a small purchase or set up a small recurring payment (like a subscription or utility bill) every 3–6 months. Pay it off promptly to keep the account open, avoid interest, and keep your card in good standing.

Q5. Can I reopen an inactive credit card if it’s closed by the issuer?

• • Rarely. Most banks will require you to apply for a new account if your previous card was closed due to inactivity. Reopened accounts are the exception, not the rule.

Q6. Can an inactive credit card collect annual fees?

• • Yes—if your card charges an annual fee, you’ll be billed regardless of how much (or little) you use the card. This can result in surprise fees—or even a negative balance—on unused accounts. Always keep track of annual fee dates to avoid unwanted charges.

Q7. Do authorized user cards need to be used, too?

• • Yes. For authorized user accounts to remain active and continue benefiting your (or the authorized user’s) credit, it’s wise to use or closely monitor those cards regularly. Inactive authorized user cards may be closed, and any benefit to the credit profile could be lost.

Staying proactive with even rarely used cards helps you maintain your credit history, avoid unwanted fees, and prevent sudden account closures. Just a little use goes a long way!

Final Thoughts

Now you know what happens if you don’t use your credit card—from possible inactivity fees to score drops due to account closure. Keep even your inactive credit card in good standing with occasional use and regular monitoring and you’ll safeguard both your rewards and your credit profile for the long haul.