Here’s why it can be empowering to cut up your credit cards when paying off credit card debt.

Cutting up your credit card when facing overwhelming consumer debt not only provides a powerful visual symbol of your commitment to pay off your debts but also creates a small barrier to using your credit account(s) in the future.

Cutting up your credit card does not mean you are closing your credit card account. The plastic card is merely a means to access the available credit on your account. Your credit card company may very well send you a free replacement card at your next account anniversary if they notice you have not been using your account for a while. Additionally, you can order a replacement at any time, though there may be a fee.

The Power of Cutting up Your Credit Card

The symbolism of physically destroying your credit card works on several levels. Cutting up your card makes a forceful and even aggressive statement that you are making a change from how you have used your credit previously. You are making a break (slice) from your past overspending and choosing to start anew.

Additionally, cutting up your credit card is an act of recognition that you are in a position that requires change. Previously, you have valued the plastic card for its ability to get you what you want when you want it. Getting rid of it means you are willing to show self-discipline and delay the gratification of your impulses in exchange for a more stable and successful long-term financial situation.

If you cut up your credit cards in secret, you are still making a statement to yourself. However, you can make your statement more powerful by including others. Doing so turns your statement into something akin to a ritualized commitment (e.g. the oath of office, marriage vows, or a spiritual baptism) while turning your friends, family members, or counselors present into witnesses to your pledge. With the weight of these witnesses’ support, you make yourself accountable for following through with the promise to yourself.

To make yourself even more accountable, you might consider sharing your cutting commitment on your social media pages. Cutting up your credit cards for your entire social circle to witness means you are bound to be asked many times in the future how your determination to stop overspending is going. Such questions create motivation to persist.

How Cutting up Your Credit Card Creates Spending Barriers

Destroying your plastic card means you no longer have it available for making in-person purchases. While online purchases are becoming more common (think of the explosion of food delivery purchases that happened during the coronavirus pandemic), the vast majority of purchases are still made offline and in person. Although you might be a big online shopper and place one or two orders a week, each week, you are likely to stop at a grocery store, gas station, multiple coffee shops, a few restaurants, a movie theater, and a couple of department or discount stores.

Each time you stop at one of these stores, shops, or retailers, you put yourself in a tempting position to use your credit card to make a purchase if you have it in your purse or wallet. By cutting up your card, you deny yourself the possibility of using the card at many, though not all, of these consumer locations. To make certain you stick to your commitment, though, you will need to consider taking a few additional steps to eliminate your card from all forms of potential payment.

What Else You Need to Do along with Cutting Up Your Credit Card

In our digital world, you must also cut up the digital equivalents of your plastic credit card. This includes removing your card account from any online retail accounts you may have, such as Amazon, eBay, and iTunes. Additionally, you will need to remove your credit card account information from any digital wallets or mobile payment apps you have used, even once, over the years. These include services such as Apple Pay, Google Pay, PayPal, Samsung Pay, and Venmo.

Moreover, you should check your phone in case you ever took a photo of your card. If you use a digital security app (“password vault”), you will also need to delete your card number there.

Why all the fuss about deleting all traces of your card number? If you are to the point of cutting up your credit card, you have likely been struggling to control your consumer spending. Leaving your card number online or in your digital wallet is the equivalent of an alcoholic throwing away all his or her bottles of liquor except for a flask of gin carried in a coat pocket.

If you are going to take the dramatic step of cutting up your card, you must eliminate all opportunities to use the card.

The final option for eliminating the possibility of overspending on your card involves actually closing your credit card account. This is a drastic move that will have both immediate and likely long-term consequences on your credit rating. When you close your account, besides being unable to use it for purchases, the credit card company will change the status of the account on your credit report from “open” to “closed.” A closed account may still influence your credit rating, but it will not offer any credit-building opportunities. Closing the account also erases any good “balance-to-limit” ratio you might have had.

A good credit rating can be important, but for the purposes of this post, it may be less important than eliminating your consumer overspending.

How to Correctly Cut up Your Credit Card

Now that you have decided to cut up your credit card and have even chosen the venue (alone, with a family member or friend, or on social media), it is time to do the actual cutting. Consider the following when performing this ceremony:

  1. Use a pair of strong scissors. Using flimsy scissors can backfire and lead to injury if the blades slip and catch your finger(s).

  2. Take your scissors and cut across your card’s security chip (the square on the righthand side of your card when looking at the front).

  3. Cut directly through the card account numbers (straight across) before cutting up and down to ensure there are no more than one or two full numbers visible at all.

(Bending the card back and forth is an option many have tried. While you can typically bend and snap your card into four pieces, this method has its limitations in that it likely leaves your card’s ID chip intact and your card numbers visible.)

Cutting your card this way will also ensure you are cutting crosswise on the magnetic strip found on the card’s back. Be sure this strip is completely severed and in multiple pieces since it contains much information about your card. Finally, you should consider tossing various pieces of the cut-up card into multiple trash cans in your home, neighborhood, and work. As hard as you cut, you likely won’t end up with more than 20 or 30 pieces. That’s not a very complicated puzzle if a dumpster diver comes across your plastic chaos in your trash. Best alternative? Use a cross-cut shredder to destroy your card. Even most of the cheap, small shredders can handle a single credit card you run through them.

Alternatives to Cutting up Your Credit Card

You may not be at the point of cutting up your credit card. Instead, you might just want a way to slow down your reaching for yourself when you experience impulsive situations. If such is the case, you might consider a couple of other options rather than cutting up the card completely.

One popular alternative involves fully immersing your card(s) in a small cup of water and placing that cup in your freezer until the water has turned to solid ice. You can then remove the card from the cup and place it in a plastic freezer bag for long-term storage in the bag of your freezer or, better yet, at the bottom of your freezer.

If you come across a true financial emergency and need to thaw your card, it will take work and time, both of which will lead to further reflection on the purchase and whether it is truly an emergency. There is no guarantee this method will keep you from making unnecessary consumer spending. After all, anyone with a hairdryer can get to the card in a matter of a few minutes. However, even that effort might help.

Additionally, you might consider placing your card under lock and key, literally. If you have a safe in your home, place your card in the safe and entrust the key to the most responsible family member or friend you have.

Placing it in a safe deposit box at a bank or credit union across town also serves a similar purpose, though the monthly expense of the box might defeat the ultimate goal of decreasing your expenses.

If it’s past the proverbial point of no return, and the credit cards are maxed out, you may want to consider consolidating the credit cards on a debt management plan. These plans are run by nonprofit credit counseling organizations such as Money Fit and are a safe alternative to repaying your debt in full and on improved terms.

Related Questions

Does cutting up your credit card hurt your credit score? Cutting up your credit card will not directly affect your credit score. Since you will no longer be using the credit card, cutting up the card means you will not be adding any activity (positive or negative) to your credit. Over time, though, you may see your credit rating decline.

Do you really need a credit card? No one needs a credit card to survive. Credit cards are tools that add convenience to making and tracking your purchases while also building a history of credit usage. With a good credit history, you can take out a mortgage at a lower interest rate (less interest paid over time) than you could with poor credit or no credit.

About the Author

Client Credit Report Authorization

You hereby authorize and instruct Debt Reduction Services, Inc. (DRS, dba Money Fit by DRS) and/or its assigned agents to:
  • Obtain and review your credit report, and
  • Request verifications of your income and rental history, and any other information deemed necessary for improving your housing situation (for example, verifying your annual property tax obligations and homeowner’s insurance fees)
Your credit report will be obtained from a credit reporting agency chosen by DRS. You understand and agree that DRS intends to use the credit report evaluate your financial readiness to purchase or rent a home and/or to engage in post-purchase counseling activities and not to grant credit. You understand you may ask any questions pertaining to your credit report. However, while DRS will review the information with you, the company is not able to furnish you with a copy of your credit profile. You hereby authorize DRS to share your information from your credit report and any information that you provided (including any computations and assessments produced) with the entities listed below to help DRS determine your viable financial options.
  • Banks
  • Counseling Agencies
  • Debt Collectors
  • Landlords
  • Lenders
  • Mortgage Servicers
  • Property Management Companies
  • Public Housing Authorities
  • Social Service Agencies
Entities such as mortgage lenders and/or counseling agencies may contact your DRS counselor to evaluate the options for which you may be eligible. In connection with such evaluation, you authorize the credit reporting and/or financial agencies to release information and cooperate with your DRS counselor. No information will be discussed about you with entities not directly involved in your efforts to improve your housing situation. You hereby authorize the release of your information to program monitoring organizations of DRS, including but not limited to, Federal, State, and nonprofit partners for program review, monitoring, auditing, research, and/or oversight purposes. In addition, you authorize DRS to have your credit report pulled two additional times to conduct program evaluations. You also agree to keep DRS informed of any changes in address, telephone number, job status, marital status, or other conditions which may affect your eligibility for a program you have applied for or a counseling service that you are seeking. Finally, you understand that you may revoke consent to these disclosures by notifying DRS in writing.

Client Privacy, Data Security, and Client Rights Policy

NOTE: This sheet is to inform new or returning clients about our services, records, fees, and limitations that may affect you as a consumer of our services. This form also discloses how we might release your information to other agencies and/or regulators. If you do not understand a statement, please ask a Debt Reduction Services (DRS) counselor for assistance.

Debt Reduction Services, Inc. (DRS) has put into place policies and procedures to protect the security and confidentiality of your nonpublic personal information. This notice explains our online information practices and how we use and maintain your information to conduct our financial education and credit counseling sessions and to fulfill information and question requests. This privacy policy complies with federal laws and regulations.

To provide our financial education and credit counseling services, we collect nonpublic personal information about you as follows: 1) Information we receive from you, 2) Information about your transactions with us or others, and 3) Information we receive from your creditors or a consumer reporting agency. We do not share this information with outside parties.

We use non-identifying and aggregate information to better design our website and services, but we do not disclose anything that could be used to identify you as an individual.

You hereby authorize DRS, when necessary, to share your nonpublic personal, financial, credit, and any information that you provided (including any computations and assessments produced) with the following entities in order to help DRS provide you with appropriate counseling or guide you to appropriate services: third parties such as government agencies, your lender(s), your creditor(s), and nonprofit housing-related and other financial agencies as permitted by law, including the U.S. Department of Housing and Urban Development.

To prevent unauthorized access, maintain data accuracy, and ensure the correct use of information, we have put in place appropriate physical, electronic, and managerial procedures to safeguard and secure the information we collect online. We limit access to your nonpublic personal information to our employees, contractors and agents who need such access to provide products or services to you or for other legitimate business purposes.

Debt Reduction Services, Inc. complies with the privacy requirements set forth in the HUD housing counseling agency handbook 7610.1 (05/2010), including the sections 2-2 Mc, 3-1 H(2), 3-3, 5-3 F, and Attachment A.5. At all times, we will comply with all additional laws and regulations to which we are subject regarding the collection, use, and disclosure of individually identifiable information.

  1. Services: DRS provides the following housing-related services: counseling that includes Homeless Assistance, Rental Topics, Pre-purchase/Homebuying, and Home Maintenance and Financial Management for Homeowners (Non-Delinquency Post-Purchase); Education courses that include Financial literacy (including home affordability, budgeting, and understanding use of credit), Predatory lending, loan scam or other fraud prevention, Fair housing, Rental topics, Pre-purchase homebuyer education, Non-delinquency post-purchase workshop (including home maintenance and/or financial management for homeowners), and other workshops not listed above.

Please refer to DebtReductionServices.org for details of our services.

  1. Limits: Our services are limited to our normal weekday business hours. We do not provide individual counseling or education services after hours or on weekends, although our education courses are available 24/7.
  2. Fees: We do not charge fees for our financial management counseling and education. However, if you use them, you may have to pay for our Debt Management Program, Student Loan Counseling, Bankruptcy Certificate Services or certain financial education courses (homebuyer education, rental topics, fair housing, predatory lending, and post-purchase-non-delinquency including home maintenance and/or financial management for homeowners).
  3. Records: We maintain records of the services you receive, including notes about your progress or other relevant information to your work with us. You have the right to access and view your records by making a request to your counselor.
  4. Confidentiality: We respect your privacy and offer our services in confidence with the understanding that we may share such information with auditors and government regulators. Certain laws or situations may also lead to disclosing confidential issues, such as those involving potential child abuse or neglect, threats to harm self or others, or court subpoenas.
  5. Refusal of Services: You have the right to refuse services without any penalty or loss.
  6. Disclosure of Policies and Practices: You will be provided our agency disclosure statement.
  7. Sharing of Information: Sometimes we will need to contact other agencies or we may need to share your information, including your records, with other agencies or with regulators. We will do this only if you sign this form that gives us permission except for limited reasons; please see # 5 above for examples of such situations.
  8. Other: You have the right to be treated with respect by our staff, and we expect the same from you in return. We encourage you to always ask questions if something is not clear. We also encouraged you to express your thoughts and advocate throughout our services.

You acknowledge that this authorization will remain in effect for the duration of time that DRS serves as your housing counselor or financial education provider. You also acknowledge that should you wish to terminate this authorization, you will notify DRS in writing.

Disclosure  Statement

NOTE: If you have an impairment, disability, language barrier, or otherwise require an alternative means of completing this form or accessing information about our counseling services, please communicate with your DRS representative about arranging alternative accommodations.

Program Disclosure Form

Disclosure to Client for HUD Housing Counseling Services

Debt Reduction Services, Inc. and its financial education arm, Money Fit by DRS, offer the following housing counseling and educational services related to housing, personal finance, and bankruptcy certificates to consumers:
  • Housing Education Courses: DRS offers many online self-guided education programs classified as Financial, Budgeting, and Credit Workshops (FBC), Fair Housing Pre-Purchase Education Workshops (FHW), Homelessness Prevention Workshops (HMW), Non-Delinquency Post Purchase Workshops (NDW), Predatory Lending Education Workshops (PLW), Pre-purchase Homebuyer Education Workshops (PPW), and Rental Housing Workshops (RHW). These courses help participants increase their knowledge of and skills in personal finance, including home affordability, budgeting, and understanding the use of credit, as well as predatory lending, loan scams, and other fraud prevention topics, fair housing, rental topics, pre-purchase homebuyer education, non-delinquency post-purchase topics including home maintenance and/or financial management for homeowners, homeless prevention workshop, and other workshops not listed above relating to personal finance and housing. Course details are found below under “Housing Workshops.”
  • Home Equity Conversation Mortgage (HECM) Counseling (RMC): Via telephone and virtual platforms, we offer the required HECM counseling nationwide in addition to in-person counseling in Boise, Idaho. We also offer in-home counseling options in thirty counties across southern Idaho for an additional fee to cover our travel and additional staff time costs.
  • Home Maintenance and Financial Management for Homeowners (Non-Delinquency Post-Purchase) (FBC): Clients receive counseling and materials on the proper maintenance of their home and mortgage refinancing. Clients can find help and resources by phone, in our Boise office, or virtually on all topics related to stabilizing their long-term homeownership.
  • Services for Homeless Counseling (HMC): Clients receive phone, virtual, or in-person (Boise) counseling to evaluate their current housing needs, identify barriers to and goals for housing stability, establish a path to self-sufficiency, and connect with emergency shelters, income-appropriate housing, and/or other community resources (e.g. mental healthcare, job training, transportation, etc.).
  • Pre-Purchase Counseling (PPC): Clients receive counseling through the entire homebuying process. Assistance may involve creating a sustainable household budget, understanding mortgage options, building their credit rating, and putting together a realistic action plan to set and achieve homeownership goals.  Additionally, clients will receive materials and resources about home inspections and other homeownership topics relevant to successfully maintaining a home.
  • Rental Housing Counseling (RHC): Via phone, in-person appointments (Boise, ID), or virtual platforms, clients receive housing counseling relevant to renting, including rent subsidies from HUD or other government and assistance programs. Topics can also address issues and concerns having to do with fair housing, landlord and tenant laws, lease terms, rent delinquency, household budgeting, and finding alternate housing.
DRS also offers the following services:
  • A Debt Management Program (DMP) for consumers struggling to pay their credit cards, collections, medical debts, personal loans, old utility bills, and past-due cell phone accounts;
  • The Budget Briefing and Debtor Education Certificates that are required during the Bankruptcy filing process;
  • A Student Loan Repayment Plan Counseling and application service.

Relationships with Industry Partners

Through such services, DRS has established financial relationships with hundreds of banks, credit unions, and creditors such as American Express, Bank of America, Barclays, Capital One, Chase, Citibank, Credit One, Discover, Synchrony, US Bank, USAA, Wells Fargo, and others.

No Client Obligation

The client is not obligated to receive, purchase or utilize any other services offered by DRS or its exclusive partners to receive financial education or housing counseling services. Alternatives: As a condition of our counseling services, in alignment with meeting our client services goals, and in compliance with HUD’s Housing Counseling Program requirements, we may provide information on alternative services, programs, and products available to you, if applicable and known by our staff. Alternative DMP services include negotiating better repayment terms directly with your individual creditors, paying your debts as agreed, or, in extreme cases, filing for personal bankruptcy. Alternative credit and education services can be found through MyMoney.gov or the Jump$tart Clearinghouse of online financial education resources. Housing counseling alternatives can be found through HUD at www.hud.gov/findacounselor.
Finally, you understand that you may revoke consent to these disclosures by notifying DRS in writing.

Housing Counseling and Education Fee Schedule

 

Online Education Program Fees*

Homebuyer Education Course: $59 per participant

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours)

RentalFair HousingPredatory Lending / HOEPAPost-Purchase (Non-delinquency post-purchase workshop, including home maintenance and/or financial management for homeowners) Online Workshops: $49 per participant

  • Approximately 1 hour each

Other Self-Guided Financial Literacy Webinars (e.g. creditbudgetinghomeless preventiondebt prevention): $0

One-on-one Counseling Fees*

Pre-purchase Homebuying Counseling, Rental Counseling, Post-purchase Ownership Maintenance and Financial Management: $75

  • Session by the hour

Reverse Mortgage/HECM Counseling with Required Certificate:

  • $200†

Credit Report Fee: Paid Directly by Client

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page

†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there).

Housing Counseling and Education Fee Schedule

 

Online Education Program Fees*

Homebuyer Education Course: $59 per participant

  • Self-paced course available here, our online housing counseling and education center. Certificates will be automatically generated upon completion of the course (approximately 6-8 hours)

RentalFair HousingPredatory Lending / HOEPAPost-Purchase (Non-delinquency post-purchase workshop, including home maintenance and/or financial management for homeowners) Online Workshops: $49 per participant

  • Approximately 1 hour each

Other Self-Guided Financial Literacy Webinars (e.g. creditbudgetinghomeless preventiondebt prevention): $0

One-on-one Counseling Fees*

Pre-purchase Homebuying Counseling, Rental Counseling, Post-purchase Ownership Maintenance and Financial Management: $75

  • Session by the hour

Reverse Mortgage/HECM Counseling with Required Certificate:

  • $200†

Credit Report Fee: Paid Directly by Client

*Fees for all but our online education courses and workshops can be paid online by debit card, credit card, or PayPal or in person by cash, check or money order to: “Debt Reduction Services, Inc.” Registration fees are non-refundable 24 hours or less before the start of an in-person course or workshop. Certificates are non-transferable

*Fees may be waived for households with income of 150% or less of that identified on the US Department of Health and Human Services Poverty Guidelines Page

†Home visit counseling is available in 30 southern Idaho counties for potential HECM borrowers at additional costs to cover our travel (IRS reimbursement rates apply) and staff time ($50 per hour or fraction there).