Credit cards serve a dual purpose beyond their basic spending function. As individuals become more experienced with credit card usage, they often seek to maximize the benefits and explore additional value from premium or co-branded credit cards, moving beyond the fundamentals. If your credit card company decides to withdraw or modify certain features, you may wonder what steps to take. Here are some actions you can consider:
- Compare Features: It’s crucial to wait for official confirmation from the card company regarding any changes before reacting to rumors. Once you receive the official communication, document all the changes in one place and compare them with the original features offered by the card company. Evaluate how these changes will impact you.
- Assess the Change: To assess the impact of feature changes, analyze the alterations in terms of monetary value. Compare factors such as reward point earnings, reward-to-mile conversions, changes in fees, and other modifications in monetary terms. This evaluation will provide you with an estimate of how much you stand to lose due to these feature changes.
- Consider Changing the Credit Card: If your card has lost important features that initially attracted you to it, you might contemplate switching to a different card. Before making a decision, compare the new features with those of other cards in the same category. If another card offers better features that align with your needs, consider switching. However, if your existing card still offers superior features compared to others on the market, you may choose to retain it.
- Delay Closing the Credit Card: Closing your credit card should be a last resort. Before doing so, consider potential consequences. Closing a long-standing credit card could result in the loss of a lengthy record of financial discipline, on-time payments, transaction history, and more, which contribute to your creditworthiness. However, if the card’s charges outweigh the value it provides, closing it may be a viable option.
- Transfer Reward Points and Settle Bills: If you intend to close your credit card, make sure to redeem any accumulated reward points. Additionally, review and settle any outstanding bills before closing the card. Avoid conducting transactions on the card for at least one to two statement cycles before closing it, as recent charges may not be reflected in the statement, and your credit card account may remain open despite the closure request. After closing your credit card, monitor your credit report to verify the closure. Sometimes, card companies temporarily devalue their cards and reintroduce new features later on, so it’s essential to ascertain whether the changes are temporary or permanent before closing your card.