It isn’t as easy as just cutting and chucking.
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Sooner or later, you’re going to have to take scissors or a shredder to plastic. An old credit card of yours will expire, or (in rarer cases) you’ll cancel one.
Here’s what you should do, in both instances, to dispose of a credit card in such a way that no one fetches it from the dumpster to make mischief -- yes, it happens!
What to do before you dispose of a credit card
If you’re canceling, don’t plot the destruction of your card right away. It’s good to take a few steps in order to ensure that there won’t be any outstanding issues with the account. Those moves are:
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Close the account -- For this, you’ll need to contact your issuer. They’ll guide you through the process once you inform them you’re canceling. You’ll also want to know the outstanding balance that needs to be settled, plus the rewards you’ve earned from using the card (hopefully you can either keep them or spend them upon your exit).
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Notify other users -- Any authorized cardholders sitting on your account need to know their cards will no longer be valid. It’s good to suggest that they destroy their cards too.
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Modify/cancel automatic payments -- We all like convenience, and automatic payments through a card are common these days. If you have any set up with your soon-to-be former credit card, they’ll have to be ported to another means of payment.
Destroying a credit card
Whether you’re canceling a card or putting an expiring one out to pasture, you’ll have to do the fun work of rendering it useless. After all, even with a canceled product you want to be 100% sure it’s unusable.
The first step is to demagnetize the stripe on the back of the card. This is where cards have traditionally held their data. Although the strip will eventually be supplanted by the chip cards now commonly in use (hopefully, anyway), there are plenty of holdovers.
Find a magnet, preferably a strong one, and run it over the strip several times. That should neutralize its swiping capability. We should note here that cutting up a card -- more on this in a second -- will also render the strip non-functional, so this step should be considered additional security for the cautious.
Chips are a bit tougher to neutralize. You can cut them with a pair of scissors, or even break them apart with a hammer.
Hold on to that pair of scissors, since the next move is slicing the card. A good way to cut it is to bend the card into at least three pieces, more or less evenly divided among the digits of the card. It’s wise to dispose of each piece in different garbage cans so they’re harder to find and thus harder to piece back together.