Closing a credit card, especially one from a major issuer like American Express, requires a thoughtful approach. It's not just about cutting up the card; there are several steps to ensure you don't negatively impact your credit score or leave any loose ends. This guide will walk you through the entire process, from initial considerations to what to expect after closure.
Step 1: Consider Your Reasons for Closing
Before you even think about picking up the phone, let's take a moment to reflect. Why do you want to close your American Express credit card? Is it:
High Annual Fees? Perhaps the benefits no longer outweigh the cost.
Too Many Cards? Managing multiple credit lines can be overwhelming.
Debt Management? You're trying to reduce your available credit to avoid overspending.
Dissatisfaction with Service? You've had a poor experience with Amex.
Simplification? You just want fewer financial accounts to track.
Understanding your motivation will help you decide if closing the card is truly the best option. Sometimes, alternatives like downgrading to a no-annual-fee card or utilizing balance transfer offers might be more beneficial.
Step 2: Evaluate the Potential Impact on Your Credit Score
Closing a credit card can affect your credit score, sometimes negatively. Here's what to consider:
Sub-heading: Credit Utilization Ratio
Your credit utilization ratio is the amount of credit you're using compared to your total available credit. Closing a card reduces your total available credit, which can increase this ratio. For example, if you have two cards, each with a $10,000 limit, and you owe $2,000 on one, your utilization is $2,000 / $20,000 = 10%. If you close the card with no balance, your available credit drops to $10,000, and your utilization becomes $2,000 / $10,000 = 20%. A higher utilization ratio can lower your credit score. Aim to keep your utilization below 30%.
Sub-heading: Length of Credit History
The length of your credit history is another factor in your credit score. Closing your oldest credit card can shorten your average credit age, potentially lowering your score. If the American Express card is one of your oldest accounts, think twice before closing it, especially if it has a long, positive payment history.
Sub-heading: Credit Mix
Having a variety of credit accounts (e.g., credit cards, loans, mortgages) is generally positive for your score. However, closing one credit card usually won't significantly impact your credit mix unless it's your only revolving credit account.
Step 3: Pay Off Your Balance Completely
This is a crucial step. You cannot close a credit card with an outstanding balance.
Sub-heading: Zero Out Everything
Ensure your balance is $0. This includes not just purchases but also any pending interest, fees, or even small fractional amounts that might have accrued. It's a good idea to pay slightly more than the stated balance to account for any last-minute charges or interest.
Sub-heading: Wait for Statement Cycle
After paying off your balance, wait for your next statement cycle to close. This ensures that the payment has been fully processed and reflected, and that no new charges have posted.
Step 4: Redeem Any Rewards or Benefits
American Express is known for its excellent rewards programs. Do not close your card before redeeming all your points, miles, or cash back! Once the account is closed, you will likely forfeit any accumulated rewards.
Sub-heading: Membership Rewards Points
If your card earns Membership Rewards points, make sure to transfer them, redeem them for gift cards, travel, or statement credits. If you have another American Express card that also earns Membership Rewards, your points might be pooled, but it's always best to confirm with Amex directly if they will remain accessible.
Sub-heading: Other Benefits
Check for any other unused benefits like travel credits, lounge access, or purchase protections. Utilize them if they are valuable to you before closing the account.
Step 5: Contact American Express to Request Closure
Once you've completed the above steps, it's time to formally request the closure.
Sub-heading: Call the Customer Service Line
The most effective way to close an Amex card is by calling their customer service line. You can usually find the number on the back of your card or on the American Express website.
Be prepared to provide your account number and verify your identity.
State clearly that you wish to close your credit card account.
The representative might try to retain you by offering incentives (e.g., waiving annual fees, bonus points, or promotional APRs). Be firm if you've made up your mind, but also be open to hearing their offers if you're not completely set on closing.
Sub-heading: Confirm Zero Balance
During the call, the representative will confirm that your balance is indeed $0. If there are any discrepancies, resolve them before proceeding.
Sub-heading: Request Confirmation
Ask for a confirmation number or an email confirmation stating that your account has been closed. This is your proof that the request was processed.
Step 6: Monitor Your Credit Report
After closing your card, it's important to monitor your credit report to ensure the closure is accurately reported and that no unexpected activity occurs.
Sub-heading: Check All Three Bureaus
Regularly check your credit reports from all three major credit bureaus (Experian, Equifax, and TransUnion) via AnnualCreditReport.com. It may take a month or two for the closed account to reflect on your report.
Sub-heading: Look for Accuracy
Verify that the account is listed as "closed at cardholder's request" and that there's no outstanding balance. If you find any inaccuracies, dispute them immediately.
Step 7: Shred the Card ✂️
Once everything is confirmed, physically destroy the card.
Sub-heading: Securely Dispose
Shred the card, cutting through the magnetic strip and the chip. This prevents any unauthorized use of the card number.
FAQ: How to Close Your American Express Credit Card? ❓
How to check my American Express balance before closing?
You can check your American Express balance by logging into your online account, using the Amex mobile app, or calling the customer service number on the back of your card.
How to redeem American Express Membership Rewards points?
You can redeem Membership Rewards points directly through the American Express website by logging into your account and navigating to the "Rewards" section.
How to avoid a credit score drop when closing a card?
To minimize a credit score drop, pay off all balances on other cards, keep your credit utilization low, and ideally, avoid closing your oldest credit card.
How to confirm my American Express card is fully closed?
You can confirm closure by calling American Express customer service and requesting confirmation, and by checking your credit report after a few weeks.
How to get a confirmation of account closure from American Express?
When you call to close your account, request a confirmation number or ask for a written (email or mail) confirmation that the account has been closed.
How to close an American Express card with an annual fee?
Follow the same steps; ensure the balance is $0, and consider calling before the annual fee posts to your account if you wish to avoid paying it for the upcoming year.
How to contact American Express customer service?
You can find the customer service number on the back of your Amex card, on your monthly statement, or on the official American Express website under the "Contact Us" section.
How to handle remaining credit card debt before closing?
You must pay off all remaining credit card debt entirely before American Express will allow you to close the account. Consider a balance transfer to another card if you can't pay it all off at once.
How to cancel a supplementary card on American Express?
To cancel a supplementary card, the primary cardholder needs to contact American Express customer service and request its removal.
How to re-open a closed American Express account?
Generally, once an American Express account is formally closed, it cannot be re-opened. You would need to apply for a new card if you wish to have an Amex account again in the future.
