did you make an impulsive decision to get a best credit card and are now regretting it? maybe the financial freedom of shopping at your favourite merchandise store lured you into the mix. or maybe you were unable to gauge the emotional implications of carrying it around.
whatever the case, here is how the activation process usually boils down to:
but, what if the tangibility of actually getting your hands on the credit card gives you cold feet? can you simply ditch the card and choose not to activate it? we hate to bring down your hopes, but it does not work that way.
why? to begin with, choosing not to activate the credit has no effect on the underlying account. chances are that the account is still very much open and operational. this is because, when you apply for a credit card and your application gets approved, you may also be involuntarily agreeing to the opening of a credit card account. what does this translate to? charges you owe to the bank in the form of annual fees. so, if you forget about this altogether and decide to ignore the card, the non-payment of the fees may deteriorate your credit score.
but, there is also a silver lining to this. in the case you have opted for a credit card with zero annual charges, choosing to not activate the card may not affect your credit score at all. for the best results, it is always advisable to consult your bank before taking any decision.
that being said, if you are unsure about getting a credit card, you should never apply for it in the first place. a credit card application gives complete freedom to the bank to pull a hard inquiry on your credit score. this can potentially reduce your credit score by 5 to 10 points. note that this is the affect of every single hard inquiry. thus, multiple credit card applications can significantly tarnish your credit score.
if you have an unactivated and unused credit card at your disposal, the next best course of action is to cancel the card altogether. you need to move quickly and immediately contact your bank to understand the cancellation process. and before going down this road, ensure that you understand the implications of this premature closure.
here is how a credit card account closure affects you:
both of these act as negative indicators for credit reporting agencies, enabling them to reduce your credit scores.
if your bank does not charge you any annual fees for the credit card, an alternative strategy to deal with an unwanted credit card is to actually activate the card and lock it away. in this way:
all of these variables can work in tandem to build a positive credit report for you over time. and if used responsibly, the new card can also be an appropriate source of cash flow management.
do you have an unactivated credit card? share your experiences with us in the comments section!
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